In developed markets, mobile ownership has surpassed saturation, says Graham Brown, Mobile Youth analyst. High levels of prepaid ownership combined with multiple handsets and SIMs means that in some markets, such as the Middle East, it’s not unusual to see penetration rates of 300 percent in specific age groups such as students and young adults.
In most developed markets, youth spend 10 percent to15 percent of their disposable income on mobile phone services. Some 15 years ago, the figure was zero. Brown says That means they’ve forfeited spending on other goods and services.
In particular, you can track the decline of cigarettes, chocolates and CD spending against the rise of mobile spending and suggest that those areas have suffered as consumers shifted spending towards mobility.
Global recorded music sales peaked in 1999 at $40 billion. Cigarette use by teens in the United States peaked in 1998. Those might be direct consequences of greater mobility spending. The flipside of this is that to grow, mobile needs to displace spending on other products.
A direct consequence, Brown argues, is that further growth in youth segment telecoms must face a natural spending ceiling. For the most part, that means an emphasis on churn control. And on that score, most younger subscribers are much more tolerant than one might suppose.
"They want a service that is inconspicuous enough to work consistently in the background without their attention," says Brown. While a small percentage, less than five percent, are motivated by the latest offers and handsets, the majority of youth switch only when the network hits the “annoy” button.
No comments:
Post a Comment