4G is Major Selling Point for Acquiring New Mobile Customers

Last week as part of the continuing look at the series of reports associated with the recently published Nokia 2016 Acquisition and Retention Study, we took a deeper dive into one of the granular parts of the series, Drivers of Customer Retention.   As promised this week we look at another part of the series which is now available for download, Trends in New Sign-ups.  This is obviously a very important topic for mobile service providers as churn remains a significant industry challenge, and thus obtaining new customers is truly “mission critical.”

The focus in this report is on the opportunities and challenges of new sign-ups as it relates to the rollout and attraction/importance of 4G.  The big trend in the research is in the chart below and is why service providers need to concentrate on making the entire 4G customer experience/journey compelling.

What the researchers have to say about this is interesting.  After explaining why 4G is a win-win for operators and customers, they note that: “Currently, device compatibility and lack of 4G awareness are holding back wider adoption of 4G services.  To address this, operators should help consumers understand if their devices are 4G compatible and promote the range of low-cost 4G devices currently available.”  The report goes on to observe that awareness is an issue as there are still large numbers of subscribers in mature and developing markets that do not believe they need 4G and/or have little or no understanding of the difference between 3G (which remains widely deployed as networks transition) and 4G.

In fact, the numbers behind this are useful.  The top four reasons customers do not use 4G, and thus don’t see it as a reason to switch or select a service provider are:

• “My device does not support 4G” (32 percent)
• “4G is too expensive” (24 percent)
• “I don’t need 4G” (22 percent)
• “Don’t know the difference” (15 percent)

The differences in each of these categories, in terms of Mature versus Transition markets, were found to be negligible.

An additional chart of interest, which is another reason to download the full report, deals with 4G sign-ups in Mature and Transition markets of post-paid v. pre-paid.  Not surprisingly post-paid is the dominant source of new 4G sign-ups as it has been historically in most of the world.  Yet, as the chart indicates, in Transition markets prepaid is making headway and that is good news for operators looking for more consistency and predictability of their subscriber bases. 

The lessons here are rather important.  The need for speed on mobile networks is a global trend and a real attraction to potential subscribers whether brand new or switching.  It is why literally no matter where you roam the marketing blitzes that highlight 4G coverage, along with network speed and business models that accommodate multiple users and inexpensive data plans, are so intense.  4G coverage and speed are huge customer acquisition attractions, and mobile service providers seeking to leverage this have opportunities if they get their marketing messaging right.