Year-over-Year Wearables Spending Doubles, According to NPD

Port Washington, NY, February 1, 2016 – According to global information provider, The NPD Group, annual 2015 dollar and unit sales of connected activity trackers experienced respective growth of 110 percent and 85 percent versus 2014, despite the average selling price (ASP) increasing from $96 to $109.

“The increase in ASP speaks to these devices becoming more sophisticated, and that consumers are looking for better-quality devices, not just entry-level products,” said Ben Arnold, executive director, industry analyst for The NPD Group. “This, combined with unit growth, shows that prices aren’t falling to drive demand; demand is increasing along with rising prices.”

Fitbit remained the leading brand in connected activity trackers in 2015, accounting for 79 percent of sales; the company has been the market leader in connected activity trackers since 2014, growing market share by more than 20 points since that time despite the entrance of new competing products in the wearables category.

“A confluence of factors has contributed to the growth of connected fitness trackers. Greater awareness of the products is leading to increased interest, new colors and designs have made trackers more appealing, and there are more opportunities to buy the products due to increased distribution,” said Arnold. “The dedicated fitness tracker market will continue to thrive as the products evolve and cover a wider range of users’ fitness needs.”

The Smartwatch Impact
While the smartwatch category continued to gain in popularity due to the Apple Watch launch in April 2015, overall ownership growth has continued to trail the more mainstream fitness tracker category. According to the latest NPD Connected Intelligence forecast numbers, fitness tracker ownership in the U.S. market stood at nearly 33 million devices at the end of Q4 2015, while smartwatch ownership—including more traditional watches with smartphone notification capabilities—stood at almost 13 million.

However, according to the NPD Connected Intelligence Consumers and Wearables survey, awareness of the smartwatch device category is currently even higher than fitness trackers, at 83 percent compared to 75 percent, respectively, which bodes well for future growth once newer second-generation smartwatches with dedicated cellular connectivity and a larger number of traditional watches with notification capabilities are released during 2016. In fact, NPD predicts a significant ramp up in smartwatch ownership growth starting in the second half of 2016, with an expected overall ownership number of just over 30 million devices by the end of 2017.

“Despite slightly lower overall awareness of the fitness tracker category, fitness trackers are still showing strong sales and ownership, which shows that the category still has more headroom for growth, while strong awareness has not yet translated into more robust sales for smartwatches,” said Weston Henderek, Director of NPD Connected Intelligence.

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