According to the research data analyzed and published by Comprar Acciones, global smart speaker shipments are projected to grow by 17% in 2020. From a total of 146.9 million units in 2019, it is estimated that over 170 million units will be sold in 2020.
According to Statista, the global market for smart speakers was valued at $11.9 billion in 2019. It is estimated to grow to more than $35.5 billion by 2025.
The market has not been immune to the impact of the global pandemic, seeing as annual smart speaker sales in 2019 grew a remarkable 70%. To a great extent, the effect was felt on the supply side during Q1 2020 when factories in China had to close down. Moreover, it took a hit due to the economic downtrend resulting from lockdowns.
Attesting to this, sales patterns in different regions varied significantly during H1 2020. For instance, in China, there was a considerable drop from Q4 2019 to Q1 2020. But in other regions, the drop was felt in Q2 2020.
China Smart Speaker Sales Drop by 300K Units in Q1 2020, Driving Global Decline
According to Strategy Analytics, a total of 28 million units were sold in Q1 2020. Though it marked an increase of 8.2% year-over-year (YoY), it was also the slowest growth rate on record. China was highlighted as the key factor.
US brands Amazon, Google and Apple collectively grew by 10% while Baidu, Alibaba and Xiaomi contracted by 5% as a group.
Chinese consumers bought 10.9 million units during Q1 2020, a drop of 300,000 compared to Q1 2019. In Q4 2019, total unit sales amounted to 13.08 million according to the International Data Corporation (IDC).
Amazon’s Market Share Drops to 21.6% in Q2 2020 As Baidu Sales Up by 171%
The IDC also reported a 7.2% YoY decline in overall smart home shipments in Europe, Middle and Africa (EMEA) during Q2 2020, predicting a rebound during H2 2020. Notably though, smart speaker sales during the period rose by 8.9% YoY in the region. Globally speaking, sales in Q2 increased by 6% quarter-over-quarter (QoQ) to reach a total of 30.0 million units.
Amazon’s Echo was the leading brand globally in 2019. However, its market share sank from 33.7% in 2018 to 26.2%. Though it held on to its dominant position in Q2 2020, its share was only 21.6%. Google came in second with a 17.1% share, while Baidu was third with 16.7%.
Similarly, Google’s market share dropped from 25.9% to 20.3% between 2018 and 2019. Its declining market share has to do with the sudden growth of Chinese rivals including Alibaba, Baidu and Xiaomi.
Together, Google and Amazon accounted for 75% of all 2019 smart speaker sales. In Q1 2020 though, Amazon, Google and Apple collectively only held a 47% market share.
In Q4 2019, smart speakers from Baidu, Alibaba and Xiaomi accounted for 30% of the global market. Baidu took the lead with a 10.6% share, while Alibaba was second with 9.80% and Xiaomi third with 8.4%. But by Q1 2020, the three collectively had a 38% share.
Similarly, in Q4 2019, China accounted for 29% share of the global smart speaker market, growing to 39% in Q1 2020. The same quarter saw a total of 55.7 million unit sales. Of this amount, Amazon sold 15.8 million units while Google sold 13.9 million units. That resulted in a combined market share of over 50%.
Baidu took third place with 5.9 million, Alibaba fourth with 5.5 million and Xiaomi was fifth with 4.7 million unit sales. While the figures for the three Chinese brands may not sound remarkable, it is noteworthy that they grew by 171%, 94% and 167% YoY respectively. On the other hand, Amazon was up by 16% YoY while Google rose by 20%.
Overall, China saw a total of 19.08 million speaker sales in H1 2020, an increase of 22.7% YoY according to All View Cloud (AVC). Related sales revenue amounted to $511.6 million, a growth of 18.6% compared to H1 2019. Alibaba, Baidu and Xiaomi accounted for a 95.6% market share in China during the period. The projected total for the country in 2020 is 42.6 million units, an increase of 15.7% YoY.
However, in the US, Amazon is expected to continue holding a dominant position in spite of its declining market share. According to eMarketer, 69.7% of all smart speaker users will use an Amazon Echo in 2020. This is a slight drop from the 2019 market share of 72.9%.
On the other hand, Google’s market share increased from 30.4% in 2018 to 31.1% in 2019 and will be at 31.7% in 2020. eMarketer predicts that this trend will continue. By 2021, Amazon’s market share will have dropped to 68.2% while Google’s will have grown to 32%.