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What fuels smartphone usage?

Last year was a turning point in the mobile industry in South Africa as the smartphone emerged as the most popular communication device for consumers, leaving the feature phone behind, according to the Deloitte Global Mobile Consumer Survey 2017.

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South Africans are now among the top users of smartphones globally and are using them for applications (apps), such as instant messaging, social media and to communicate in methods other than traditional voice calls.

Statistics indicate that smartphones are being used for multi-tasking and multi-screening, and we’ve quickly reached the point where some of us are starting to question if our love for these devices has turned into an addiction.

While we investigate the ubiquity of mobile phones, we should also be aware of the fact that in many instances they have become a must-have business tool. Manufacturers, such as LG, are constantly researching and developing mobile phones to adapt to consumer needs because there is a deep understanding that while some might question whether we’re spending too much time on mobile phones, there are many others who simply cannot do without them.

Consumers and data

The Internet of Things (IoT) revolution is starting to gain momentum in South Africa and as networks increase their data capacity, we will start to see an increased appetite for smartphone apps. As machine learning becomes more common-place, we expect that smartphones will be central to how consumers interact with smart appliances.

The Deloitte survey revealed that a significant majority of consumers (73%) use Wi-Fi at home, work, or at a place of study, compared to 45% for mobile networks. The usage of Wi-Fi in public areas (35% of consumers) and while commuting (14% of consumers) is significantly lower.

Data-hungry consumers perceive Wi-Fi as a competitive alternative to mobile data networks with regards to speed and given the difference in pricing, consumers are likely to use Wi-Fi for data-intensive apps such as streaming and on-demand video.

South African consumers’ preference for access through Wi-Fi aligns with global trends as a Cisco forecast indicates that Wi-Fi will carry 49% of global IP traffic by 2021 and mobile, only 17%.

The need for more data has also resulted in the need for increased on-board memory capacity and memory cards. LG has always been a leader in supplying impressive built-in storage capacity on their mobile phones. The LG G7 ThinQ, for example, has 4/6GB of RAM, 64/128GB of on-board storage space and microSD expansion up to 512GB.

Smartphone usage

Smartphones have become integrated into every facet of our lives, prompting the development of faster data networks, more intuitive handsets and smarter apps. South African mobile phone users prefer to communicate via instant messaging (82%) and social networks (74%) than through text messaging and voice calls.

The popularity of Over-The-Top apps will continue to force a shift in operator revenues from traditional voice and SMSes to data revenues. Email apps also continue to be a popular medium for personal and business communication.

Mobile consumers are also using their smartphones for more video calling and Cisco predicts that global IP video traffic will account for 82% of all consumer internet traffic by 2021.

If we look at usage according to age groups, 25-45 year-olds prefer to spend more time on short videos and news stories while 16-24 year-olds are more likely to spend their time streaming music and TV series, and are least likely to read the news.

While Google and Facebook are still the dominant platforms for short video content, platforms developed by telecoms companies, such as Kwese by Econet and Black by Cell C, are beginning to gain traction by focusing on sport, local productions and user-generated content.

In terms of app usage, the most popular use for 16-24 year-olds is to play music while consumers aged 25-34 and 35-45 mostly use navigation, and traffic update apps.

Given the overwhelming reliance on apps and the speed at which they work, LG ensures mobile phone processors are up to the task of handling multiple apps at the same time. The LG G7 ThinQ has an Octa-core Qualcomm Snapdragon 845 processor to keep up with the most prolific of multi-taskers who have several apps open at the same time.

 

Integral part of our lives

More than one-third of consumers worldwide said they check their phone within five minutes of waking up in the morning and 20% of them check their phone more than 50 times a day.

While there’s no doubt that mobile phones have become an integral part of our lives, individuals and families are concerned about how to manage usage as 47% of respondents believe their partners use their phones too much, and 27% of parents believe their children use their phones excessively. 69% of consumers use their phones while watching TV, 41% indicated they use their phones while talking to friends and family, and 15% admitted to using their phones while driving.

The rise of smartphones continues unabated and South Africa now finds itself among the leading global adopters. The Netherlands, Norway, Ireland and Luxembourg are on the short list of countries which have surpassed the 90% threshold, and South Africa has joined them as 93% of the population has ready access to smartphones.

As smartphone penetration reaches never-before-seen levels, manufacturers such as LG will continue to develop innovative features and products to guarantee that smartphones evolve as quickly as consumers, and that users are always at the heart of technological advancements.

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Online retail gets real

After decades of experience in selling online, retailers still seek out the secret of reaching the digital consumer, writes ARTHUR GOLDSTUCK.

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It’s been 23 years since the first pizza and the first bunch of flowers was sold online. One would think, after all this time, that retailers would know exactly what works, and exactly how the digital consumer thinks.

Yet, in shopping-mad South Africa, only 4% of adults regularly shop online. One could blame high data costs, low levels of tech-savviness, or lack of trust. However, that doesn’t explain why a population where more than a quarter of people have a debit or credit card and almost 40% of people use the Internet is staying away.

The new Online Retail in South Africa 2019 study, conducted by World Wide Worx with the support of Visa and Platinum Seed, reveals that growth is in fact healthy, but is still coming off a low base. This year, the total sale of retail products online is expected to pass the R14-billion mark, making up 1.4% of total retail.

This figure represents 25% growth over 2017, and comes after the same rate of growth was seen in 2017. At this rate, it is clear that online retail is going mainstream, driven by aggressive marketing, and new shopping channels like mobile shopping. 

