Apple Watch Could Grab 40% of Market by 2020
The latest report on the Apple Watch holds potentially ominous news for the makers of both fitness bands and traditional timepieces. Could the smartwatch gobble up a major slice of the marketing pie by 2020?
A new report from Business Insider’s research arm BI Intelligence predicts that smartwatches in general and the Apple Watch in particular are siphoning off sales of fitness trackers in the wearable market. The report projects that as smartwatches become more feature-packed and less expensive they will drive down the demand for dedicated fitness bands like the Fitbit Force and Jawbone Up.
In 2014, fitness bands held a 54% share of the wearables market but that share is down to 48% this year and is expected to drop to 42% by 2020. The maker of fitness bands are already trying to stave off this threat by offering more attractive models for the fashion-conscious fitness buff like the Tory Burch-designed Fitbit available at Nordstrom stores.
There’s equally gloomy news for the makers of traditional timepieces as the report predicts that the Apple Watch will take over two-fifths of the market for luxury watches by 2020. That would leave just 60% for an industry that formerly controlled the whole enchilada.
The report acknowledges that even the $10,000 Apple Watch Edition isn’t likely to take the place of a $15,000 Rolex for most luxury minded customers but could do some serious damage at the lower end. “Assuming a lower-bound price of $350 for the luxury-watch category, and including Apple Watch in that category, traditional wristwatches would account for ~60% of total shipments in 2020, while Apple Watch would account for ~40%.”
Of course, these are just prognostications and are not guaranteed to come true. The makers of both wearables and luxury watches still have time to adapt to the threat posted by the smartwatch as well as the changing tastes of the buying public.