Wearable device makers shipped more than 27 million units globally in the fourth quarter of 2015, an increase of nearly 127 percent over the year-ago quarter, IDC reported Tuesday.
Vendors shipped a total of 78.1 million units in 2015, up 171.6 percent over 2014, according to the "Worldwide Quarterly Wearable Device Tracker" report.
While fitness trackers from companies such as Fitbit, Xiaomi and Garmin have dominated the market, the future for wearables will expand beyond counting steps and calories, according to Ramon Llamas, research manager for IDC'swearables team.
"What is warranted is continued innovation and development. The market can only get so far with me-too and copycat wearable devices. End users expect improvement from what they have now, and new applications to spur replacement and increased adoption," he said.
"Historical data, like steps taken and calories burned, has been a very good start. Prescriptive data, like what else a user can do to live a healthier life, coupled with popular applications like social media, news and navigation, will push wearables further and attract more users," Llamas added.
Why Fitbit Is Beating Apple
One reason Fitbit is outpacing Apple in the smartwatch race is that consumers see Apple as nothing more than an expensive notification center, noted Jitesh Ubrani, senior research analyst for IDC Mobile Device Trackers.
"People don't quite see the value in smartwatches just yet. People understand the purpose of a Fitbit or a fitness tracker, but they don't understand the importance of a smartwatch," he told the E-Commerce Times.
"Fitbit does a better job at fitness tracking than Apple. Even if all [other] things were equal, battery life alone and price are enough to convince people to get a Fitbit over an Apple Watch," Ubrani said.
The Future of Wearables
The fitness tracker won't dominate the smartwatch market for long. As technology evolves and costs go down, he predicted a surge in smartwatch demand in the next three to five years.
Smartwatches will "be able to do everything a fitness tracker does plus a whole lot more. There's also going to be other features and other experiences that smartwatches will be able to provide. Now you can use it anywhere you go and don't need your phone with you all the time," Ubrani said.
Another aspect of fitness trackers are their superior battery power over an Apple Watch, which is a major selling point. The discrepancy in battery life will be reduced in the near future, he said.
"One of the improvements in battery life doesn't come from the battery manufacturers but from app developers. They're making apps now that consume less power, which will eventually lead to a better battery life," Ubrani noted.
Another big change in smartwatch technology is what the devices will look like in the future. Style is as important as function, especially as they're incorporated into a person's day-to-day life, said Billie Whitehouse, CEO ofWearable Experiments.
"Fashion and style is important. We're seeing all kinds of new materials crop up, and I think that's part of its evolution. It's going beyond these big boxes on our wrists," she told the E-Commerce Times.
"I think the word 'wearables' is a really strange word, in fact. I think you'll soon see the word wearables disappear and it'll just become clothing, a watch. It's already becoming easier to integrate this technology into clothing and wrist devices. It's becoming simpler and easier to use, and just part of our lives," Whitehouse added.
Fitbit's line with designer Tory Burch and Apple's partnership with Hermès are examples of the merging of function and fashion, Ubrani said.
"Fashion is definitely very, very important, and it's only going to get more important. We're seeing a lot of the smartwatch guys take a whole bunch of jewels or a whole bunch of gold and throw it on the smartwatch, but honestly I don't think that's going to work," he said.
Other developments in the wearables market will include security and biometrics, Ubrani said. Vendors also will incorporate payment systems such as Apple Pay into wearables.
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