Compnay Reports

ChangeWave Research: Wearable Technology Trends February 2015 Consumer Wearable Technology Trends Considerable Demand for Wearables But Security Remains a Concern Jean Crumrine and Lusy Lisyanova Overview: The excitement surrounding wearable devices remains high, with the widely anticipated Apple Watch expected to shake-up the industry upon its release. A January ChangeWave survey of 1,145 respondents focused on the latest trends in the wearable technology market, including current ownership, future demand and consumer impressions about the security of personal information on wearable devices. ChangeWave Research is a service of 451 Research. Current Ownership of Wearable Devices The survey looked at current ownership trends and the types of devices consumers are already using, and a total of 14.1% of respondents say they currently own a wearable technology device. Among this group, Health and Fitness Monitor (88%) is by far the leading type of device, followed by Smart Watch (16%). Focusing on those who own a health and fitness monitor, two-thirds (65%) say they have a FitBit. Tied for a distant second place are Nike (7%), Garmin (7%), and Jawbone (7%). This information is from ChangeWave Research, a service of 451 Research, LLC, and contains confidential business information. It may not be copied or distributed without permission. ©2015 451 Research, LLC. All rights reserved. ChangeWave Research: Wearable Technology Trends Future Wearable Tech Demand Importantly, the survey shows considerable future demand for wearables, with 17% of respondents saying they plan on buying a wearable technology device in the future. Health and Fitness Monitor (53%) again tops the list in terms of the type of wearable device consumers plan on buying, with Smart Watch (51%) ranking a very close second. As we’ve seen in previous ChangeWave surveys, there is a great deal of overlapping interest for these two categories. A third (32%) of those planning to buy a Smart Watch also indicate they’ll purchase a Health and Fitness Monitor. Similarly, 30% of planned Health and Fitness Monitor purchasers also say they’ll buy a Smart Watch. Smart Glasses (8%) is a distant third in terms of planned buying. We note that Google recently shelved their Google Glass product for consumers, but a new version of the wearable will likely be released in the future. Focusing on the top two wearable technology areas, we asked respondents which manufacturer they’re most likely to purchase from: Health and Fitness Monitor. FitBit (32%) is the leading brand among consumers planning to purchase a Health and Fitness Monitor. Jawbone (8%) ranks second, and Microsoft (6%) – a new entrant with its recently released Band – isn’t far behind. We note that two-in-five (40%) say they don’t yet know which manufacturer they’ll buy from. Smart Watch. As the April Apple Watch launch draws closer, our survey shows Apple (76%) is the overwhelming number one choice among planned Smart Watch buyers. Samsung (3%) is a distant second in terms of future consumer demand. We asked planned buyers about the features most important to them when deciding which smart watch to purchase. This information is from ChangeWave Research, a service of 451 Research, LLC, and contains confidential business information. It may not be copied or distributed without permission. ©2015 451 Research, LLC. All rights reserved. 2 ChangeWave Research: Wearable Technology Trends Consistent with what we’ve seen for other electronic devices, Long Battery Life (65%) is the most important feature for planned smart watch buyers. But in a finding that shows it’s not just about function with wearables, Aesthetics/Design (44%) ranks as the second biggest consideration, followed by Wireless Connectivity (43%) and Health/Fitness Monitoring (42%). Security Concerns with Wearable Technology One factor often cited as hindering consumer adoption of wearables is security. To find out how much of an issue this is, we asked consumers about concerns regarding the safety and privacy of their personal information when it comes to wearable devices. A total of 28% of all respondents say they’re Very Concerned about safety and privacy on wearable devices, and another 36% say Somewhat Concerned. How concerned are you about the safety and privacy of your personal information when it comes to wearable technology devices? Current Survey Jan ‘15 Very Concerned 28% Somewhat Concerned 36% Not Very Concerned 17% Not At All Concerned 5% Don’t Know 13% Clearly, this is a significant hurdle that wearable technology companies will have to continue to address. We took a closer look at security concerns among current wearable owners, planned buyers, and those who don’t own/don’t plan to buy. Not surprisingly, respondents who already own a wearable technology device are less likely to say they’re Very Concerned (16%) about the safety and privacy of their personal information than either planned buyers (22%) or those who don’t own/don’t plan to buy (32%). This information is from ChangeWave Research, a service of 451 Research, LLC, and contains confidential business information. It may not be copied or distributed without permission. ©2015 451 Research, LLC. All rights reserved. 