- The wearables market is in the beginning phases of expansion. We estimate global shipments will increase at a compound annual growth rate (CAGR) of 24.8% over the next five years, reaching 162.9 million units in 2020.
- Emerging consumer and professional healthcare trends are driving interest in wearables. These include the growth of the "quantified-self" movement and advances in digital health.
- Fitness tracking is the leading consumer use case for wearables. Most wearables, including smartwatches, are used for recording exercise- and health-related metrics (e.g. distance traveled, calories burned, and other biometric data).
- Wearables are beginning to be used throughout the healthcare market in many areas of service provision. A host of industry players, including hospitals, innovative med-tech companies, pharmaceutical firms, and insurance companies have started employing these devices to achieve efficiencies and improve treatment.
- Accuracy remains the top barrier to widespread wearable adoption in the healthcare sector. Device makers must overcome shortcomings in the utility and accuracy of the data wearables collect. Privacy concerns and regulatory hurdles also must be addressed.
- Wearables will help to usher in a more collaborative healthcare model. More robust platforms, including those in development by tech giants such as Apple, Google, and Samsung, will enable patients to securely share actionable health data with caregivers. This will help close the loop between basic fitness tracking and actual medical care.
The wearable technology market continues to grow, but nagging questions remain: Where and how will these devices be used? Will they live up to the hype that they will transform consumers' lives? Proponents compare their potential to that of smartphones and tablets, both of which helped usher in a new era of personal computing, while skeptics see narrower opportunities for wearable technologies.
Although the wearables market is expanding rapidly, it remains small relative to more established consumer technologies. We estimate global wearable device shipments will increase at a CAGR of 24.8% over the next five years, reaching 162.9 million units in 2020. By comparison, global smartphone shipments topped 340 million in Q2 2015. Our definition of wearables comprises fitness bands, smartwatches, smart clothing, and other assorted devices like Google Glass eyewear.
Demand for fitness trackers, geared toward measuring exercise (walking, jogging, and other movement-related activities), distances traveled, calories burned, and other health metrics, is leading the growth of wearables overall. These devices sync data, in many cases wirelessly, to a [...]