Table of Contents
Executive Summary
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- The market
- Smartphone market stays stable in 2019 but challenging times ahead
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- Figure 1: UK Mobile Phone market size and forecast (adjusted for COVID-19), 2014-2024
- 5G continues rollout as consumers become increasingly data-reliant
- Google ban to hurt Huawei sales in long-term
- Impact of COVID-19 on Mobile Phones
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- Figure 2: Expected impact of COVID-19 on mobile phones, short, medium and long-term, 30 April 2020
- Companies and Brands
- Apple and Samsung continue to dominate
- Apple launches iPhone 11 line-up with marginal upgrades on predecessors
- Samsung and Motorola offer foldable phones in the Galaxy Z Flip and Razr
- Apple dominates advertising of smartphone products in 2019
- The consumer
- Apple has highest customer loyalty
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- Figure 3: Brand loyalty for Apple, Samsung and Huawei smartphones, January 2020
- Six in ten people know at least a bit about 5G
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- Figure 4: 5G awareness and knowledge, February 2019 - January 2020
- Browsing social media ranks fourth in activities performed on a smartphone
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- Figure 5: Activities performed on a smartphone, January 2020
- Consumers least satisfied with battery life
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- Figure 6: Satisfaction with smartphone, January 2020
- Slight increase on upgrade intentions compared to 2019
- Ease of use ranks third behind price and quality when choosing a new phone
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- Figure 7: Purchasing factors of a new smartphone, January 2020
- Smartphone pricing still holding many consumers back
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- Figure 8: Influence of pricing on upcoming smartphone purchases, January 2020
- Over 30% of smartphone owners interested in buying foldable devices
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- Figure 9: Attitudes towards buying a foldable or keyboard-based smartphone, January 2020
- What we think
The Impact of COVID-19 on the Mobile Phones Sector
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- Short, medium and long-term impact
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- Figure 10: Expected impact of COVID-19 on mobile phones, short, medium and long-term, 30 April 2020
- Opportunities and Threats
- COVID-19 could boost sales among older generations
- Retailers can help with device set-up and usage
- Developing customer relationships with device replacements and longer return schemes
- Impact on the market
- Market to take a hit in 2020 but a return to low-level growth expected in 2021
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- Figure 11: UK Mobile Phones market size and forecast (adjusted for COVID-19), 2014-2024
- Production and supply affected by factory closures
- Event cancellations reduce opportunities to showcase latest models
- Shifts in consumer behaviour
- Consumers less likely to upgrade mobile phones in 2020
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- Figure 12: Intent to spend more or less on technology and communications products in next month, March 2020 – April 2020
- Online shopping is growing but lack of in-store experience is an issue for tech
- Impact on key consumer segments
- Gen Z and Younger Millennials least likely to be constrained in their spending
- Swing Generation also show potential to buy for the first time
- How a COVID-19 recession will shape the industry
- Consumers have lower confidence in their finances due to COVID-19
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- Figure 13: Value of mobile phone sales, 2008-13
- High unemployment will mean more dropping out rather than trading down
- Despite the gloom, the mobile phones market will not be among the worst hit
- Impact on the marketing mix
- COVID-19 could see manufacturers focus on the mid-range
- Physical stores will remain important despite increased acceptance of online-only shopping
- Smartphone brands’ responses to COVID-19 will be key to maintaining goodwill after the crisis
- Market context
Issues and Insights
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- COVID-19 to cause a drop in smartphone sales in 2020 but market should return to growth in 2021
- Popular smartphone manufacturers should offer lower-end devices with a focus on battery life
- The facts
- The implications
- Keyboard accessories for Android could appeal to younger consumers and mobile workers
- The facts
- The implications
The Market – What You Need to Know
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- Mobile phones market stays stable in 2019 but challenging times ahead
- Impact of COVID-19
- 5G continues rollout as consumers become increasingly data reliant
- Google ban to hurt Huawei sales in long-term
Market Size and Forecast
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- Smartphone market stable in 2019
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- Figure 14: Value of mobile phone sales in the UK, 2014-2019
- Outlook in the light of COVID-19
- Mobile phones set for a challenging year
- Market value to drop in 2020 as supply chain issues and consumer uncertainty take their toll
- Growth to return in 2021
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- Figure 15: UK Mobile Phones market size and forecast (adjusted for COVID-19), 2014-2024
- Figure 16: Value of mobile phone sales in the UK (adjusted for COVID-19), 2014-2024
- YoY growth had been expected in 2020 pre COVID-19
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- Figure 17: Value of mobile phone sales in the UK (pre COVID-19), 2014-2024
- Figure 18: UK Mobile phones market size and forecast (pre COVID-19), 2014-2024
- COVID-19 forecast economic assumptions
Market Drivers
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- Rise in SIM-only deals
- 5G rollout continues as consumers become more data reliant
- 5G coverage
- 5G pricing
- Significant improvement in video and game streaming
- Google ban to hurt Huawei sales in the long term
- Lack of Google services likely to be a deal-breaker for consumers
Companies and Brands – What You Need to Know
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- Apple and Samsung continue to dominate
- Apple launches iPhone 11 line-up with marginal upgrades on predecessors
- Samsung announces S20 series with a focus on cameras
- Samsung and Motorola offer foldable phones in the Galaxy Z Flip and Razr
- More 5G phones arrive in the market
- Apple dominates advertising of smartphone products in 2019
Market Share
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- Apple and Samsung continue to dominate
- Huawei continues growth despite spying allegations
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- Figure 19: Smartphone market share, February 2019 - January 2020
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- Figure 20: Apple and Samsung market share, by generation, January 2020
Launch Activity and Innovation
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- Apple launches iPhone 11 line-up with marginal upgrades on predecessors
