Unlocking consumer value

consumerlab
UNLOCKING
CONSUMER
VALUE
Identifying the needs of today’s smartphone
and mobile internet users
An Ericsson Consumer Insight Summary Report
May 2013
contents
METHODOLOGY
DIVIDE AND CONQUER
3
KEY FACTORS
4
PERFORMANCE SEEKERS
5
DEVICERS
6
VIPs
7
COST CUTTERS
8
CURIOUS NOVICES
9
CONTROL SEEKERS
10
Summary
11
This report identifies six target groups who all use
mobile internet in different ways and prioritize different
services. These groups have been defined based on the
results of qualitative fieldwork in Sweden, US, UK and Italy.
Each group places a unique emphasis on specific areas of
the mobile internet experience. In-depth interviews were
conducted to ensure qualitative results were achieved.
The defined target groups are based on attitudes and
what matters to them, not usage of specific services.
These attitudes become more stable over time, allowing
operators to better personalize their services and offers,
and even apply the findings to consumers that are about
to start using mobile internet.
Ericsson consumerlab
the voice of the consumer
Ericsson ConsumerLab has more than 15 years’ experience of
studying people’s behaviors and values, including the way they act
and think about ICT products and services. Ericsson ConsumerLab
provides unique insights on market and consumer trends.
Ericsson ConsumerLab gains its knowledge through a
global consumer research program based on interviews with
100,000 individuals each year, in more than 40 countries and
15 megacities – statistically representing the views of
1.1 billion people.
2 ERICSSON CONSUMERLAB UNLOCKING CONSUMER VALUE
Both quantitative and qualitative methods are used,
and hundreds of hours are spent with consumers
from different cultures.
To be close to the market and consumers, Ericsson
ConsumerLab has analysts in all regions where Ericsson
is present, which gives a thorough global understanding
of the ICT market and business models.
All ConsumerLab reports can be found at:
www.ericsson.com/consumerlab
DIVIDE and
conquer
The rapid uptake of smartphones
and other connected devices has
transformed the mobile broadband
landscape – shaping and
broadening the way users work,
play and communicate.
market, it is vital to differentiate
between consumers based on
what they prioritize in an offering,
whether that’s unwavering
performance or cost control
and data usage.
When the uptake of smartphones
begins to accelerate in a particular
This report outlines Ericsson
ConsumerLab’s findings and
details six different mobile
internet target groups. It can
be used to help operators and
developers better understand what
is important to their users. This
information can enhance overall
consumer experience and loyalty
by creating more value through
relevant services and offerings.
Key findings
> The online experience is
increasingly important –
The connected society
is becoming ever more
demanding, and as the
smartphone becomes
integrated into all aspects of
life, operators need to move
swiftly in order to match the
needs and expectations of
new and current users.
> Target groups value different
mobile internet features –
As technology matures, new
types of users with different
needs are entering the scene.
It is vital to address and treat
users differently in order to
provide the best individual
experience and make them
feel valued.
> F
our factors affecting
consumers – Examining
smartphone users shows that
there are four different key
factors that affect the overall
mobile internet experience
and relationship with the
operator. These factors
are: performance, price,
interaction and device.
> Operators should promote
areas other than price –
Price is something mobile
internet users can easily
compare between operators,
but comparing important
areas such as network
performance presents a
more challenging task.
Highlighting the importance
of this, and making those
other areas a part of the initial
purchase decision is vital to
building lasting relationships
with consumers.
Six different mobile internet target groups
PERformance seekers
DEVICERS
VIPs
COST CUTTERs
curious novices
CONTROL SEEKERS
Source: Ericsson ConsumerLab, Unlocking Consumer Value 2013
ERICSSON CONSUMERLAB UNLOCKING CONSUMER VALUE 3
key factors
Consumers select operators based on a number of key factors
– ranging from performance of the network, to value for money.
Target groups place emphasis on specific areas of mobile
internet, considering one or more of the following aspects:
Performance
Today, the quality of network performance is one of the most important factors
affecting customer loyalty to the operator. Therefore ensuring network speed and
reliability is fundamental to a trusting, long-term relationship.
PRICE
Value for money is a deciding factor for most when considering a smartphone
package. Being trapped in an unsuitable price plan can impact negatively on
the relationship and lead to churn, but a transparent, fair plan that is flexible can
positively impact the user experience.
INTERACTION
The relationship between operator and consumer is currently distant and a little
unfamiliar. Most users don’t experience an overly negative relationship, but the
personal touch is somewhat lacking, and the relationship is often peripheral
rather than focal. The relationship could be vastly improved through offering
loyalty rewards or personalized prices, which could effectively re-engage the
consumer and ensure improved satisfaction.
