Apple Watch to account for 40% of luxury watch market by 2020

Global wearable shipments forecastTraditional watch makers predicted that the Apple Watch would have a significant impact on their market even before it came out. For example, Elmar Mock, the co-inventor of the Swatch, predicted an “Ice Age” for the Swiss watch industry. Early numbers are suggesting that those fears were not unfounded. U.S. watch sales in June were the lowest seen in eight years and watch maker Fossil this week reported that Q2 revenues were down 4% in Q2. A Business Insider report is the latest to suggest that the Apple Watch will have a disruptive effect on the watch industry.

BI Intelligence defines a luxury watch as one that sells for US$350 or more. Under that definition, it expects that the Apple Watch will account for 40% of the luxury watch market by 2020. Shipments of Apple’s smartatch are predicted to top 40 million units a year by that point.

Apple Watch

More generally, the report found that smartwatches will have a similar effect on the fitness tracker market. As smartwatches gain additional functionality and become easier to use, consumers will increasingly use them to replace more rudimentary devices. As a result, the fitness band category will see its market share drop from about 53% in 2014 down to 42% by 2020 as it targets a “more niche, health-focused audience.”

It remains to be seen if traditional watch makers such as Tag Heuer will be able to slow down Apple as they begin to move into the smarter watch and smartwatch markets as well.

Source : Business Insider