The wearables market continues to grow, with Xiaomi and Apple leading among manufacturers, and Fitbit falling behind but still maintaining a strong customer base, according a new report from the International Data Corporation (IDC).

In the first quarter of 2017, manufacturers shipped 24.7 million wearable devices, up 17.9% from the 20.9 million units shipped during the same period in 2016. IDC includes smartwatches and fitness wearables in this count, but excludes smart glasses with AR and VR capabilities.

Xiaomi and Apple tied for first place, with 3.6 million devices shipped during the first quarter. Fitbit came in third place with 3 million shipments, Samsung was in fourth place with 1.4 million, and Garmin was in fifth place with 1.1 million, according to the IDC report.

During the fourth quarter of 2016, Fitbit in first place, with Xiaomi in second place, and Apple in third. The vast majority of Xiaomi’s wearables sales are in China, and it lacks brand recognition in the US.

“In terms of wearables we’re up 18% year over year. That’s still moderately strong. That’s a good place to be. When I look at this data, this is a market doing exactly what it needs to do, which is transform itself. We’re moving into this next phase where we need fitness bands to be more productive,” said Ramon Llamas, research manager for IDC’s wearables team.

Fitbit is in the midst of change, with customers seeking new options on their fitness bands, and this gave Xiaomi an opportunity to gain a foothold in the market with its inexpensives devices and for Apple to continue its position as a leading smartwatch provider.

SEE: Luxury brands going high-tech to compete against Apple and Samsung in smartwatch showdown (TechRepublic)

Fitbit is still a contender, however, with a user base of 50 million and corporate wellness programs with major employers such as Target. Fibit is partnering with Virgin Pulse and its more than 2,200 corporate clients around the globe, as previously reported by TechRepublic.

Manufacturers will be trying to add features that offer more, such as not just counting steps, but assessing data to tell the user how to have a healthier life and what they need to do better. “Is it to sleep sooner? Is it what time of the day is best for me to work out? Is it how to perfect my form when doing an exercise? That’s something I don’t know,” Llamas said.

The sensors that can do deeper body learning and understanding body signals are where the stakes lie in the future for manufacturers, Llamas said.

And manufacturers have an opportunity to operate across verticals, and not act as a silo. “There are things in adjacent markets that should be leveraged. Look at what’s going on in terms of personal digital assistants. The Alexas and the Googles of the world and Cortana. This is going to be the next step in computing, and these should be leveraged toward your wearable as well,” Llamas said.

Manufacturers of smartphones can take advantage of the market by offering cellular capabilities for a wearable device, he said.

And there’s a growing demand for watches that look like watches. Llamas calls them “invisible technology” even though the devices are visible. They’re the hybrid smartwatches, such as those manufactured by Fossil and Skagen that look like traditional watches. “It’s an emerging market. They’re bringing something missing from the world of wearables and that is fashion and design and style,” he said.

The top 3 takeaways for TechRepublic readers

  1. The wearables market grew 17.9% in the first quarter of 2017, compared to the same period last year.
  2. Xiaomi and Apple tied for first place for wearables shipped in the first quarter of 2017, with 3.6 million devices each.
  3. Fitbit fell to third place with 3 million devices shipped in the first quarter, Samsung was in fourth place, and Garmin was in fifth place.

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