DEVICE
The devices that operators offer can be extremely important for certain
consumers. In particular, it’s important that operators carry the very latest
and sought-after models. Although the device does not directly improve the
relationship between the operator and consumer, it can be used to build on the
relationship through device-related communications, such as offering upgrades.
4 ERICSSON CONSUMERLAB UNLOCKING CONSUMER VALUE
Performance
seekers
Most important factors for Performance Seekers
My operator’s coverage
in Chicago is really good.
You can even be on
a train and you still
have a signal.”
Samir, Performance Seeker
Performance
Price
Interaction
Device
Source: Ericsson ConsumerLab, Unlocking Consumer Value 2013
The best possible experience to support connected lifestyles
The reliability and performance of a service is important
for a successful operator-user relationship. But for
Performance Seekers, it’s absolutely fundamental.
Members of this target group live and breathe technology,
and their device touches every part of what they do and
how they do it. Therefore providing a network experience
that is good, reliable and efficient could be the
difference between user satisfaction and churn.
They realize that everything can be achieved
through their connected devices, and therefore
look for operators who can deliver fast and reliable
mobile internet services.
RELIABLE
SERVICE
The fundamental
satisfaction driver for
Performance Seekers
ERICSSON CONSUMERLAB UNLOCKING CONSUMER VALUE 5
devicers
A phone is more than just a
phone – it’s a statement
For Devicers, a handset is far more than a means to
communicate. Their choice of smartphone expresses
their style of living, while the brands and products
they consume are directly linked to an aspired
social status.
Deciding which mobile phone operator and
subscription to have is not as important as the device
itself. The choice of provider can also be a direct result
of the device – with Devicers choosing the operator
that provides the right device for them.
Most important factors for Devicers
Performance
Price
Interaction
Device
Source: Ericsson ConsumerLab, Unlocking Consumer Value 2013
I really need to get the new iPhone as soon as it’s
available, it is so cool!”
Emilia, Devicer
upgrade
Having the perfect device
drives loyalty for this group
6 ERICSSON CONSUMERLAB UNLOCKING CONSUMER VALUE
vips
special treatment
VIPs expect acknowledgement and special rewards
Feeling valued is paramount
VIPs expect a level of service and performance that is
second to none, even if they might not always fully utilize
it. The relationship between the operator and the user is
vital for this group, and they demand superior treatment
at all times. VIPs are prepared to pay for a service that has
the right service level and doesn’t limit their experience
in any way. They need to feel like a premium consumer
and want all the perks that come with that – whether it’s
jumping queues or receiving personalized promotions.
Their mobile internet usage is rich and extensive,
making use of all types of apps and features throughout
everyday life. The use of mobile internet is not seen as a
luxury to VIPs, but more a necessity to maintain a level
of consumption that is in line with their lifestyle.
Most important factors for VIPs
Performance
Price
Interaction
Device
Source: Ericsson ConsumerLab, Unlocking Consumer Value 2013
I’ve been with my operator for years and I must say
that I like them very much. Maybe my operator could
acknowledge me somehow, that I am a loyal customer.”
Monica, VIP
ERICSSON CONSUMERLAB UNLOCKING CONSUMER VALUE 7
cost
cutters
I don’t see why I should
have to pay anything
extra for my subscription.
Internet is supposed
to be included.”
Irene, Cost Cutter
Always searching for the
cheapest possible alternative
Cost Cutters prioritize one
thing – price. They look
for simple, low cost plans
from honest operators
who will not surprise
them with additional
charges in the small
print. They are naturally
skeptical and constantly
on guard, not really
trusting their operator.
The device and the
service they use must
fulfill basic operations
and cover basic needs,
but must meet their
specific expectations,
allowing them to still do
the things they want.
Many of them are fine
with using an older
phone model or device,
as long as it doesn’t
hamper the experience
too much.
Cost Cutters use
mobile internet in
very different ways,
depending on their
priorities and needs.
Usage can be as rich
and frequent as any
other user group. This
group appreciates other
factors such as reliable
and good network
performance, but they
are not willing to pay
extra in order to improve
them – price is still the
primary focus.
Most important factors for Cost Cutters
Performance
Price
low prices
Cost overrules quality of service for this group
8 ERICSSON CONSUMERLAB UNLOCKING CONSUMER VALUE
Interaction
Device
Source: Ericsson ConsumerLab, Unlocking Consumer Value 2013
curious
novices
OPERATOR
SUPPORT
An important factor for Curious Novices
as they enter the communications evolution
Exploring recommendations
and appreciating support
Curious Novices are popping up everywhere, finding
their feet on digital platforms and discovering the
potential of connected devices. Curious Novices want
to become part of the media and communications
evolution but are unsure and uninformed about their
options. They look for devices that perform well and are
easy to use. They need to feel supported in the technical
side of things, so they appreciate friendly help and
advice. The relationship with the operator should
be a trusting, open and caring one.
