The price of smartwatches in India has nearly halved as compared to last year amid a price war between brands trying to secure a higher market share.
Experts said that thin profit margins on smartwatches raise concerns over the long-term viability of many brands, according to a report in the Mint.
They added that even those who survive this might need help transitioning customers into more lucrative premium products.
Industry executives said that the lowest-priced smartwatches in the market yield minimal margins, ranging from Rs 100-200.
Though the margins are higher on expensive products, the average selling price of smartwatches was at an all-time low in the June quarter.
Aman Gupta, co-founder and chief marketing officer of Boat, said, “Brands are aggressively vying for a bigger stake in the market, with some striving to attract funding by showcasing their market share. This approach seems unsustainable, pointing towards an inevitable need for consolidation. Well-funded players from Peak XV’s portfolio and even Titan have entered. The upcoming period will be interesting to watch out for.”
IDC India said smartwatch shipments doubled to 12.8 million units in the June quarter from 6.4 million units a year ago. IDC data for the corresponding periods showed shipments rose fourfold to 6.4 million in the June quarter of 2022 from 1.6 million in the year earlier.
However, according to the Mint report, this growth came on a much smaller base.
Navkendar Singh, associate vice-president at IDC India, said that smartwatch prices in India have dipped to a low base as companies are trying to gather market share by driving volumes.
According to the IDC data, Boat sells its base model for Rs 1,299. The base models of Noise and Fire-Boltt are priced at Rs 1,099 and Rs 1,349, respectively.