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Wearable devices

By Joseph Ricketts,

Jie Zhou，

Zhanyuan Liu

Focus on : Smartwatch

A wearable computing device worn on a user's wrist that offers functionality and capabilities similar to those of a smartphone.

Smartwatches are designed to, either on their own or when paired with a smartphone, provide features like connecting to the internet, running mobile apps, fitness tracking，making calls, messaging via text or video, checking caller ID, accessing stock and weather updates, providing fitness monitoring capabilities, offering GPS coordinates and location directions, and more.

Define

A number of companies either currently have smart watches on the market or are rumored to be developing smartwatches, including Google, Samsung, Apple iwatch, LG, Sony, Pebble and various others.

$ 2,500,000,000 Market

Smartwatch Market Share

In 2013, the global smartwatch industry reached a global market volue of USD 700 million, ten times the size of 2012. In 2014, the industry will grow to USD 2.5 billion – 5% the size of the watch industry. The firm who made smartwatch they also producer smartphone. like apple, sumsung, lg, if produce the wristwatches adding extra value to the firms.

Who’s Buying These Devices?

for gender,About 68 percent of smart watch owners are between 25 and 49 years old, Among those surveyed, 67 percent of smart watch owners were male while 58 percent of smart band owners were female.

you can see men spend more money than woman in smartwatch market and women spend more in fitness tracker so we can infer that women focus on health and body fitness, and maybe more men doing business than women. So men regard the watch more important than women.Speak of the watches, and compare smartwatch to luxary watch, smartwatch takes people less money. Average smartphone sold at 189 dollars, but luxuary watch definately higher than smartphone.

Introduction

Wearable devices are gadget or accessories such clothes or hand held devices, that use automated and electronic performance.

Wearable devices tend to generate good market potential for Internet of Things.

. Most devices in the wearable device industry that are being launched are for healthcare and sports.

Examples of wearable devices include; Activity tracker devices such as fitness trackers, smart watches, non smart watches and other wearable devices. The global market of these devices is growing rapidly. It holds major potential with the acceptance getting wider. Innovations are rapidly changing and people are becoming more and more innovative as the years progress. Currently, these devices are still in the early stages as the world is changing technologically at a rapid pace. They are good examples of ‘internet of things’.

They facilitate connection of things, people, and places. The main factors that will drive these gadgets to their optimum growth in the global wearable device industry include factors like introducing innovative products like the smart watch and iWatch. Other factors include convenience of carrying, wearables made for the purpose of business and ease of new players in the Industry.

Several devices were launched in 2013, for example, the smart watches and bracelets. Popular research believes that these gadgets will contribute to the rapid growth of the Industry.

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Underlying determinants of market competitiveness

Entry and Exit barriers

Economies of size plays a big role in barriers to Entry.

The venture is capital intensive.

Some typical barriers to exit include high fixed costs and specialized skills.

Competition

These devices are getting accepted more and more in this modern era. In a world dominated by technology, everyone is looking for easier ways to achieve a task and in the shortest time possible. There are no strict laws governing the import or export of these devices.

A large volume of these gadgets get produced on a daily basis. At times the cost or production is higher than the number of sales of a particular gadget, thus results in loss

some of the raw materials have to be imported from other countries. Some other companies struggle with competing with established brands, which generally limits their entry into the market.

The industry has highly skilled participants which hinders them from leaving the company

Internal competition is another crucial factor that determines competitiveness of the market. Companies that cover wearable devices such as Himax, Samsung, Iven sense and other companies offer competitions amongst themselves. A good example is the recent clash between Samsung, and Apple, the two largest phone companies. Apple filed a lawsuit against Samsung for infringing on their patent while making their smart phone.

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Is the market a mature one or a growing one?

The market is still in its early stages and therefore not yet mature but a growing one.

The main challenge for companies that manufacture this wearable devices is sustained engagement

Factors that guarantee longevity of this industry and this devices.

It is rapidly growing due to the wide acceptance of internet usage in the world today. At least 10 new wearable devices have been introduced by top players in the game such as Sony, Garmin, LG, Razer and more. There is a lot of enthusiasm in the market. However, the current generation of these products fail to sustain long-term behavior change and engagement.

A recent study shows that one in every 10 teenager above the age of 18 years owned an activity tracker. However another study shows a third of the consumers who have bought and used these wearable devices no longer use it after a period of six months. This is the main challenge that manufactures and company coverages are having and this is what is preventing this market from attaining the mature market.

One of these factors is the habit formation that comes with these gadgets. People are continuously using these gadgets to perform their daily tasks. This forms a routine in their schedules and thus becomes a habit. Smartphones can be used as a good example as nowadays teenagers are inseparable with their smartphone as they are busy texting on WhatsApp or chatting with their friends on other social platforms.

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Future of the market structure

The future market structure of wearable devices will be a competitive one.

The market is moving towards a more effective and goal oriented wearable devices.

With the rising interest in technology among peers and the rapid change of technology in this modern era, there will be nothing but better devices being invented and manufactured. Every other day people are advancing and need more advanced technology. Manufacturers continue to work tirelessly to try and improve and sustain engagement beyond habit formation. Manufacturers are now looking for way to socially motivate its users. Social connection are a powerful source of motivation. Examples of exercises that socially motivate the users include asking them to accomplish a certain goal or when they are able to share goals and ideas. Such kind of a strategy will help these devices to last a couple more decades.

The potential for these devices remain promising as more and more products revolve around trying to understand the complex science of human behavior and habit formation. The market structure is moving slowly towards producing gadgets that focus more on personal satisfaction of the consumers as well as strengthening the efficiency of performing a specific task. A deeper understanding of social motivation, habit formation, and goal reinforcement will help companies to create better devices that are more effective and successful to promote wellness and health.

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Recent Event

The recent event that really changed who was in charge of the market was when Apple realeased their version for a watch.

Investors, Consumers, and Managers

Analysts have estimated that by 2017 could be selling 40 to 50 million watches. So for the investor it looks like it would pay off if you got some Apple stocks.

The manager I would assume for Apple would want to try and keep sales up while making the next model. For Samsung the manager would be trying to innovate their existing or make a new model before Apple so as to get some of the market back.

References

Poynter, R., Williams, N., & York, S. (2014). The handbook of mobile market research: Tools and techniques for market researchers.

FutureTech (Conference), In Park, J. J., In Chao, H.-C., In Arabnia, H., In Yen, N. Y., & International Conference on Multimedia and Ubiquitous Engineering. (2016). Advanced multimedia and ubiquitous engineering: Future information technology.

Perkins, W. J. (2014). High Technology Aids for the Disabled. Burlington: Elsevier Science.

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Questions?