RESEARCH REPORT
CONSUMER BEHAVIOUR TOWARDS PURCHASE OF SMART PHONES
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EXECUTIVE SUMMARY
• The research findings suggest that the most frequently used applications
are for communication – messaging, emails and calling – followed by
gathering information and social media
• The most important hardware specifications were camera, battery life,
durability and cross device synchronization
• Price and word of mouth – expert and buyer reviews, friends and
colleagues – notably influence purchase decisions
• An easy to use operating system is of key significance
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BACKGROUND
• The market research conducted for XXYYZZ Corp. was aimed at
understanding customer preferences regarding smart phone usage and the
applications most important to them
• The study was imperative in gaining insights about the features and
specifications most important to a smart phone user. Features tested for
include camera, OS, durability and design
• The objective was also to understand the factors that significantly
influenced purchase decisions of customers such as price, reviews, brand
and so on.
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METHODOLOGY
• The research conducted involved qualitative and quantitative
methods.
• A focus group study was conducted on May 16, 2017 at the
International Center on the UC Davis campus in Davis, California for 1
hr. and 30 minutes.
• All participants were between 18-25 years of age and possessed
expensive phones. This was the qualitative part of the research
• An online survey was conducted as part of the quantitative research.
The survey had 23 questions and nearly 600 responses were
recorded.
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RESULTS AND ANALYSIS
• Survey results were encoded and analysed using Excel
• Quantitative analysis - central tendencies, dispersion, association testing using chi
square test and causal analysis via regression
• The customer demographic identified (data shown in next slide) :
• Majority of participants between 25-44 years of age
• Minimum of a bachelor’s degree with many having a master’s
• Working professionals
• Equal number of Android and iPhone users
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Customer demographic
HIGHEST LEVEL OF SCHOOLING IN PARTICIPANTS CAREER OF PARTICIPANTS
60
70
60 50
Number of participants
Number of participants
50 40
40
30
30
20 20
10 10
0
0
Associate Bachelor's Doctoral High Master's Some
Consultant Manager Experienced Student Entry-level to Senior
degree in degree in degree school degree college
specialist or a few years management
college (2- college (4- graduate but no
Professional experience in or Leadership
year) year) degree
my work
Schooling level Career
AGE OF PARTICIPANTS PARTICIPANT PHONES SURVEYED
70
60
1%
Number of participants
50
40 Android
iOS (Apple)
30
48% Windows
51%
20
10
0
18 - 24 25 - 34 35 - 44 45 - 54 55 - 64
Age
The survey results indicate that the majority of participants were between 25-44
years of age, had a minimum of a bachelor’s degree with many having a master’s as
well, were working professionals and an equal number owned Android phones and
iPhones
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RECOMMENDATIONS
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1. Provide a straightforward and convenient operating system
ATTRIBUTES CONSIDERED WHILE PURCHASING A PHONE
100 90
90
80
70
Number of participants
60
50
40
30
20
10
0
OS is easy to use Looks great Durability Top quality Lower cost Quality service Easy cross-device Data security and Best in market Easy data sharing
camera provider synchronization privacy battery life
• User friendly, easy to use and easily navigable OS – most important pre purchase preference
• Focus - uncluttered and bloatware free OS with high customizability
• One of the biggest drawbacks of several systems today are unnecessary pre-
installed applications or bloatware. These unnecessarily occupy memory and are
often of little value
• Complex and cluttered interfaces do not make for pleasant user experiences.
