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Mobile data allowance grows in importance among smartphone owners

Recent research conducted by GfK NOP shows that, among smartphone owners, mobile data allowance is more important than the network operator and the handset type.

From previous posts on TechTalk we’ve shown how the use of mobile apps shows no sign of abating and that the tight integration services on the iPhone drives Apple’s smartphone success. This thirst for apps and services is the reason why smartphone owners are placing greater importance on their mobile data allowance. Smartphone owners now rely on the services their phone provides and taking these away is not an option.

With many UK operators having recently capped their data allowances smartphone owners will think carefully about their next mobile tariff. GfK NOP estimates that 24 per cent of contract customers using smartphones would actually switch operators if they could get a better mobile data allowance elsewhere.

The decision to cap mobile data usage is a sensible one as the major UK network operators have millions of customers who depend on a reliable mobile network. However, in doing so, network operators need to consider the mindset of the consumer. The average mobile phone user including many smartphone users simply don’t know how much data they use. Those who require a data allowance will always prefer an ‘unlimited’ package for peace of mind. Now that ‘unlimited’ data is coming to an end, consumers will look for the safest option; in other words the operator offering the most generous package.

It is easy to see why smartphone owners react this way when you look at the level of importance they place on using services on their mobile phone. Table 1 (below), shows the level of importance consumers place on mobile services in their day-to-day routine:

Table 1: Importance of mobile service usage

There is clearly a stark contrast between the UK average mobile consumer and smartphone users. Given this huge difference in attitudes it is little wonder the extra emphasis smartphone users are placing on mobile data tariffs. The biggest challenge for network operators over the next few years is how they cope with the increasing demand for smartphones and the increase in data usage this will inevitably bring.

This research was conducted in association with Reuters who have published a thorough market analysis here

If you have any questions or comments regarding the research please click here to email us or leave your opinion in the comments section below

RESEARCH NOTES

Research was conducted by GfK NOP in association with Reuters between 16 – 19 July 2010
978 interviews were conducted online among UK adults aged 16 and over. The sample is representative of UK adults with internet access.

Connected Kids: the future generation of mobile owners

Mobile phone users under the age of 16 are extremely sophisticated, with deep brand experiences and preferences. This raises significant questions for network operators, handset manufacturers and service providers regarding how best to engage an increasingly important market segment.

You could be forgiven for a sense of déjà vu. After all, rising mobile phone use amongst children is not a new phenomenon. As long ago as 2004 the Guardian was reporting growth in ownership amongst under-10s, [1] and media coverage concerning potential health concerns can be traced back even further. However, our ever-increasing reliance on, and immersion in, mobile phones and the digital services we use them to access, justify revisiting the topic.

Recent data from GfK reinforces just how prevalent mobile ownership amongst under-16s has become (2.5 million 12-15 year olds, almost 9 in 10, now have one). Furthermore, this is the age group cementing the shift in behaviour from passive entertainment, such as television, to more active digital and online activities. [2] As such, it should come as no surprise that the value placed on their mobiles increases accordingly.

It would be easy to assume these younger consumers are neophytes, new to the category with few preconceptions. Not the case. While 12-15s may be the first to acknowledge the importance of the technology, many of them are the same children the Guardian was reporting on five or more years ago. Instead, as many as 85% of those acquiring a phone are already on (at least) their second handset, and already hold the assortment of brand perceptions that follow this prolonged involvement in the category.[3]

As established users, with a penchant for advanced features and functions (camera, music, and games usage are all high, alongside social networking, IM, and email), it comes as no surprise that entry-level handsets have limited appeal. While the majority (70%) of phones in this age group are being gifted, three-quarters (74%) of users were involved in the selection process, with medium and high-end handsets flourishing and above average spending. [3] Unsurprisingly therefore, style and functionality will be key to handset manufacturers, for whom it will be necessary to attract the end-user as much as the purchaser.

The scenario facing operators is less clear. Selection of network and tariff, nominally a decision of less outward importance to younger consumers, remain primarily the domain of the purchaser (in contrast to handset, just 49% and 45% of 12-15 year olds influenced the choice of network/tariff respectively). How then, do operators approach these consumers? Given their focus on handset, clearly an appropriate and desirable range is a prerequisite. Beyond this however, high levels of gifting and relatively low interest in network/tariff imply it’s the gifter, as much as the end-user, who needs to be won over.

Mary Robinson at GfK Telecoms Research Panels highlights the importance of the under-16 market for network operators:

“Recent GfK findings for contract phones show that 83% of adults replacing their mobile chose to remain on the same network as before. With such high levels of loyalty in the adult market, the product propositions and brand experiences of the under-16s become massively important. Ignore them at your peril.”