But it is equally clear that not all retailers are getting it right. According to the study, the unwillingness of business to reinvest revenue in developing their online presence is one of the main barriers to long-term success. Only one in five companies surveyed invested more than 20% of their online turnover back into their online store. Over half invested less than 10% back.

On the surface, the industry looks healthy, as a surprisingly high 71% of online retailers surveyed say they are profitable. But this brings to mind the early days of Amazon.com, in 1996, when founder Jeff Bezos was asked when it would become profitable.

He declared that it would not be profitable for at least another five years. And if it did, he said, it would be in big trouble. He meant that it was so important for long-term sustainability that Amazon reinvest all its revenues in customer systems, that it could not afford to look for short-term profits.

According to the South African study, the single most critical factor in the success of online retail activities is customer service. A vast majority, 98% of respondents, regarded it as important. This positions customer service as the very heart of online retail. For Amazon, investment back into systems that would streamline customer service became the key to the world’s digital wallets.

In South Africa online still make up a small proportion of overall retail, but for the first time we see the promise of a broader range of businesses in terms of category, size, turnover and employee numbers. This is a sign that our local market is beginning to mature. 

Clothing and apparel is the fastest growing sector, but is also the sector with the highest turnover of businesses. It illustrates the dangers of a low barrier to entry: the survival rate of online stores in this sector is probably directly opposite to the ease of setting up an online apparel store.

A fast-growing category that was fairly low on the agenda in the past, alcohol, tobacco and vaping, has benefited from the increased online supply of vapes, juices and accessories. It also suggests that smoking bans, and the change in the legal status of marijuana during the survey, may have boosted demand. 

In the coming weeks, we can expect online retail to fall under the spotlight as never before. Black Friday, a shopping tradition imported “wholesale” from the United States, is expected to become the biggest online shopping day of the year in South Africa, as it is in the USA.

Initially, it was just a gimmick in South Africa, attempting to cash in on what was a purely American tradition of insane sales on the Friday after Thanksgiving Day, which occurs on the third Thursday of November every year. It is followed by Cyber Monday, making the entire weekend one of major promotions and great bargains.

It has grown every year in South Africa since its first introduction about six years ago, and last year it broke into the mainstream, with numerous high profile retailers embracing it, and many consumers experiencing it for the first time. 

It is now positioned as the prime bargain day of the year for consumers, and many wait in anticipation for it, as they do in the USA. Along with Cyber Monday, it provides an excuse for retailers to go all out in their marketing, and for consumers to storm the display shelves or web pages. South African shoppers, clearly, are easily enticed by bargains.

Word of mouth around Black Friday has also grown massively in the past two years, driven by both media and shoppers who have found ridiculous bargains. As news spreads that the most ridiculous of the bargains are to be had online, even those who were reticent of digital shopping will be tempted to convert.

The Online Retail in SA 2019 report has shown over the years that, as people become more experienced in using the Internet, their propensity to shop online increases. This is part of the World Wide Worx model known as the Digital Participation Curve. The key missing factor in the Curve is that most retailers do not know how to convert that propensity into actual online shopping behaviour. Black Friday will be one of the keys to conversion.

Carry on reading to find out about the online retailers of the year.

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Reliable satellite Internet?

MzansiSat, a satellite-Internet business, aims to beam Internet connections to places in South Africa which don’t have access to cabled and mobile network infrastructure, writes BRYAN TURNER.

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Stellenbosch-based MzansiSat promises to provide cheap wholesale Internet to Internet Service Providers for as little as R25 per Gigabyte. Providers who offer more expensive Internet services could benefit greatly from partnering with MzansiSat, says the company. 

“Using MzansiSat, we hope that we can carry over cost-savings benefits to the consumer,” says Victor Stephanopoli, MzansiSat chief operating officer.

The company, which has been spun off from StellSat, has been looking to increase its investor portfolio while it waits for spectrum approval. The additional investment will allow MzansiSat’s satellite to operate in more regions across Africa.

The MzansiSat satellite is being built by Thales Alenia Space, a French company which is also acting as technical partner to MzansiSat. In addition to building the satellite, Thales Alenia Space will also be assisting MzansiSat in coordinating the launch. The company intends to launch the satellite into the 56°E orbital slot in a geostationary orbit, which enables communication almost anywhere in Africa. The launch is expected to happen in 2022. 

The satellite will have 76 transponders, 48 of which will be Ku-band and 28 C-band. Ku-band is all about high-speed performance, while C-band deals with weather-resistance. The design intention is for customers of MzansiSat to choose between very cheap, reliable data and very fast, power-efficient data. 

C-band is an older technology, which makes bandwidth cheaper and almost never affected by rain but requires bigger dishes and slower bandwidth compared to Ku-band connections. On the other hand, Ku-band is faster, experiences less microwave interference, and requires less power to run – but is less reliable with bad weather conditions.

MzansiSat’s potential military applications are significant, due to the nature of the military being mobile and possibly in remote areas without connectivity.  Connectivity everywhere would be potentially be life-saving.

Consumers in remote areas will benefit, even though satellite is higher in latency than fibre and LTE connections. While this level of latency is high (a fifth of a second in theory), satellite connections are still adequate for browsing the Internet and watching online content. 

The Internet of Things (IoT) may see the benefits of satellite Internet before consumers do. The applications of IoT in agriculture are vast, from hydration sensors to soil nutrient testers, and can be realised with an Internet connection which is available in a remote area.

Stephanopoli says that e-learning in remote areas can also benefit from MzansiSat’s presence, as many school resources are becoming readily available online. 

“Through our network, the learning experience can be beamed into classrooms across the country to substitute or complement local resources within the South African schooling system.”

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