Smartwatches may account for approximately 55 percent of all wearables on the global market five years from now, Forrester wrote in its latest State of Wearables report published earlier this week. In terms of pure industry value, that’s an increase from $4.8 billion in 2016 to $9.1 billion in 2022. With the research firm estimating that Internet-enabled watches made up only 21 percent of the same market last year, its prediction puts a lot of faith into this emerging product category in the medium term, with its analysts explaining the optimistic forecast with a wide variety of arguments.
Perhaps most importantly, smartwatches are likely to start gaining additional popularity as their prices keep declining, with this trend primarily being backed by falling manufacturing costs, most notably in terms of component prices. While some major brands like Apple aren’t expected to pass on savings to consumers, a broad range of them may do so because they’ll see such a move as an opportunity to start competing in a more aggressive manner. An all-out price war doesn’t seem plausible in the immediate future, but a gradual decline in prices across all smartwatch categories certainly does, the report suggests. Evolving user experiences are another major factor suggesting wearables will soon become a more attractive proposition as more companies manage to deliver intuitive experiences, something that proved to be an issue with older gadgets, Forrester suggested. In the long-term, the firm predicts more intelligent watches will start leveraging voice-enabled technologies that it believes are the most convenient method of interacting with such devices.
Continued diversification is another major factor why this product segment is said to be poised to gain significant ground in the coming years, with contemporary smartwatches adopting flagship features of everything from fitness trackers to smartphones, thus appealing to a wide variety of consumers. Devices like the Fitbit Ionic and Garmin’s Fenix series are expected to become more numerous going forward as an increasing number of consumer electronics manufacturers tries to deliver products that offer a blend of stylish form and function. Apart from average consumers, healthcare is expected to fuel a massive growth of wearables in developed countries like the United States, according to the report.