Table of Contents
Scope and Themes
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- What you need to know
- Definition
- Sales data
- Consumer survey data
- Advertising
- Abbreviations and terms
- Abbreviations
- Terms
Executive Summary
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- Smartphone sales account for nearly three-fourths of market
- Smartphone adoption and regular replacers drive market growth
- Groundbreaking technologies give consumers reason to upgrade
- Tablet PCs offer alternative but hybrid products are unlikely
- Major manufacturers vie for tech leadership in smartphones
- Android leaps ahead of Apple and Microsoft
- Innovations increase smartphone display, speed, and role as data center
- Television ads reflect various differentiation strategies
- Internet channel accounts for a third of mobile phone purchases
- Smartphone adoption shows momentum as well as resistance
- Wide range of smartphone uses show substantial adoption
- Purchase considerations reveal platform differentiation
- Varying consumer attitudes reflect platform weaknesses
- Interest in video calling and 4G phones strongest among under-35s
Insights and Opportunities
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- Young parents deserve more attention from marketers
- Thinking ahead to Boomers as a source of sales growth
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- Figure 1: U.S. population without smartphones, by age, 2011
- BlackBerry and Microsoft must defend with stronger brand identities
Inspire Insights
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- Trend—Affection
Competitive Context
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- Tablet PCs show sales momentum but phone functionality unlikely
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- Figure 2: Smartphone and tablet PC ownership and intent to buy, November 2010
Market Size and Forecast
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- Growing importance of mobile technology renders market recession-proof
- Sales and forecast of market
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- Figure 3: U.S. factory sales and forecast of mobile phones, at current prices, 2006-12
- Figure 4: U.S. factory sales and forecast of mobile phones, at inflation-adjusted prices, 2006-12
- Fan-chart forecast
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- Figure 5: Fan-chart forecast at 50-95% confidence levels, 2006-14
Market Drivers
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- Upgrades and replacements drive most purchases
- Smartphone adoption
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- Figure 6: Mobile phone ownership and intent to buy, November 2010
- Replacement cycle
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- Figure 7: Attitudes toward mobile phone replacement, by age, November 2010
- Groundbreaking new functionalities drive new purchases and upgrades
- 4G speeds
- Video calling
- Larger screens
- GPS services
- Ownership driven by need for social connectivity
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- Figure 8: Attitudes toward social uses of mobile phones, by age, November 2010
Segment Performance
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- Smartphone growth more than compensates for standard phone decline
- Sales by segment
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- Figure 9: U.S. factory sales of mobile phones, by type, 2008 and 2010
- Figure 10: U.S. factory sales of mobile phones, by type, 2006-14
Segment Performance—Smartphones
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- Smartphone utility drives upgrades despite recession
- Smartphone sales and forecast
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- Figure 11: U.S. factory sales and forecast of smartphones, at current prices, 2006-14
- Figure 12: U.S. factory unit sales of smartphones, at current prices, 2006-10
Segment Performance—Standard Mobile Phones
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- Factory sales of standard phones shrink but unit sales remain dominant
- Standard mobile phone sales and forecast
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- Figure 13: U.S. factory sales and forecast of standard mobile phones, at current prices, 2006-14
- Figure 14: U.S. factory unit sales of standard mobile phones, at current prices, 2006-10
Leading Manufacturers
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- User share shifts toward leading smartphone manufacturers
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- Figure 15: User share of top mobile phone manufacturers, Dec 2009-Nov 2010
- Top manufacturers vie for position in the new 4G smartphone market
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- Figure 16: Specifications of Android phones to be released in 2011, January 2011
Smartphone Platforms
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- Google leaps ahead as RIM and Microsoft tumble
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- Figure 17: User share of smartphone platforms, Dec 2009-Nov 2010
- Apple and Android see highest market momentum
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- Figure 18: Penetration and desirability of smartphone platforms, November 2010
- Apple leads among respondents 24-34 while Android nabs 18-24
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- Figure 19: Penetration and desirability of smartphone platforms, by age, November 2010
- Apple to maintain lead among higher-earners
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- Figure 20: Penetration and desirability of smartphone platforms, by household income, November 2010
- iPhone release on Verizon could boost Apple share
- BlackBerry’s lead greatest among large families
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- Figure 21: Penetration and desirability of smartphone platforms, by presence of children, November 2010
- Windows 7 launch makes little impact on top three
Innovation and Innovators
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- Smartphone becomes modular control center
- Oxygen Audio turns smartphone into car stereo
- Multi-core processors hit the market in 2011
- Displays continue to improve in resolution and brightness
Marketing Strategies
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- Television advertising
- Apple
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- Figure 22: Apple iPhone 4—Grandfather Video Call, television ad, July 2010
- BlackBerry
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- Figure 23: BlackBerry Style—Urban professions, television ad, November 2010
- Motorola (Android)
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- Figure 24: Motorola Droid Pro—Work phone, television ad, November 2010
- Samsung (Android)
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- Figure 25: Samsung Galaxy S—Avatar on the phone, television ad, July 2010
- LG (Android)
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- Figure 26: LG Vortex—Restoring carousel, television ad, November 2010
- HTC (Android)
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- Figure 27: HTC HD2—Morales family, television ad, October 2010
- T-Mobile (Android)
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- Figure 28: T-Mobile MyTouch 4G—Video call comparison, television ad, December 2010
- Online advertising
- Inventive social media campaigns complement traditional advertising
Retail Distribution
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- Bricks-and-mortar loses ground to the internet
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- Figure 29: Share of mobile phone purchases, by type of distribution channel, 2009 and 2010
- National chains and web-only retailers gain share
- Walmart
- Best Buy
- Web-only retailers
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- Figure 30: Share of mobile phone purchases, by distribution channel/retailer, 2009 and 2010
Ownership and Intent to Buy
