India’s smartwatch market has undergone a rapid transformation. Previously dominated by local players, global giants like Apple and Samsung struggled to gain a foothold amidst the millions of annual shipments. However, a recent influx of unknown brands, previously non-existent in the market, has started gaining traction and is expected to drive the market towards consolidation.
Leading domestic brands like Fire-Boltt, Noise, and boAt have held a majority share of over 60% of the market. On the other hand, Apple and Samsung have seen a decline in their combined market share from 4.5% to just over 2%, with 1.1 million units shipped in 2023, according to IDC.
New entrants have rapidly increased their market share from 3-5% in 2020 to 15-20% last year. The market now accounts for 134.2 million units annually, according to Vikas Sharma, senior market analyst at IDC.
These unknown brands often offer products that bear resemblance to established brands like Apple and Samsung but come at a fraction of the price, starting at less than $12. However, the quality and reliability of these products are questionable, with fitness tracking metrics often being inaccurate due to cost-saving measures on sensors.
Despite the visual similarities, the accuracy and user experience of these unknown brands do not match up to premium models like the Apple Watch or Samsung Galaxy Watch. The influx of unknown brands in the Indian smartwatch market has grown significantly, from 78 in 2021 to 128 in 2023, according to Counterpoint Research.
Declining Prices
The rise of unknown brands has not yet had a significant impact on established players, but the declining Average Selling Price (ASP) has raised concerns. Some local brands are already feeling the pressure, with ASPs declining by as much as 90%, according to Sameer Mehta, CEO of boAt.
Market analysts have observed a drop in ASP by around 39% in 2023, signaling a challenging market environment. boAt, the third-leading smartwatch brand in India, saw a 17% decline in year-on-year growth in the fourth quarter, according to IDC.
Mehta stated that despite the impact from unknown brands, boAt aims to maintain a significant revenue share from smartwatches in the coming years. Meanwhile, Fire-Boltt and Noise saw growth in the same quarter.
Moves to Retain Market Share
Market experts suggest that key players need to adapt their strategies to compete with unknown brands in the market. Established brands should focus on adding value to their smartwatches and targeting existing customers rather than just first-time buyers.
Mehta mentioned that boAt is exploring new categories in the smartwatch market and designing models for specific customer segments to stay competitive. Despite the challenges, IDC predicts only single-digit growth in the Indian smartwatch market this year, with a possibility of consolidation in the near future.
Overall, the Indian smartwatch market is in a state of flux, with unknown brands disrupting the landscape and established players facing challenges to retain their market share.
