Beyond the wrist: From rings to AI pendants, next-gen wearables signal a rebirth for the segment

A device that sits behind your ear and reduces anxiety. A pendant that can record and summarise all your conversations. A ring that can pay for your shopping trips with one tap. 

New-age wearable devices are stepping out from the shadow of their ancestors and are gaining traction— from consumers and investors alike. 

Shark Tank fame mental health-tech startup InnerGize has raised Rs 6.5 Cr from Antler, Arjun Vaidya, Ritesh Agarwal, and government bodies, while payments ring brand 7 Ring has raised Rs 2.24 crore so far. NeoSapien, an AI-powered locket brand, has also raised Rs 80 lakh on Shark Tank. Meanwhile, Nexus Ventures-backed Ultrahuman is close to raising $120 million from Westbridge Capital and others, as per a report by MoneyControl. 

The Indian wearables market, which consists majorly of audio segments and smartwatches, has seen better days. After ballooning in the post-COVID era, it is currently in the middle of a slowdown. Shipments in the sector have declined for the first time ever in 2024. The sector, which comprises everything from hands-free audio devices, pedometers, to smart watches and fitbits, witnessed an 11.3% de-growth to 119 million units in the calendar year 2024, according to a report by IDC.

While other categories clocked a low-to-mid double-digit de-growth, the brunt of the slowdown was borne by smartwatches and fitbands. Smartwatches, which alone account for 35-40% of the total wearables category, saw their shipments fall by 34% during the calendar year 2024. 

“This category has independently lost its steam. Wearables are now nebulous as a category; they don’t really exist anymore. Today, it is simply a functionality packaged into smart electronics. Tomorrow, it may take another form altogether, such as a chip embedded or pasted somewhere, moving away from smartwatches into something else,” shares Ankur Bisen, Senior Partner and Head - Consumer, Food and Retail at consulting firm Technopak Advisors. 

With the core functions of a smartwatch also present in smartphones, laptops, and other personal devices, consumers are increasingly seeing them as redundant. The smartwatch segment is also struggling not only to set itself apart from broader tech products, but also from its own previous models. 

With little meaningful innovation and most new launches offering only incremental upgrades, the category is suffering from slower refresh cycles. Since the initial popularity boom was relatively recent, and there’s no strong reason to upgrade, companies are seeing fewer repeat buyers.

“If I put two smartwatches with a Rs 2,000 or Rs 3,000 price difference in front of you, you wouldn't be able to tell me what was the upside in one," adds Bisen. 

A lack of significant technological advantages, a slew of look-alikes and no particular reason to shift out of existing models has further fueled consumer saturation for the coverall category.

Wearables grow up: From trackers to solutions

The downturn in the wearables market is making way for a new category to emerge—one which is focused on solution-oriented devices over passive health data tracking. Startups are targeting deeper and specialised use-cases, in turn making the space more premium. 

Smartwatches and fitbands were primarily positioned around tracking health and wellness metrics. Products were marketed with features like sleep tracking, heart rate tracking and even SpO2 tracking, which measures oxygen in the blood. 

​"The smartwatch market in India is at a tipping point. People first bought them for style or fitness, but many didn’t end up using them as expected. Now, buying decisions have moved from impulse to utility. As AI integrates with advanced health features, the category is moving beyond just steps and heart rate," said Boult Co-founder Varun Gupta.

Consumers are now looking for more meaningful experiences and real-world functionality from wearables, instead of a diagnostic and tracking tool. 

For example, InnerGize’s device stimulates the vagus nerve located behind the ear using gentle electrical signals, helping reduce stress and anxiety levels. “Solution-based wearables are what the world genuinely needs. Today’s wearables have moved beyond monitoring and now essay an interventional role. To justify the tag of a health product, a wearable’s minimum viable outcome should be its ability to positively impact the wearer’s health,” explains Siddhant Bhargava, Co-founder and CEO, InnerGize.

Wearables are also venturing further out of the healthtech niche into other real-world applications. NeoSapien’s AI-powered pendant acts like a real-time notetaker, enabling users to record and transcribe conversations as well as go back to them for previous insights. 7 Ring enables contactless payments via a wearable ring linked to a digital prepaid wallet.

Innovation meets India’s price wall

Even this new category of wearables has to contend with a bigger problem plaguing the segment as a whole—price sensitivity.  During the wearables boom, smartwatch sellers were able to grab huge chunks of the market by being ultra-competitive with prices, even at the cost of selling their products at heavily discounted prices. 

“Smartwatches certainly have low margins, probably because the players leading the category went really aggressive to gain market share. But that market share didn’t translate into profits later on. Now, consumer expectations are set for entry-level prices—once you've bought a good smartwatch at Rs 1,200, Rs 1,100, or Rs 999, it's tough to push prices back up. So, the price expectation gets set,” says Paras Batra, Founder of audio and wearables brand Leaf Studios. 

“Most wearable companies do not make their own devices. And because of that, their pricing is completely reliant on the prices offered to them by Chinese manufacturers. The fear of being undercut by a competitor keeps them operating on razor-thin margins, which ultimately impacts feasibility,” adds Bhargava.

The new generation of wearable makers is moving away from the price war and razor-thin margin strategies. NeoSapien’s starting device is priced at Rs 9,999, while Ultrahuman’s sleep tracking AIR ring is priced upwards of Rs 28,499, along with an annual subscription for Rs 2,988. InnerGize’s Generation 1 device is priced at Rs 12,400, and 7 Ring is being offered at Rs 7,000, before any early-bird offers. 

“A Rs 7,000–Rs 10,000 wearable is a very expensive product for a functionality that’s still niche,” questions Bisen.

In a market as price-sensitive as India, to consumers who have been looking at watches under Rs 2,999, it raises questions about the scalability of these premium devices. 

However, Dhananjay Yadav, Co-founder and CEO at NeoSapien, believes, “In the premium segment of wearables, brand value and R&D matter far more than price. Players like Ultrahuman have increased prices to Rs 28,000 and still managed to maintain their position as market leaders. Indian consumers are increasingly willing to pay for original products with superior capabilities. The price wars are largely limited to the Rs 500 to Rs 4,500 mass-market range, which is dominated by white-label players.”

(With additional inputs by Debolina Biswas)