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- Smartphone penetration poised to for significant growth
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- Figure 31: Mobile phone ownership and intent to buy, November 2010
- Boomers show greater resistance to smartphone ownership
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- Figure 32: Smartphone ownership and intent to buy, by age, November 2010
- Smartphones owned by more than half of highest-earners
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- Figure 33: Smartphone ownership and intent to buy, by household income, November 2010
Decision Factors
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- Smartphone buyers look for functionality over form
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- Figure 34: Considerations in the phone purchase decision, November 2010
- Purchase considerations reflect differentiation among platforms
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- Figure 35: Considerations in the phone purchase decision, by smartphone platform, November 2010
Smartphone Apps and Activities
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- Wide range of smartphone uses show substantial adoption
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- Figure 36: Usage of smartphone functionalities, November 2010
- Women more likely to use smartphone for social networking
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- Figure 37: Usage of smartphone functionalities, by gender, November 2010
- Under-35s most active smartphone users
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- Figure 38: Usage of smartphone functionalities, by age, November 2010
- iPhone users more likely to use mobile commerce
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- Figure 39: Usage of smartphone functionalities, by smartphone platform, November 2010
- Only a quarter of downloaded apps are paid
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- Figure 40: Number of apps downloaded and paid for, by key demographics, November 2010
Attitudes Toward Mobile Phones
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- A quarter of cell phone owners replace every other year
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- Figure 41: Attitudes toward mobile phones, November 2010
- Under-45s more likely to replace
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- Figure 42: Attitudes toward mobile phones, by age, November 2010
- Smartphone platforms offer different strengths
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- Figure 43: Attitudes toward mobile phones, by smartphone platform, November 2010
Other Attitudes Toward Mobile Phones
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- Interest in video calling strongest among under-35s
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- Figure 44: Attitudes toward video calling, by age, November 2010
- Resistance to mobile internet usage strongest over age 45
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- Figure 45: Attitudes toward mobile internet, by age, November 2010
- Half of parents see mobile phones as good gifts for teens
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- Figure 46: Attitudes toward mobile phones for kids, by children in the household, November 2010
Attitudes Toward Next-Generation Data Networks
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- 4G phones desired by a quarter of 25-34 year olds and high-earners
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- Figure 47: Attitudes toward next generation data networks, November 2010
Impact of Race and Hispanic Origin
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- Asian respondents more likely own smartphones and use certain features
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- Figure 48: Smartphone ownership and intent to buy, by race and Hispanic origin, November 2010
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- Figure 49: Usage of smartphone functionalities, by race and Hispanic origin, November 2010
- Asian respondents less likely to replace on a regular basis
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- Figure 50: Attitudes toward mobile phones, by race and Hispanic origin, November 2010
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- Figure 51: Attitudes toward video calling, by race and Hispanic origin, November 2010
Cluster Analysis
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- Simplists
- Demographics
- Characteristics
- Opportunity
- Enthusiasts
- Demographics
- Characteristics
- Opportunity
- Good-enoughs
- Demographics
- Characteristics
- Opportunity
- Cluster characteristics
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- Figure 52: Cell phone clusters, November 2010
- Figure 53: Attitudes toward mobile phones, by cell phone cluster, November 2010
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- Figure 54: Attitudes toward video calling, by cell phone cluster, November 2010
- Figure 55: Attitudes toward mobile phones for kids, by cell phone cluster, November 2010
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- Figure 56: Considerations in the purchase decision, by cell phone cluster, November 2010
- Figure 57: Attitudes toward mobile internet, by cell phone cluster, November 2010
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- Figure 58: Attitudes toward next generation data networks, by cell phone cluster, November 2010
- Cluster demographics
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- Figure 59: Cell phone clusters, by gender, November 2010
- Figure 60: Cell phone clusters, by age, November 2010
- Figure 61: Cell phone clusters, by household income, November 2010
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- Figure 62: Cell phone clusters, by race and Hispanic origin, November 2010
- Cluster methodology
Custom Consumer Groups
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- Dads constitute distinct subsegment of younger males
- Smartphone ownership
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- Figure 63: Smartphone ownership and intent to buy, by gender and children in the household, November 2010
- Smartphone platforms
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- Figure 64: Penetration and desirability of smartphone platforms, by gender and children in the household, November 2010
- Usage of smartphone functionalities
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- Figure 65: Usage of smartphone functionalities, by gender and children in the household, November 2010
- Attitudes toward mobile phones
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- Figure 66: Attitudes toward mobile phones, by gender and children in the household, November 2010
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- Figure 67: Other attitudes toward mobile phones, by gender and children in the household, November 2010
- App downloading
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- Figure 68: Attitudes toward mobile phones, by gender and children in the household, November 2010
Appendix—Other Useful Consumer Tables
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- By gender
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- Figure 69: Considerations in the phone purchase decision, by gender, November 2010
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- Figure 70: Attitudes toward video calling, by gender, November 2010
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- Figure 71: Attitudes toward next generation data networks, by gender, November 2010
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- Figure 72: Penetration and desirability of smartphone platforms, by gender, November 2010
- By household income
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- Figure 73: Attitudes toward next generation data networks, by household income, November 2010
Appendix—Trade Associations
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