3 ChangeWave Research: Wearable Technology Trends Concerns About Safety and Privacy of Personal Information Current Planned Don’t Own/ Wearable Wearable Don’t Plan Owners Buyers to Buy Very Concerned 16% 22% 32% Somewhat Concerned 38% 47% 33% Not Very Concerned 30% 26% 13% Not At All Concerned 10% 4% 5% Don’t Know 5% 2% 17% Bottom Line. ChangeWave’s latest survey shows considerable future demand for wearable technology devices. Health and fitness monitors are the most popular type of wearable device consumers own, with FitBit the clear leader. But with all eyes focused on the impending Apple Watch release, the survey points to a surge of demand for smart watch devices going forward, along with continued strength for health and fitness monitors. Long Battery Life is the most important feature for planned smart watch buyers, but in a telling sign that shows interest in wearable devices is more than purely functional, Aesthetics/Design ranks as the next biggest consideration. This is a key difference from the early stages of other transformational mobile products such as smart phones and tablets. Despite the excitement around wearables, concerns about the safety and privacy of personal information on these devices is an issue for many consumers. Current owners are less wary than either planned buyers or those who don’t own/don’t plan to buy, but even current owners have their concerns – raising the question as to whether the safety and privacy of personal info will hinder growth of the wearable technology industry. It remains to be seen whether wearables become the next revolution in mobile devices – following in the footsteps of smart phones and tablets – but we’ll be keeping our finger on the pulse as the market develops. This information is from ChangeWave Research, a service of 451 Research, LLC, and contains confidential business information. It may not be copied or distributed without permission. ©2015 451 Research, LLC. All rights reserved. 4 ChangeWave Research: Wearable Technology Trends Summary of Key Findings Health and Fitness Excitement for Apple Most Important Monitor is Top Type Watch Drives Surge Features When of Wearable Device in Smart Watch Buying Smart Watch Long Battery Life (65%) Demand Types of Wearables Aesthetics/Design (44%) Consumers Own Future Buying Plans Wireless Connectivity (43% ) Health and Fitness Monitor 17% say they plan on buying Health/Fitness Monitoring (88%) a wearable device in the (42%) Smart Watch (16%) future Smart Footwear (3%) Wearable Device Smart Clothing (1%) Types of Planned Wearable Security Concerns Smart Glasses (0%) Device Purchases 28% of all respondents say Health and Fitness Monitor they’re Very Concerned Top Health and Fitness (53%) about safety and privacy of Monitor Manufacturers Smart Watch(51%) FitBit (65%) personal information on Smart Glasses (8%) wearable tech devices, and Nike (7%) 36% Somewhat Concerned Garmin (7%) Manufacturer Preferences: Current wearable owners Jawbone (7%) Health and Fitness Monitor are less likely to say they’re FitBit (32%) Very Concerned (16%) than Jawbone (8%) either planned buyers (22%) Microsoft (6%) or those who don’t own/don’t plan to buy (32%) Smart Watch Apple (76%) Samsung (3%) The ChangeWave Research Network is a group of 25,000 highly qualified business, technology, and medical professionals in leading companies of select industries—credentialed professionals who spend their everyday lives working on the frontline of technological change. ChangeWave surveys its Alliance members on a range of business and investment research and intelligence topics, collects feedback from them electronically, and converts the information into proprietary quantitative and qualitative reports. This information is from ChangeWave Research, a service of 451 Research, LLC, and contains confidential business information. It may not be copied or distributed without permission. ©2015 451 Research, LLC. All rights reserved. 5 ChangeWave Research: Wearable Technology Trends Table of Contents Summary of Key Findings ............................................................................................ 5 The Findings .................................................................................................................. 7 (A) Current Ownership of Wearable Devices ..............................................................

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