Ultimately, when this generation hits adulthood and consumption becomes self-sustained, they will already be sophisticated mobile users consuming a range of services and content. Harnessing their demand will be a key revenue stream in the future mobile marketplace, and the brand preferences already developing will play a significant role.

For handset manufacturers, operators and service providers, the prize is a significant one.

For more information on the under 16 telecoms market please click here

[1] http://www.guardian.co.uk/technology/2004/apr/28/mobilephones.uknews

[2] http://www.statistics.gov.uk/cci/nugget.asp?id=2199

[3] GfK Research Panels: Kids Mobile Phone Market Report Q110

PHOTO COURTESY OF:

http://www.flickr.com/photos/uberculture

The Green Technology Revolution

Smartphone technology paves the way for the market to adopt greener approaches. Encouraging greater use of mobile services helps to limit the need for multiple devices, extend the product lifecycle and offer consumers more ways of being green.

“Technology companies can never be green”. A casual comment dropped into conversation when discussing the idea of ‘green technology’. Of course, ‘green technology’ already exists in the form of multi-million pound, global scale projects that help reclaim water, produce renewable energy and generally help meet global climate change targets. Green technology, as it stands, does not mean the ‘greening’ of technology.

Making technology a little greener would mean creating a shift in the way that technology products – consumer ones that is – are used and consumed. My argument is that the first steps to any greening of the consumer technology space would be lengthening the product lifecycle. Today, the very nature of the market tells a tale of rapid uptake and obsoleteness; parts break or newer, quicker, more innovative versions come along leaving many devices left for good old Mr. Landfill. Looking at the wider consumer landscape, which is successfully adopting greener behaviour, it seems like the right time for technology to adapt.

Recent data from a GfK NOP Technology survey amongst a representative sample of UK adults* which asked about attitudes towards everyday technology products like MP3s, PCs and mobile phones revealed that obsoleteness is not a desirable feature. When it comes to mobile phones specifically, more than half (56%) say that they are more interested in keeping their device for longer. This offers an opportunity for the rapidly growing mobile services industry. More on this later.

The finding is reflective of wider concerns about the environment and suggests a growing demand for a greener technology market. In particular, 41% of consumers want to know more about what their mobile phone brand or network is doing to be more green in order to help make decisions about future purchases. Consumers now have more choices than ever before to help ‘being green’ more easy, but whether technology products can add to the offering remains to be seen.

Enter the smartphone, which according to Gartner, Inc saw sales growth of 48.7% across the global market in the first quarter of 2010. Smartphones bring mobile services to the lives of consumers which Mobile Marketer estimate will be worth $1 trillion by 2013. Services available through smartphone technology are already a valuable commodity for global technology companies including Apple, Microsoft, Google and Nokia who, despite raging patent war,s are rolling apps, music, messaging, maps and other everyday ‘services’ the mass market might desire over 3G and wireless networks.

The benefits of mobile services extend beyond helping consumers rely more on their mobile phones. In particular, our research reveals that 40% of consumers are more interested in updating the services they use on their mobile phone than the device itself. This figure is not only music to the ears of software developers, network providers and mobile manufacturers who are diversifying into this services market, but also to consumers looking for more ways of being green. Services can extend the product lifecycle through satisfying a wide variety of consumer needs when it comes to technology. They can be updated and replaced regularly and help transform mobile devices into a highly personalised experience. Not only this, but due to the way that they bring a variety of functions together, e.g. camera, music player, clock, etc, they reduce the need for multiple technology devices. All of which contributes a ’greener’ technology market.

However, mobile services can not only help limit environmental impact of products, they also encourage and enable greener consumer behaviour and offer more choices for a greener lifestyle. Nokia, the world’s leading mobile manufacturer, is helping demonstrate how. Kirsi Sormunen, Vice President of Nokia Environmental Affairs, says that the company is continuously looking at “new ways in which mobile technology can contribute to sustainable development,” as well as “ inviting consumers to the journey towards sustainability.” To support this they have created a series of videos demonstrating and hinting at ways that using a mobile phone with internet access is yet another way of ‘being green’.

The videos show mobile phones helping us to help the environment through reducing travel, browsing the internet and carrying an all-in-one device. Nokia is not new to the move to making technology more green. The company came top in Greenpeace’s guide to consumer electronics earlier in the year. Their progression from making the manufacture of handsets more green to making the relationship between consumers and their devices more green, is an encouraging move for the technology market.

With the rapid uptake of smartphones, according to Gartner Inc figures, 54.3 million units globally are already helping people use their mobile phones to access the internet and services, limiting the need for multiple and separate devices. A green revolution in consumer technology has already begun, particularly where consumers want to keep their mobile devices for longer. Despite the global giants of Google and Apple being the pioneers of smartphone technology, it is companies like Nokia who have already realised the environmental benefits of mobile services who are paving the way for the greening of technology.