- Apple also unveils lower-end iPhone SE
- Samsung announces Galaxy S20 series with a focus on cameras
- 8K video arrives, despite lack of devices to take advantage
- Screen size, 5G support, RAM and storage
- Samsung and Motorola offer foldable phones in the Galaxy Z Flip and Razr
- Samsung Galaxy Z Flip
- Motorola Razr 2019
- More 5G phones arrive on the market
- OnePlus 7 Pro 5G
- Oppo Reno 5G
- Samsung A90 5G
- Google launches Pixel 4 devices with design change and camera upgrades
Brand Research
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- Brand map
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- Figure 21: Attitudes towards and usage of selected brands, January 2020
- Key brand metrics
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- Figure 22: Key metrics for selected brands, January 2020
- Brand attitudes: Consumers see Apple iPhone as the most likely to deliver high quality
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- Figure 23: Attitudes, by brand, January 2020
- Brand personality: Samsung Galaxy seen as the most fun
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- Figure 24: Brand personality – macro image, January 2020
- iPhone most likely to be viewed as expensive
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- Figure 25: Brand personality – micro image, January 2020
- Brand analysis
- Apple iPhone delivers very high quality but at a cost
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- Figure 26: User profile of Apple iPhone, January 2020
- Samsung Galaxy beats iPhone in some areas
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- Figure 27: User profile of Samsung Galaxy, January 2020
- Trust in Huawei is lower than some competitors
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- Figure 28: User profile of Huawei, January 2020
- Many consumers aware of Google Pixel but few have used it
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- Figure 29: User profile of Google Pixel, January 2020
- Sony Xperia viewed as quite reliable and trustworthy
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- Figure 30: User profile of Sony Xperia, January 2020
- Consumers still lacking awareness of OnePlus
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- Figure 31: User profile of OnePlus, January 2020
- Lack of awareness and usage also a problem for Oppo
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- Figure 32: User profile of Oppo, January 2020
Advertising and Marketing Activity
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- Apple dominates advertising of smartphone products in 2019
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- Figure 33: Total above the line and online display advertising expenditure on mobile phones, 2016-19
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- Figure 34: Total above the line and online display advertising expenditure on mobile phones, 2016-19
- Figure 35: Advertising spend, by brand, 2019
- Nielsen Ad Intel coverage
The Consumer – What You Need to Know
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- More than eight in ten consumers own a smartphone
- Apple has the highest customer loyalty
- Six in ten people know at least a bit about 5G
- Browsing social media ranks fourth in activities performed on a smartphone
- Consumers least satisfied with battery life
- Slight increase on upgrade intentions compared to 2019
- Ease of use ranks third behind price and quality when choosing a new phone
- Over 30% of smartphone owners interested in buying foldable devices
Smartphone Ownership and Brand Loyalty
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- More than eight in ten consumers own a smartphone
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- Figure 36: Smartphone ownership, January 2020
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- Figure 37: Length of smartphone ownership, January 2020
- Apple has the highest customer loyalty
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- Figure 38: Brand loyalty for smartphones, January 2020
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- Figure 39: Brand loyalty smartphones, by Samsung, Apple and Huawei owners, January 2020
5G Awareness and Ownership
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- Six in ten people know at least a bit about 5G
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- Figure 40: 5G awareness and knowledge, February 2019 - January 2020
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- Figure 41: 5G awareness and knowledge, by generation, January 2020
- Almost 15% of consumers with a 5G-capable brand have a 5G smartphone
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- Figure 42: Ownership of a 5G capable smartphone, January 2020
Smartphone Activities and Consumer Satisfaction
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- Browsing social media ranks fourth in activities performed on a smartphone
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- Figure 43: Activities performed on a smartphone, January 2020
- Over 30% of smartphone owners use their device as a Wi-Fi hotspot
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- Figure 44: Tethering a smartphone mobile network, January 2020
- Consumers least satisfied with battery life
- Apple and Samsung beat the competition on most satisfaction measures
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- Figure 45: Satisfaction with smartphone, January 2020
Intent to Upgrade and Purchase Factors
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- Slight increase in upgrade intentions compared to 2019
- Men show greater interest in 5G than women
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- Figure 46: Intent to upgrade smartphone in next two years, February 2019 - January 2020
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- Figure 47: Intent to upgrade to a 5G smartphone in next two years, January 2020
- Ease of use ranks third behind price and quality when choosing a new phone
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- Figure 48: Purchasing factors for a new smartphone, January 2020
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- Figure 49: Purchasing factors for a new smartphone, for Apple, Samsung and Huawei owners, January 2020
- Smartphone pricing still holding many consumers back
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- Figure 50: Influence of pricing on upcoming smartphone purchases, January 2020
Smartphone Attitudes
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- Over 30% of smartphone owners interested in buying foldable devices
- Tablet replacement potential could increase willingness to pay
- Around a quarter interested in a smartphone with a physical keyboard
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- Figure 51: Attitudes towards buying a foldable or keyboard-based smartphone, January 2020
- A third of consumers consider privacy when buying a smartphone
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- Figure 52: Privacy concerns when buying a smartphone, January 2020
Appendix – Data Sources, Abbreviations and Supporting Information
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- Abbreviations
- Consumer research methodology
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