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Wearables saw explosive—but conditional—growth in 2020

2020 was a landmark year for wearables adoption, according to a new IDC report. Worldwide wearables shipments reached 444.7 million units in 2020, a 28.4% increase year over year (YoY), and in Q4 alone, shipments increased 27.2% YoY to reach 153.5 million units.

Apple made up the lion’s share of those Q4 shipments, with 55.6 million units and a 36.2% share of the global wearables market. For comparison, the two closest competitors, Xiaomi and Samsung, lagged far behind Apple, with 8.8% and 8.5% market share in Q4, respectively. Apple’s dominance was driven largely by a 45.6% YoY increase in shipments of its Watch devices, and a 22% YoY increase in hearables.

Part of the adoption surge in the US can be attributed to the coronavirus pandemic, which saw renewed consumer interest in wearables and increased consumer electronics spending generally. Many consumers have turned to wearables during the pandemic to help manage their own physical and mental health. Fifty-four percent of US adults reported using a digital wearable to track at least one health metric last year, according to Rock Health’s 2020 Digital Health Consumer Adoption Report, an increase from 44% the previous year. Further, 46% of respondents began using their wearables for a new purpose during the pandemic, with the most popular reported new uses being to manage a diagnosed health condition (66%), fitness tracking (34%), and trying to become more physically active (32%).

At the same time, overall US consumer spending on electronics also increased last year. US sales of consumer technology through December were up 17% compared with the previous year, according to NPD Group’s recent Future of Tech forecast. The increase in consumer tech sales, which NPD attributes to the pandemic, represents "the strongest growth in at least seven years."

However, it’s unclear whether the recent uptick in wearables will outlive the pandemic boom. eMarketer’s latest US Smart Wearable Users forecast expects 21% of the US population will use a wearable device at least once per month by the end of 2021, a slight increase from 20.2% projected at the end of 2020. From there, the forecast expects only modest growth in smart wearable adoption, eventually reaching 22.8% of the population by the end of 2024. We believe the pandemic-driven wearables boom may struggle to maintain its pace once living conditions eventually return to some degree of pre-pandemic normality.

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