From Fitbit to Samsung, smart wearables makers steer the fitness curve

As more and more Indian consumers buy into health and wellness as a lifestyle choice, Fitbit, GOQii, Titan, Samsung, Xiaomi look to set the rules of the game

A few weeks back, smart wearables maker GOQii Technologies slapped a legal notice on Flipkart, accusing the homegrown e-commerce giant now backed by Walmart of deep discounting its products and unfair practices. Flipkart has denied the allegations, but tensions continue to simmer as GOQii founder and CEO Vishal Gondal has refused to back down. Step between the battle lines and what emerges is the bustling marketplace of brands that the wearables sector has become. Apart from one of the earliest global entrants into the space, the San Francisco-headquartered Fitbit that has yielded space to a bunch of new local and global entrants, Xiaomi, Samsung, Titan, GOQii and Fossil are among the big brands mining the space.

Smart wearables have had two successive quarters of double-digit growth. A total 102,000 units were shipped in the quarter ending 2018, the first quarter to hit the 100,000 units mark for the country, according to International Data Corporation (IDC). The overall India wearables market saw a 17 per cent year-over-year (YoY) growth in the third quarter of 2018 and according to industry estimates, closed at 3.76 million units and Rs 1,450 crore in terms of value in 2018-19.

The fastest growing categories are below Rs 3,500 and above Rs 10,000, the mid-segment has been sluggish because companies say it is tough to balance promise with efficiency at these price points. The lower end of the price segment is driven by fitness brands and activity trackers and while the premium band is driven by smart watches.

These are heady numbers and wearables brands are looking at ways to leverage the boom. One way is to position the brand within the experience matrix. Vishal Gondal, CEO and Founder, GOQii said his company as a tech player, not fitness or a wearables maker and his product is a holistic wellness brand. The company uses a subscription-led model and instead of promoting a product, it offers a health package that customers sign up for. This offers better margins and ensures customer loyalty, the company said, while catering to the experience-hungry millennial.

Subscription led brands build their promise through partnerships and long-term deals, not discounts and offers. This explains the GOQii-Flipkart furore over discounts. Recently GOQii Play, the company’s OTT platform for healthcare partnered with Paytm First, a subscription-based rewards and loyalty programme.

The aim is to get long term customer buy-in, Somprabh Singh, business head- Wearables at Titan said. His research showed that while the adoption of a new technology was fast in smart watches, consumers were also exiting the category in the same pace. Design, convenience and battery life were the big differentiators; this is why the company offered one week battery life when it launched Titan Juxt. For Fastrack Reflex, it focused on easy charging solutions and add-on conveniences. Singh says that they worked hard to understand the customer and have launched 10 products so far under Titan, Fastrack and Sonata. Titan has also used the brand’s association with fitness to create engagements in sports and contests. Last year Titan grew by over 100 per cent in the category says Singh who hopes to keep the momentum going.

The biggest player in the market today is Xiaomi, it is the market leader and has kept its nose ahead for the fifth consecutive quarter with 41 per cent market share in 2018Q3. It is followed by GOQii, Titan, Samsung (replaced Fitbit) and Fossil, according to IDC. It has used its community (of smartphone users) to spread the word about its product, linking the two in a common experiential arc.

Raghu Reddy, head of Categories and Online sales, Xiaomi India said that the brand has grown through word-of-mouth promotions, driven mostly through its communities and social media networks. Its wearables portfolio includes the Mi Band 3 priced at Rs 1,999 which helps track every move and get round-the-clock health management and a key feature is its battery life, up to 20 days.

The brands have carved up the market according to price and age-group, while expanding their base in the top eight Indian cities that account for the largest slice of the pie. Demand for affordable products is largely seen from the age group of 20-35, however, for the premium segment, the target audience is between 25 and 45 years.