[April 21, 2015]

Young, High Income Consumers Lead the Smartwatch Revolution

The Apple (News - Alert) Watch release could be the shot that sets smartwatch adoption off to the races. The opportunity is great: wearables owners today are gold-standard customers: high income, younger, and extremely engaged in digital banking, payments, and shopping. Smartwatches are unique devices, designed for lightning-fast and personalized interactions. Today, Javelin Strategy & Research released What Apple Watch Means for Banking and Payments which analyzes the first banking and payments wearable apps, interprets Apple's developer guidelines from a financial solution lens, and identifies the key features wearables owners crave.

Wearables are in the early stages of adoption, but that may start to change with Apple entering the ring. Today, 6% of all consumers own a smartwatch and 12% have a health-monitoring band. This level of device adoption is comparable to that of smartphones and tablets when Apple released the first-generation iPhone (News - Alert) and iPad. Moderate percentage point gains in consumer smartwatch adoption can be expected over the next year if the Apple Watch follows historical patterns. Javelin estimates Apple will ship 15 million Apple Watch devices its first year on the market.

"For Apple, the real test comes in the second year, when the 'fast followers' come on board. At that point, smartwatches are expected to net annual double-digit gains in overall consumer adoption," said Mary Monahan, Research Director - Mobile at Javelin. "All of this means that until 2016, consumer adoption will not likely be large for smartwatches even under optimistic models, but the desirable first adopter segment promises to be younger, wealthier and tech savvy."

Learn More: What Apple Watch Means for Banking and Payments

Related Javelin Research

• Investing in Wearables for Financial Services - Why Now?
• Biometrics in Banking and Payments: Versatile Voice Faces an Apple-Led Fingerprint Revolution

About Javelin Strategy & Research

Javelin Strategy & Research, a Greenwich Associates LLC company, provides strategic insights into customer transactions, increasing sustainable profits for financial institutions, government, payments companies, merchants and other technology providers. Javelin's independent insights result from a uniquely rigorous three-dimensional research process that assesses customers, providers, and the transactions ecosystem.

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