A recent Deloitte survey of mobile users around the world turned up both surprising and unsurprising reflections of the market.
Surprising? That app downloads have leveled off and even declined, which the company said points to app saturation among users and a mature market.
Unsurprising? The sharp divide between smartphone and feature phone users on price, and the fact that Wi-Fi use continues to grow.
The full Global Mobile Consumer Survey report examines the input from nearly 38,000 wireless users around the world, but Deloitte has made public some of the U.S.-specific data. This is the company’s third edition of the report offering insight into consumer purchasing habits, wants and trends.
Craig Wigginton, vice chairman and U.S. telecommunications sector leader for Deloitte, said that while there is still a lot of potential in the apps marketplace over the long term, the number of app downloads and per-app spending actually decreased between 2012 to 2013, with the greatest decrease coming from tablets.
“That one surprised me a little bit initially, but when you really think about it, I think what’s happening is a natural saturation in the marketplace with smart devices and the features, functions and apps that come along with them,” Wigginton said. “A lot of it comes around more sophistication in the process — it’s less of plaything.”
He said that when people initially bought smart devices and app stores were new, people downloaded lots of apps as they played around to figure out which ones worked the best for them. Core social media and commerce apps are likely to be pre-loaded on devices now, Wigginton added, and the ecosystem is maturing.
“People know what they want. They know what works, and they have things carried over or backed up now,” he said. He also noted that tablets have a longer product life than smartphones and as those devices have been around longer, people have settled on their app choices and have less need to download new apps regularly, particularly if they stay within a device ecosystem for upgrades. The decrease in app downloads registered at 13% among U.S. consumers, but was consistent across other countries including Brazil (downloads decreasing 36%), Argentia (down 17%) and Mexico (down 14%). Wigginton said the survey data still indicates that more than two mobile apps are being downloaded in a typical month, for more than $1 apiece — a mature market rather than a red-hot one.
“The toy factor has gone down a little bit,” he said.
Another interesting bit of data to come out of the survey was the sharp divide in how price sensitive feature phone owners are (yes, there are still plenty out there) compared to smartphone owners. Out of a list of nine important criteria in a wireless device, smartphone owners ranked price dead last, behind attributes such as battery life, size, brand and whether a device had a touchscreen. Feature phone owners ranked price as the first factor they consider.
Wigginton also noted a small but significant data point in near-field communication. About 10% of respondents had NFC payment capabilities on their phones — a small figure overall, but reflective of a 103% increase from the prior year. And of those who had NFC, more than a third had used it within the previous month. And of the 8% of survey participants who self-identified as early adopters of technology, nearly 60% had used NFC for mobile payments.
“It’s a small but loyal niche following,” Wigginton said — but he added that it may be the beginning of mobile payments finally gaining traction in 2014.
The survey revealed that Wi-Fi has come to dominate the mobile browsing experience to that point that 2/3 of consumers said that they most often connect their smartphones to Wi-Fi rather than a mobile network when using the Internet. U.S. customers also said that they would be willing to spend more to get faster speeds, with 41% indicating they would pay more for three-to-five-times faster speeds and nearly 10% willing to pay $30 on top of their current rates. Consumers who have already adopted LTE are more likely to seek out faster Wi-Fi alternatives.
For more information on the report, which also addresses BYOD trends, click here.