2010 Tech developments: keep it simple

In recent weeks, so much has been said about what 2010 will bring to the tech landscape that one can’t help but reading with a pinch of salt. For someone that works with customer opinions and observes their behaviour for a living, it becomes apparent that some of the predicted products and services, if they do make it to market, are destined to remain within that niche group of technology enthusiasts that created them in the first place.

Many of course have potential, and if implemented and marketed correctly have high chances of making it to the wider masses. That is, if they were ever intended to do so.

So – what is going to really work?

The answer is, well.. simple. Or, rather: simplicity. If given a choice, customers will always choose and glorify products and services that will offer them “more” in less time and with fewer headaches, the tools that empower them to reach a given goal with the minimum of disruption.

Luckily, optimization and simplification are recurrent themes in some of the predictions we stumbled upon:

“Third-party authentications will become the norm” (RWW). Trying to remember your password and login for the multitude of sites that request it will be a thing of the past – unless of course, you choose to be among the 46% of British internet users, 15.6 million that have the same password for most web-based accounts
Google will launch an inexpensive netbook powered by their new Chrome OS, with one goal in mind: accessing the web (IB-Times). Chrome OS is not meant to replace any of the existing operating systems (Google), and neither is it trying to do too many things; quite simply it is aimed at accessing the web, easily, and fast;
Others browsers will copy Google Chrome’s features the simplified interface, the rapid development model, the lightweight extensions, sandboxing, compiling JavaScript code;
“There are too many worthless apps and no adequate ways to find the good ones” (RWW) – this is certainly true of the i-Phone in particular, but also of the Android market. The count of apps is going up, but how do we spot the good ones?
More consumers than ever will demand the ability to easily interact fully with the mobile web on their phones;
Optimisation and stability, rather than raw speed, will acquire a position of relevance in computing. Examples have been set by Snow Leopard already. It will be a tough one as consumers will keep looking at the “higher number” (i.e. processor speed);
There will be more attempts at groundbreaking interfaces, possibly still involving touch screen technology;

Innovation extends the number and type of goals that are possible; success is then dependent on these goals being relevant and simple to achieve.

Though functionality is of paramount importance, a non-intuitive user interface will by definition reduce the number of people that will go through the trouble of learning it and using the tool in the first place.

As technology progresses, the number of options increase. The difficulty lies in how companies use those new solutions and advancements. One may choose to allocate the additional processing power available via a faster processor to run more complex operating systems, more demanding applications and fancy transition graphics in their next generation product. Another may instead choose to re-think, improve, un-clutter, optimise, speed-up.

One thing is certain: the customer will always win in the end, and they’ll win by choosing the “naturally best” fit with their way of thinking. So those innovators in the industry that really think like their customers are likely to be most successful.

NOTES

Image provided by:

http://www.flickr.com/photos/aussiegall/ / CC BY 2.0

We7 and Mopay team up: Music to environmentalist’s ears

Despite the continuing efforts of manufacturers, it seems that we the consumer are still not recycling our old mobile phones. Research by GfK NOP way back in 2007 first highlighted the problem of consumer lethargy but since then recent reports suggest there has been little improvement since.

An article by Telephony online for example, bemoans that:

“when a mobile phone reaches its end of life or, more likely, a consumer opts to upgrade, the three most common places for it to end up are a landfill, an incinerator or the consumer’s desk drawer. Nokia’s own studies find that only about 3% of consumers are recycling their handsets today …there could be as many as one billion sitting in desks, consumers aren’t spending the time or effort to seek out a recycling program.”

However, a collaboration between digital music website We7 and mobile recyclers Mopay may have identified a workable solution: Namely not relying on flaky consumer consciences and providing attractive incentives instead. We7 and Mopay’s new scheme enables visitors to mopay to swap unwanted phones for high quality MP3 files from We7’s download store to transfer to computers and portable music devices. With some mobiles worth in excess of £180, users can apparently turn the value of their old mobile phone into well over 200 downloads or around 30 albums. (Also, since We7 works in a similar vein to Spotify via ad-funded streaming, you will be able to listen to the music as much as you want for free before selecting the tracks to take with you.)

Now, this certainly sounds more appealing than hanging onto the 4 defunct handsets currently sitting in my bedside cabinet, ‘just in case of an emergency’… it will be interesting to see if it works.

GfK TechTalk

Independent technology research and opinion

Mobile data allowance grows in importance among smartphone owners

Connected Kids: the future generation of mobile owners

The Green Technology Revolution

2010 Tech developments: keep it simple

We7 and Mopay team up: Music to environmentalist’s ears

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