At the other end of the scale is the upmarket smartwatch segment. Apart from Apple's products, sophisticated models include the Kairos Watch range, which was released by the South Korea-based company of the same name last year and retails from $499 to $1,199.

Looking like a conventional Swiss-made mechanical timepiece, the Kairos can display text messages, notify the wearer of incoming calls and interact with smartphones and tablets.

Early this month, LG Corp announced plans to upgrade its Urbane 2 smart watch with an all-metal design. It will have 4G LTE connectivity and high-quality voice controls. The South Korea-based electronics giant has yet to reveal a price range for the Urbane 2 or a launch date.

Leading Chinese companies are also moving into the market. Apart from Lenovo's Moto 360, Huawei started selling its high-end Huawei Watch in Germany last month.

Again, it looks similar to a mechanical timepiece but has all the "smart functions", such as texting and e-mail. Prices range from 399 euros ($453) to 699 euros. A Chinese launch date has yet to be announced.

"A large number of Chinese companies rush to do the same thing once a product is popular," Yu Chengdong, head of the consumer division at Huawei, said. "But most of them will be struggling in three to five years time. At Huawei, we stick to the rule of making only top-class products."

Today, the Chinese wearable industry is like a toddler just starting to learn to walk. Smaller players are likely to fall by the wayside as established brands eat up market share.

Only leading companies such as Xiaomi, which has a huge shipment of products and a large consumer base, will be able to work on the "small-profit-quick-return" rule.

"We expect the wearables market to become far more creative," Yang Yuchuan, deputy general manager of the wearables business division at Media Tek Inc, a leading tech company in Taiwan, said.

"China-specific wearable devices will continue to emerge on the market in the next couple of years from the big brands or even from startups."