Indian Mobile Consumer Survey:

Mobile phone replacement cycles are shortening with the advent of 4G networks, Jio the most preferred operator while Flipkart tops as a preferred online channel.

San Diego, Buenos Aires, London, New Delhi, Hong Kong, Beijing, SeoulApril 11th, 2017

Counterpoint Research announces key findings from its latest in-depth global consumer insights service spanning multiple countries. India, one of the key markets where the study is being conducted, helps every player in the mobile value chain to gain insights - from user behaviors, brand preference, factors influencing purchase decisions to mobile usage patterns. Some key findings from the India market survey are as follows:

Mobile phone replacement cycles are shortening:

• As per the survey, two in three users plan to upgrade to a new mobile phone in the next twelve months. This is a departure from an average of 24-30 months to under 20 months upgrade cycle.
• The acceleration in intent to upgrade sooner to a new mobile phone is being driven by multiple factors:
  • Firstly, our survey showed many users are looking to upgrade to a phone with 4G LTE capability and especially VoLTE ready. This is mainly driven by Reliance Jio’s VoLTE-only network and consumers’ high intention to switch providers to Jio.
  • Secondly, many users are looking for a phone with better memory, storage or battery capacity, driving an urgent desire to upgrade as smartphones become central to their lives.
• Among other interesting finds from the survey – almost one in three respondents were considering phones with a fingerprint sensor and better front facing ‘selfie’ cameras as key features in their next purchase.

Online is becoming the preferred channel for mobile phone purchases:

• Respondents highlighted that online reviews of a product are the most important source of information for their pre-purchase research.
• Seven out of ten respondents consider online stores as their preferred point of purchase. Furthermore, Flipkart is the most preferred online retail platform for buying a mobile phone.

According to Senior Analyst, Pavel Naiya, “Online retail platform competition is heating up. While Amazon is investing heavily in India, Flipkart has successfully secured $1.4 Billion in funding to secure its place as leading online channel. We expect ultimately there will be three dominant online sales channels. Paytm is currently in a minority position, but the strategic investment by Alibaba suggests it will grow in strength while Snapdeal fades.”

Pavel Naiya adds, “With rising competition, these platforms need to create differential push and pull strategy. Firstly, by adopting an effective social commerce strategy and secondly investing in next generation technologies such as Artificial Intelligence (AI) to utilize the huge data on online purchase patterns.”

Exhibit 1: Preferred eCommerce platform for buying next smartphone

Source: Counterpoint’s Global Consumer Insights

Indian mobile users are Jio-fied:

• Almost half of the respondents surveyed are looking to buy a new SIM or port-out from their existing operator.
• According to the survey, more than half of the respondents are likely to choose Reliance Jio over any other operator for their new connection or porting from the existing one. While one fourth of the respondents are likely to consider Bharti Airtel.

According to Associate Director - Tarun Pathak, “The Jio-fication of modern mobile consumers is happening. Aggressive 4G offerings from free-trials to one of world’s lowest priced 4G data plans bundled with bouquet of applications and content services, Jio has driven the purchase intention strongly in its favor in just six months. Almost one in three respondents have the Jio TV app installed on their device; only next to the default YouTube app which comes pre-installed on an Android device.

Jio has raced to more than 100 Million subscribers and we are seeing an increasing affinity towards Jio’s network as well as services. However, maintaining the quality of service (QoS) of Jio’s network and offerings will be critical for Jio to sustain this momentum and stickiness as it rolls out its paid offerings.”

Exhibit 2: Preferred operator for new connection or porting

Source: Counterpoint’s Global Consumer Insights

Methodology:

This is a primary consumer survey conducted by Counterpoint Technology Market Research through randomly selecting sample of 1500+ respondents of India to understand mobile user behaviors, usage patterns, preferences and factors influencing purchase decisions.

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