Smartwatches are at the peak of their hype cycle, and tech companies making early devices face years of flat sales, Justin Jungsup Lee, head of business development at LG, has warned.
Read this: Apple Watch - all you need to know
Speaking at the Wearable Technology Show in London, LG's top smartwatch mind took to the stage to address how smartwatch manufacturers could "cross the chasm" from appealing to early adopters to winning over the mass market.
"Not that many wearable devices have been sold. 20 million devices - that's just 0.04% penetration, and just 1% of the innovator segment. Crossing the chasm is the next step," Lee told a packed out room in the LG keynote.
He pointed to a host of problems preventing smartwatches from capturing the public's imagination:
"There are lots of technical barriers. Battery life is still close to smartphones, and the screen size is too small. Input is near impossible other than the voice, and it's still an seen as an accessory to the smartphone," Lee continued.
He also quoted a study into early adopters by Arun Kumar, summarising that:
"Early entrants face many years of flat sales and operating losses and, consequently, the scepticism of stock market analysts."
Read this: LG Watch Urbane - all you need to know
Lee pointed out that the smartwatch industry is being led by technology at present. Much of today's tech is being released not because there's a user need, but because tech companies have the means to make it. With lower costs, contract manufacturing and crowdfunding, it's possible for the first time to make devices without the need for huge sales.
For smartwatches to experience the same growth as smartphones, Lee said the market has to drive demand. That means aligning smartwatches more closely with traditional timepieces, in terms of style, as well as producing more devices to choose from and increasing product lifespans.
"It's a mindset change, making the watch a fashion item, rather than a gadget," Lee explained.
"The challenge is to align the smart devices with the watch world. When you switch from a functional device to a fashion device, it becomes very different. When you position [the smartwatch] as fashion, the marketing message becomes very easy."
So the key to making smartwatches a success means going big on style? That sounds very much like Apple's Watch strategy, as well as LG's own plan for 2015 with its newly released LG Watch Urbane.
"Apple's on the right path on with its marketing, using Vogue and making it a fashion item," he said, "which is in line with our own strategy."
2015 looks to be the year we start seeing stylish smartwatches on real wrists with launches expected from Fossil, Michael Kors and Swatch as well as Apple and LG. Which smartwatch would you wear?
How we test
James is the co-founder of Wareable, and he has been a technology journalist for 15 years.
He started his career at Future Publishing, James became the features editor of T3 Magazine and T3.com and was a regular contributor to TechRadar – before leaving Future Publishing to found Wareable in 2014.
James has been at the helm of Wareable since 2014 and has become one of the leading experts in wearable technologies globally. He has reviewed, tested, and covered pretty much every wearable on the market, and is passionate about the evolving industry, and wearables helping people achieve healthier and happier lives.