Table of Contents
Executive Summary
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- Market expected to return to growth
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- Figure 1: Best and worst-case forecast for the value of mobile phone sales, 2009-19
- Android and iOS have strong, but different, areas of expertise
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- Figure 2: Brand personality – Micro image, November 2014
- Apple now nearly as popular as Samsung
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- Figure 3: Manufacturer of smartphones owned by consumers, November 2014
- A quarter of basic handset owners intend to upgrade
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- Figure 4: Intentions to own smartphones in the future, November 2014
- Potential owners willing to spend almost £100 on first smartphone
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- Figure 5: Amount non-smartphone owners are prepared to spend on a smartphone, November 2014
Issues and Insights
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- ‘Devices and services’ model could set brands apart
- The facts
- The implications
- Attracting first-time smartphone buyers
- The facts
- The implications
The Market – What You Need to Know
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- 2014 sees return to growth
- Mid-range increase on the cards
- Distribution set to centralise
- Quad play competition intensifies
- Some first-time targets remain
- 12-month contracts regaining popularity
Market Size and Forecast
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- Market expected to return to growth
- Chinese brands could boost mid-range
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- Figure 6: Value of mobile phone sales, 2009-19
- Figure 7: Best and worst-case forecast for the value of mobile phone sales, 2009-19
Channels to Market
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- Market to become more centralised
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- Figure 8: Retailer or network that consumers acquired their device from, November 2014
- Half of consumers still buy phones in-store
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- Figure 9: Channel used by consumers to purchase their device, November 2014
Market Drivers
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- Three quarters of UK consumers now own a smartphone
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- Figure 10: Ownership of mobile phones, January 2012-November 2014
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- Figure 11: Ownership of mobile phones, by age, November 2014
- Nearly three fifths of consumers now on post-pay contracts
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- Figure 12: Mobile subscriptions, by pre-pay and post-pay, 2008-13
- Growth of 24-month contracts may have peaked
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- Figure 13: Contract length, November 2014
- 4G coverage expands while work begins on 5G
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- Figure 14: 3G and 4G coverage in the UK, by mobile network provider, June and October 2014
- Waning demand for tablets likely to boost ‘phablet’ market
Key Players – What You Need to Know
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- Positive perceptions and widespread awareness bode well for Android
- Consumers less clear about Windows Phone proposition
- Cross-sector presence breeds trust for Samsung
- Nokia and HTC struggle to stand out
- Top two brands account for nearly half of adspend
- Mid-range focus while top-end scrap continues
- Doro delivering for older consumers
Brand Research – Manufacturers
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- Brand map
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- Figure 15: Attitudes towards and usage of selected brands, December 2014
- Key brand metrics
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- Figure 16: Key metrics for selected brands, December 2014
- Brand attitudes: Samsung has a strong overall brand image to entice consumers
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- Figure 17: Attitudes, by brand, December 2014
- Brand personality: Nokia struggles against more innovative brands
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- Figure 18: Brand personality – macro image, December 2014
- Apple has a desirable but exclusive image
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- Figure 19: Brand personality – micro image, December 2014
- Brand analysis
- Samsung’s strong image built through history and exposure
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- Figure 20: User profile of Samsung, December 2014
- Apple has a loyal fan base who are likely to buy despite higher cost
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- Figure 21: User profile of Apple, December 2014
- HTC’s smartphone specialism limits brand awareness
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- Figure 22: User profile of HTC, December 2014
- Nokia is seen as basic and outdated but may provide cheaper alternative
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- Figure 23: User profile of Nokia, December 2014
Brand Research – Operating Systems
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- Brand map
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- Figure 24: Attitudes towards and usage of selected brands, November 2014
- Key brand metrics
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- Figure 25: Key metrics for selected brands, November 2014
- Brand attitudes: Familiar Android OS wins consumers’ trust
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- Figure 26: Attitudes, by brand, November 2014
- Brand personality: Windows Phone struggles to create an upbeat image
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- Figure 27: Brand personality – macro image, November 2014
- Android and iOS have strong, but different, areas of expertise
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- Figure 28: Brand personality – micro image, November 2014
