UK Consumers Hold on to Mobiles

The average British mobile phone owner has had the same phone for 20 months, compared to just 16 months a year ago, according to new findings from Taylor Nelson Sofres (TNS). This is bad news for handset manufacturers and retailers who have been relying on regular mobile handset upgrades as mobile phone penetration levels reach saturation point in Great Britain.

The research, carried out by TNS TeleComTrak (TCT), compared mobile phone ownership over the past 12 months to April 2002. It reveals that age is a significant factor in the length of time that consumers keep a handset. Twelve-24 year olds have had their phones for an average of 17 months whilst 35-44 year olds for an average of 21 months.

Derek McInnes, Head of TeleComTrak, commented 'Two years ago there was consumer demand for smaller, lighter more fashionable phones that worked well for voice calls, to replace the 'bricks' that were more commonly available - these compact handsets now dominate the market. While technological developments have continued, little seems to have caught consumers' imagination enough to drive upgrades at the same rate. The industry is desperately trying to find the next major driver for change but its current attempts don't appear to be having the desired effect. The hope is that colour displays, MMS (multimedia messaging services) or 3G services may stimulate the market again.'

However, the short-term news is not all bad. Around 70% (just under 10 million) of contract subscriptions have been active for over one year, so the focus on upgrades by the networks may prove fruitful.

There are also six million pre-pay handsets, purchased in the six months before Christmas 2000, which are still active. These are coming up to the 20-month mark so users may be looking to change their handsets. In order for mobile phone manufacturers and network providers to market their products effectively, it is vital that they understand their target consumer groups.

McInnes continued 'A significant number of people have a pre-pay phone which they bought during the boom of 2000 and they may be nearing the time when they wish to upgrade. These are mass market consumers, most of whom bought when phones were cheap. Their actions will have a significant impact on the market for the networks, as they try and upgrade pre-pay customers to more profitable contracts. However, about a third of these pre-pay customers are in the older age group category, that tend to hold onto their handset for longer. Mobile manufacturers and retailers must find ways to understand the motivations of this market and encourage them to upgrade. The telecoms industry has matured very quickly over the last year or so, and key players have learned that in any marketplace, products are bought to fulfil needs. What they have to identify now is the next consumer need, not the next technology.'

Taylor Nelson Sofres's TeleComTrak (TCT) is a panel consisting of a demographically and regionally representative, continous sample of 15,000 GB individuals. In addition to demographic and regional breakdown it also provides information on mobile phone ownership and purchasing.

All articles 2006-22 written and edited by Mel Crowther and/or Nick Thomas unless otherwise stated.

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