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Substantial growth in Africa's wearables market

By , Portals editor
Africa , 11 Jul 2016

Substantial growth in Africa's wearables market

While Africa's PC market experienced 18.8% year-on-year decline in 2015, and 17.2% year-on-year decline in Q1 2016, research by the International Data Corporation (IDC) shows that the continent's wearables market experienced year-on-year growth of 89.9% in the first quarter of 2016.

To keep pace with the changes taking place in this fast-moving market, the IDC launched its Worldwide Quarterly Wearable Device Tracker, designed to help vendors looking to enter this market, promote new product developments, or accelerate the growth of their wearables divisions.

The tracker includes details on products, vendors, and technology trends at both global and country levels, as well as historical market data and five-year forecasts.

The information is being used to provide insight into the adoption of core wearable features, such as form factor, connectivity, sensors, operating systems, and applications.

In its tracking of Africa, the IDC focused on two specific regions, South Africa and ROA (rest of Africa).

According to the research company, of the total 419, 925 units shipped to MEA in the first quarter of 2016, Africa received 112, 712 units.

"The growth of the wearables market provides a rare ray of light amid an overall downturn for personal computing in the region," says Nakul Dogra, a senior research analyst for personal computing, systems, and infrastructure solutions at IDC Middle East, Africa, and Turkey. "This growth has been spurred by a number of factors, including declining average selling prices, new product launches, the entrance of lower-cost wearables, and the introduction of sleeker designs."

Dogra explains that basic wearables have higher share in Africa. During Q1 2016 81% of the devices are basic wearables and the remainder 19% is smart technology for the first quarter of the year.

The split in the Middle East is 68% basic and 32% smart. "Basic wearables have lower ASP compared to smart which is driving the growth in a price sensitive continent," Dogra adds.

According to the IDC smart wearables, which are classified as devices capable of running third-party applications, are still finding their feet in the market as many consumers continue to view the devices as too expensive for the features and functions they offer.

"As such, most of the growth in this segment of the market stems from the increasing popularity of smart watches," the research company affirms.

Basic wearables, which are not capable of running third-party applications, continue to dominate the overall MEA wearables market with 71% unit share versus 29% for smart wearables. This dominance can be attributed to the growing popularity of fitness bands, which have been flooding into the market for a while now, proving to be a big hit with consumers.

The IDC forecasts a compound annual growth rate (CAGR) of 20.1% for the 2016–2020 period, driven primarily by the adoption of smart watches and wristbands.

"The growth will be further augmented by the launch of new wearable products in the clothing, eyewear, earwear categories, among others," says Fouad Rafiq Charakla, a senior research manager for personal computing, systems, and infrastructure solutions at IDC Middle East, Africa, and Turkey. "IDC expects vendors to step up their new product launches in the MEA market as share gain becomes the name of the game. We also anticipate new operating systems and versatile pools of applications to emerge in order to support all these new devices."

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