- Brand analysis
- Android noted for user-friendly attributes
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- Figure 29: User profile of Android, November 2014
- iOS is strong on style, but has a more exclusive image
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- Figure 30: User profile of iOS, November 2014
- Windows Phone has a weaker overall brand image than Android or iOS
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- Figure 31: User profile of Windows Phone, November 2014
Brand Communication and Promotion
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- Samsung and Apple accounted for 44% of market adspend in 2014
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- Figure 32: Top 10 mobile phone manufacturers, by adspend, 2013-14
- Battle of the operating systems
Launch Activity and Innovation
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- Mid-range battle heats up
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- Figure 33: Microsoft Lumia 640 XL, unveiled at Mobile World Congress, March 2015
- Figure 34: Sony Xperia M4, unveiled at Mobile World Congress, March 2015
- Apple achieves record iPhone sales
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- Figure 35: Apple iPhone 6 and iPhone 6 Plus handsets, launched September 2014
- Samsung prepares its response
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- Figure 36: Samsung Galaxy S6 edge, unveiled at Mobile World Congress, March 2015
- It’s about more than just the phone
- BlackBerry and Microsoft make software push
- 5G: The next tier on the spectrum
- Dyson smartphone battery life
- Doro targets untapped over-65 market
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- Figure 37: Doro Liberto 820, launched winter 2014
The Consumer – What You Need to Know
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- Twice as many using Android as iOS
- Samsung dominates Android handset ownership…
- …but Apple now nearly on a par
- Windows appeals to first-time owners
- Trust and familiarity key for buyers
- Penetration hits 75% but non-owners indicate interest in entering the market
- Awareness of affordability could be holding back first-timers
- Basic handsets now mainly ‘emergency-only’
- Dual-SIM potential
Operating Systems
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- Android still the dominant platform
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- Figure 38: Operating systems used by smartphone owners, November 2014
- More than half of Android users have a Samsung handset
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- Figure 39: Split of android operating system, by manufacturer of smartphone owned, November 2014
- Can Microsoft reverse its age bias and compete with Apple?
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- Figure 40: Operating systems used by smartphone owners, by age, November 2014
Manufacturer of Smartphones
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- Apple now nearly as popular as Samsung
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- Figure 41: Manufacturer of smartphones owned by consumers, November 2014
- Combating the threat posed by Chinese brands
Stage of Ownership
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- Two fifths of smartphone owners are still using their first device
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- Figure 42: Stage of smartphone ownership, November 2014
- Half of Windows users still using their first smartphone
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- Figure 43: Stage of smartphone ownership, by operating system used by smartphone owners, November 2014
Purchasing Influences
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- Brands can look to break the habit
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- Figure 44: Reasons for choosing smartphone owned, November 2014
- Apple users demonstrate the most brand loyalty
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- Figure 45: Reasons for choosing smartphone owned, by manufacturer of smartphones owned by consumers, November 2014
Non-Smartphone Owners’ Intentions
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- A quarter of basic handset owners intend to upgrade
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- Figure 46: Intentions to own smartphones in the future, November 2014
- Bringing back human advice
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- Figure 47: Intentions to own smartphones in the future, by age, November 2014
- Gaining connectivity is potential owners’ main motivation
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- Figure 48: Features most wanted by potential smartphone owners, November 2014
First-Time Buyers
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- Potential owners willing to spend almost £100 on first smartphone
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- Figure 49: Amount non-smartphone owners are prepared to spend on a smartphone, November 2014
- Microsoft could attack low-end with favoured Nokia brand
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- Figure 50: Amount non-smartphone owners are prepared to spend on a smartphone, by age, November 2014
Reasons for Not Owning Smartphones
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- Price still a barrier, at least in consumers’ minds
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- Figure 51: Reasons for not owning smartphones, November 2014
- Smartphones as incentives
Attitudes towards Mobile Phones
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- Consumers ‘prepare for the worst’ with backup handsets
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- Figure 52: Attitudes towards mobile phones, November 2014
- Multiple user accounts
- Room for an extra SIM
Appendix – Data Sources, Abbreviations and Supporting Information
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- Data sources
- Abbreviations
- Fan chart forecast
- Brand research
- Brand map
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