Smartphone Manufacturers Struggling to Differentiate Themselves
Published on: 24th Apr 2014
By: Ian Mansfield
American consumers are increasingly citing price as the key issue when choosing between smartphones as they struggle to comprehend the technical differences between the handsets.
"Over the past three years, wireless OEMs have focused on advanced technology and features to edge out the competition, however, with such similar technology across carriers and devices offered, price is becoming a key component in the selection process," said Kirk Parsons, senior director of telecommunications services at J.D. Power.
The report found that more than one-fifth (21%) of smartphone owners cite "price" as the main reason they chose their particular device, an increase from 13 percent in 2011.
While smartphone owners continue to cite "features" as the primary reason for selecting their device (35%), the rate has declined significantly from 2011, when 57% of consumers cited them.
Reasons for purchase have an impact on customer satisfaction and future loyalty. Selecting a smartphone device based on price generates significantly lower levels of satisfaction (808 on a 1,000-point scale) and repurchase rates (18%) than selections based on product-specific reasons such as operating system (860 and 35%, respectively).
In 2014, the average purchase price for smartphone devices has increased and owners are less likely to receive a discount. On average, smartphone owners indicate that their device cost $202 in the 2014 Vol. 1 study, an increase from $174 in the 2011 Vol. 2 study. More than half (52%) of owners have received a discount on their smartphone in 2014 Vol. 1, compared with 60 percent in the 2011 Vol. 2 study.
When asked which features they would like on their next device, smartphone owners most often cite seamless voice control (36%); built-in sensors that can gauge temperature, lighting, noise and moods to customize settings to the environment (35%); and facial recognition and biometric security (28%).
Overall satisfaction with smartphone devices is highest among AT&T customers (844), followed by Sprint (839); T-Mobile (835); and Verizon Wireless (829) customers. Overall satisfaction among smartphone owners is 837.
|Overall Customer Satisfaction Index Scores||J.D. Power Power Circle Ratings|
|(Based on a 1,000-point scale)||For Consumers|
|Verizon Wireless Average||829||3|
Power Circle Ratings Legend
5 - Among the best
4 - Better than most
3 - About average
2 - The rest