Mobile internet usage varies greatly in this group.
Curious Novices consume data on a daily basis, but
some more freely than others. They use mobile devices
every day and expect everything to work seamlessly,
so a reliable service is fundamental to how they
consume mobile internet services, and impacts
how they will consume data in the future.
Most important factors for Curious Novices
Performance
Price
Interaction
Device
Source: Ericsson ConsumerLab, Unlocking Consumer Value 2013
It’s very frustrating when it takes four times the usual
time to do things on the iPad.”
Massimiliano, Curious Novice
ERICSSON CONSUMERLAB UNLOCKING CONSUMER VALUE 9
control
seekers
Cautious users who stay
on top of spending
Staying in control of mobile internet usage
and avoiding bad surprises is something Control
Seekers value highly. They are headstrong users who
have possibly had bad experiences concerning billing
and subscriptions. As a result, they are now cautious
in the way they use mobile broadband services.
Some users will even use trackers to keep a closer
eye on their usage, which helps to avoid financial
shocks when the bill arrives, and ensures data
usage is paced more effectively.
Although they like to keep a close eye on how
much data they consume, habits can vary within this
group, ranging from high to average usage. Control
Seekers restrict the use of certain devices and are
more likely to opt for pre-paid services which offer
more control over costs.
Customized
PLANS
Vital for those who wish to control
their mobile internet usage
10 ERICSSON CONSUMERLAB UNLOCKING CONSUMER VALUE
Most important factors for Control Seekers
Performance
Price
Interaction
Device
Source: Ericsson ConsumerLab, Unlocking Consumer Value 2013
I haven’t reached my limit
yet, but I’m very careful.
I pay an extra GBP 5 for
500 megabytes in case I do
go over. I try not to watch
videos that are too long.”
Dionne, Control Seeker
SUMMARY
Using a smartphone
is a vital part of many
consumers’ lives all over
the world. Their needs and
wants continue to evolve,
as do the demands for
faster, more reliable and
flexible mobile networks.
Of course, different
consumer groups require
different things, and
operators must handle
these expectations with
innovative solutions that
are tailored to specific
target groups, not specific
usage habits.
In addressing consumer
loyalty, operators must
build relationships
in the areas that are
important for multiple
target groups – be it
performance, value,
or service. If operators
manage to address the
areas that are important
to the consumer, they
will increase value for
users and ultimately build
stronger relationships.
SMARTPHONEs
A vital part of consumers’ lives
Inspired business opportunities
Understanding the target groups identified in this report
can help operators to tailor their offerings and increase
uptake in mobile internet services and usage. Whether
it’s providing better loyalty benefits for those who
demand constant attention, or improving data bundles
for the user who wants to keep control – effectively
How do operators deliver
a service Performance
Seekers will love?
Provide consumers with a
better way to evaluate network
performance. Allowing consumers
to see personalized performance
maps based on their commuting
habits would provide them with a
more individualized and relevant
network rating, which is important
when choosing an operator.
targeting the right user group presents the operator
with a number of opportunities. Below are three of
the many suggestions resulting from the study,
proposing how operators can address and improve
value for some of the identified target groups.
What makes Curious
Novices tick?
This dependent target group
can be helped by having a
personal telecom contact who
they can turn to whenever they
are overwhelmed by technical
problems. Having this personal
contact will help to build a
long-term relationship with
their operator.
What do Control Seekers
look for in an operator?
Assurance and the right to
return offers that are not living
up to expectations are highly
valued by Control Seekers.
Offering this type of flexible
service will greatly improve
the trust between operator
and subscriber.
ERICSSON CONSUMERLAB UNLOCKING CONSUMER VALUE 11
Ericsson is a world-leading provider of communications technology
and services. We are enabling the Networked Society with efficient
real-time solutions that allow us all to study, work and live our lives
more freely, in sustainable societies around the world.
Our offering comprises services, software and infrastructure within
Information and Communications Technology for telecom operators
and other industries. Today 40 percent of the world’s mobile traffic
goes through Ericsson networks and we support customers’
networks servicing more than 2.5 billion subscriptions.
We are more than 110,000 people working with customers in more
than 180 countries. Founded in 1876, Ericsson is headquartered
in Stockholm, Sweden. In 2012 the company’s net sales were SEK
227.8 billion (USD 33.8 billion). Ericsson is listed on NASDAQ OMX,
Stockholm and NASDAQ, New York stock exchanges.
The content of this document is subject to revision without
notice due to continued progress in methodology, design and
manufacturing. Ericsson shall have no liability for any error or
damage of any kind resulting from the use of this document.
Ericsson
SE-126 25 Stockholm, Sweden
Telephone +46 10 719 00 00
Fax +46 8 18 40 85
www.ericsson.com
EAB-13:026921 Uen
© Ericsson AB 2013