Operating systems should ideally be designed to be functionally efficient but easy
to learn, use and manoeuvre. The more customizable, the better
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2. Integrate a high quality camera
ATTRIBUTES CONSIDERED WHILE PURCHASING A AVERAGE RATINGS FOR SMART PHONE ACTIVITIES
PHONE 5
4.5
Easy data sharing 4 3.65
Best in market battery life 3.5
3
Data security and privacy
Mean Rating
2.5
Easy cross-device synchronization 2
Quality service provider 1.5
1
Lower cost
0.5
Top quality camera 76 0
Durability
Looks great
OS is easy to use
0 20 40 60 80 100
No. of participants
• Take quality pictures and videos from a hand held device – saves cost of specific camera equipment
• Significant in a social media driven context
• The entirety of social media interaction relies on posting pictures and videos. Not
just this, but a high camera quality is useful to capture several important moments,
be it for personal or professional use, people or documents
• It has been observed that a smart phone that integrates an impeccable camera is
something people are willing to even pay extra for
• Case in point – one of the iPhone’s stand out features has been its consistently
better quality cameras, one of the major reasons its price has never been
begrudged
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3. Facilitate easy information flow
AVERAGE RATINGS FOR SMART PHONE ACTIVITIES
5
4.5
3.99
4
3.5
Mean Rating
3
2.5
2
1.5
1
0.5
0
Phone/video calls Texting Email and Gathering Social media use Games Taking Navigation with Consuming media Tracking health Other apps
Calendar information pictures/videos GPS and fitness
Smart phone activities
• Phones are hand held information sources – their most overlooked but essential purpose
• Make searching customized, efficient and fun
• Our phones are our most essential information sources, so much so that
“Googling” has become synonymous with searching for information
• This means that there is an impending need to ensure that the user gets to
experience new and innovative ways to look for information, in a way that
personalizes their experience and provides an efficient but enjoyable experience
• The emphasis of this observation can also be seen from the focus group
interaction
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4. Develop easy, fast and user friendly texting applications
FREQUENCY OF USAGE OF CELL PHONE APPLICATIONS Almost every hour
90
80 A few times a day
68
70 A few times a week
60
Number of participants
50
40
30
20
10
0
Phone and/or Texting and Email and Getting Social media use Playing games Taking and Mapping and Consuming Tracking my
video calls messaging Calendar information sharing pictures navigation media health and fitness
and videos
• Most frequently used application is messaging – almost every hour
• Provide innovative reply features – interact with and respond to messages without actually
typing anything
• As we can see from the graph, texting applications are heavily utilized. This was
also observed during the focus group session, where a majority of participants
expressed their love for fast, easy and innovative messaging. Those who had such
an experience with their phones deemed it an extremely important and enjoyable
experience.
• In a millennial driven society such as ours, even typing is fast becoming a nuisance
and it is imperative to develop and integrate methods that allow the user to
interact with messages beyond the conventional set up. An example is the way
Instagram allows users to double tap a text to show that they like it.
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5. Integrate seamless cross device connectivity
ATTRIBUTES CONSIDERED WHILE PURCHASING A PHONE
100
90
80
70
Number of participants
60 54
50
40
30
20
10
0
OS is easy to use Looks great Durability Top quality camera Lower cost Quality service Easy cross-device Data security and Best in market Easy data sharing
provider synchronization privacy battery life
• Access all data across different devices
• Provide strong cloud sharing and support
• For many people, usage carries across devices. In this case, a standardized cloud
interface that makes all the desired data available across the devices used by the
customer would be ideal
• While the survey does not indicate a majority, the focus group discussion indicated
that it was quite important to have a one size fits all.
• Having access to all possible data wherever you go and any device you use can do
wonders for all kinds of people –from students to working professionals
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6. Develop durable devices with enduring battery life
ATTRIBUTES CONSIDERED WHILE PURCHASING A PHONE COMBINED FEATURE LIST A phone with the best camera on the market,
durability, and stylish design
100
90
80
Number of participants
70 57 54 7% A phone with best on the market wireless
60 17% reception, durability, and long battery life
50
40
30
A phone with best on the market camera, battery
20
10 29% life, and wireless reception but is noticeably larger
0 and heavier than all other phones on the market
31% I would not be willing to buy a phone that costs
more than 90% of the phones in the market
16%
I would like to buy a premium priced phone, but
these feature choice combinations are not the
most important for me.
• Phones that resist damage, last long and have robust underlying software
• Good battery life can significantly impact usage – must be seriously considered
• Battery life is one of the most touted about features in any smart phone. A good
battery life has a definitive impact on productivity and ease of usage. It eliminates
the need for constant charging. However, the research indicates that, while
extremely important, it is not advisable to trade off processor speed for
exceptional battery. A poorly performing phone with great battery is of no use,
while the latter is still very much functional
• Durability includes resistance to common forms of damage, in addition to how
long the phone supports system updates and can function without glitches. This is
key when targeting higher price segments
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7. Prices matter and so do reviews
INFLUENCE OF DIFFERENT FACTORS ON CHOOSING A PHONE
160
140
13 19 16
120 28 28 35
Not influential
No. of participants
100 80 70 45
56
62
80 59 67 Somewhat influential
60 80
Very influential
40 50 79
51 70
58 52
20 45
19 24
0 11
Price Advertising Brand Seeing it in the Family Expert reviews Buyer reviews Friends and/or
store colleagues
• Reviews of fellow buyers and friends impacts purchase decisions
• Negative word of mouth can have disastrous consequences
• Price is clearly an extremely influential parameter while considering purchase. This
is true for a majority of participants. The focus group also indicated a similar
sentiment. However participants seem to heavily consider brand and the value
they get for their money, instead of just absolute pricing.
• Reviews of experts and other buyers are easily available through online platforms
and these can aid or deter purchase decisions. Word of mouth – both online and
through friends, colleagues etc. also plays a vital role in how a product is perceived
by customers.
• Example of negative word of mouth – Samsung
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