We know that technology is overtaking our lives. But we don’t get a sense of how overwhelmingly true that is until a stat like this comes up: In the last quarter of 2015, smartwatch shipments surpassed those of traditional Swiss-made timepieces for the first time ever!
Let that sink in for a bit.
Apple Watch is leading the total shipments of smartwatches which were reported to be around 8.1 million units worldwide. In comparison, the analog watches saw a shipment of 7.9 million units. Granted, it might not be much, but that gap is likely to increase very rapidly.
Unprecedented Growth Rate
The mammoth rate of growth in the digital sector is obvious from the figures. Shipments have grown 316% while compared to the same quarter from a year before (Q4-2014).
“Smartwatches are growing rapidly in North America, Western Europe and Asia,” said Strategy Analytics Director Cliff Raskind. “Apple Watch captured an impressive 63 percent share of the global smartwatch market in Q4 2015, followed by Samsung with 16 percent.”
That means Apple and Samsung have a combined market share of 79 percent. That’s 8 in every 10 watches being shipped. That kind of market share is really tough to compete with. No wonder the Swiss have reported a slow start to 2016.
New Market Dynamics
Wristwatches aren’t something you’d buy every year. Ideally you’d want your watch to last at least half a decade. So that’s another market dynamic the watchmakers have to deal with. But because the smartwatch is a gadget, it has a “social expiry date”, and people tend to upgrade them every year.
Such complex issues have led to the rise of an all new type of partnership in the Watch industry. Just last November, TAG Heuer unveiled a $1,500 ‘Connected’ smartwatch running Android Wear. The firm said buyers can swap out their smartwatch for a mechanical version after two years, with an additional $1,500 upgrade fee.
The Swiss wristwatches are one the most iconic brands in the world. They evoke a rare sense of pride in the owner and boast of some of the most loyal customer base for any brand in the world. And the fact that they are losing market share to a tech gadget is a testament to how much technology has crept into our lives.