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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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Second-hand smartphone market booms

The worldwide market for used smartphones is forecast to grow to 332.9 million units, with a market value of $67 billion, in 2023, according to IDC

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International Data Corporation (IDC) expects worldwide shipments of used smartphones, inclusive of both officially refurbished and used smartphones, to reach a total of 206.7 million units in 2019. This represents an increase of 17.6% over the 175.8 million units shipped in 2018. A new IDC forecast projects used smartphone shipments will reach 332.9 million units in 2023 with a compound annual growth rate (CAGR) of 13.6% from 2018 to 2023.

This growth can be attributed to an uptick in demand for used smartphones that offer considerable savings compared with new models. Moreover, OEMs have struggled to produce new models that strike a balance between desirable new features and a price that is seen as reasonable. Looking ahead, IDC expects the deployment of 5G networks and smartphones to impact the used market as smartphone owners begin to trade in their 4G smartphones for the promise of high-performing 5G devices.

Anthony Scarsella, research manager with IDC’s Worldwide Quarterly Mobile Phone Tracker, says: “In contrast to the recent declines in the new smartphone market, as well as the forecast for minimal growth in new shipments over the next few years, the used market for smartphones shows no signs of slowing down across all parts of the globe. Refurbished and used devices continue to provide cost-effective alternatives to both consumers and businesses that are looking to save money when purchasing a smartphone. Moreover, the ability for vendors to push more affordable refurbished devices in markets in which they normally would not have a presence is helping these players grow their brand as well as their ecosystem of apps, services, and accessories.”

Worldwide Used Smartphone Shipments (shipments in millions of units)

Region2018
Shipments
2018 Market
Share
2023
Shipments*
2023 Market
Share*
2018-2023
CAGR*
North America39.022.2%87.226.2%17.4%
Rest of World136.877.8%245.773.8%12.4%
Total175.8100.0%332.9100.0%13.6%

Source: IDC, Worldwide Used Smartphone Forecast, 2019–2023, Dec 2019.

Table Notes: Data is subject to change.
* Forecast projections.

Says Will Stofega, program director, Mobile Phones: “Although drivers such as regulatory compliance and environmental initiatives are still positively impacting the growth in the used market, the importance of cost-saving for new devices will continue to drive growth. Overall, we feel that the ability to use a previously owned device to fund the purchase of either a new or used device will play the most crucial role in the growth of the refurbished phone market. Trade-in combined with the increase in financing plans (EIP) will ultimately be the two main drivers of the refurbished phone market moving forward.”

According to IDC’s taxonomy, a refurbished smartphone is a device that has been used and disposed of at a collection point by its owner. Once the device has been examined and classified as suitable for refurbishment, it is sent off to a facility for reconditioning and is eventually sold via a secondary market channel. A refurbished smartphone is not a “hand me down” or gained as the result of a person-to-person sale or trade.

The IDC report, Worldwide Used Smartphone Forecast, 2019–2023 (Doc #US45726219), provides an overview and five-year forecast of the worldwide refurbished phone market and its expansion and growth by 2023. This study also provides a look at key players and the impact they will have on vendors, carriers, and consumers.

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Customers and ‘super apps’ will shape travel in 2020s

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Customers will take far more control of their travel experience in the 2020s, according to a 2020 Trends report released this week by Travelport, a leading technology company serving the global travel industry.

Through independent research with thousands of global travellers – including 500 in South Africa – hundreds of travel professionals and interviews with leaders of some of the world’s biggest travel brands, Travelport uncovered the major forces that will become the technology enablers of travel over the next decade. These include:

Customers in control

Several trends highlight the finding that customers are moving towards self-service options, with 61% of the travellers surveyed in South Africa preferring to hear about travel disruption via digital communications, such as push notifications on an app, mobile chatbots, or instant messaging apps, rather than speaking with a person on the phone. This is especially important when it comes to young travellers under 25, seen as the future business traveler, and managing their high expectations through technology.

Mobile takeover

With the threat of super app domination, online travel agencies must disrupt or risk being disrupted. Contextual messaging across the journey will help. Super app tech giants like WeChat give their users a one-stop shop to communicate, shop online, book travel, bank, find a date, get food delivery, and pay for anything within a single, unified smartphone app. Travel brands that want to deliver holistic mobile customer experiences need to think about how they engage travellers within these super apps as well as in their own mobile channels.

Retail accelerated

In the next year, research shows, we will see an accelerated rate of change in the way travel is retailed and purchased online. This includes wider and more complex multi-content reach, more enriched and comparable offerings, more focus on relevance than magnitude, and an increase in automation that enables customer self-service.

“How customers engage with their travel experience – for instance by interacting with digital ‘bots’ and expecting offers better personalised to their needs – is changing rapidly,” says Adrian Roodt, country manager for Southern Africa at Travelport. “We in the travel industry need to understand and keep pace with these forces to make sure we’re continuing to make the experience of buying and managing travel continually better, for everyone.”

Read the full 2020 Trends report here: 2020 Trends hub.

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