Earlier this year we were fortunate to have entrepreneur, blogger and product strategist Mike Mace drop by and host a brown-bag strategy discussion with some frogs. One of the topics we discussed was whether smart phones have changed the way we think about buying phones.
Most frogs and Mike were in agreement that we bought our first iPhones for its shiny look and joy of the beautiful touchscreen. However, there was good debate as to whether that still holds true -- or whether application ecosystems and services lock in second and third generation buyers, making them less likely to switch. Put another way, when you pick Apple/iOS or Google/Android, are you likely to remain a happy prisoner to your ecosystem or are you just as likely to switch when the new shiny device comes along?
To test this, I surveyed my colleagues at frog to assess their feelings about the Nokia Lumia 900 that came out this spring (more on this later) and their stated approach to buying phones. 82 frogs based in our US studios took part in my study. When asked directly about their phone buying philosophies:
When I cross tabulated buying philosophies with expressed interest in a new phone, iOS loyalists were the happiest of prisoners, in that 81% would not even consider another phone. Android fans were fairly loyal (50% would not consider operating system infidelity), and not surprisingly the agnostics were the most open to a new phone. Added up, roughly 1/3 of frogs were open to considering a new phone and new operating system.
So what are the characteristics of the agnostics and unhappy prisoners who are open to a new phone/OS? What are the characteristics of buyers likely to fall for the hot new phone? My hypothesis is that if OS switchers were evenly distributed across all levels of experience with smartphones, the shiny-device theory would hold. If they were clustered around first time buyers only, it would indicate that there is an ecosystem effect.
There was very little correlation between how many generations of smart phone the frog in question was on, and their openness to switching. Those who had never had a smart phone were more likely to be interested, but the sample size of smart-phone virgins at frog was too small (just 3 out of the 82) to read much into it. As for the others, there was no significant difference between those on their second smart phone compared to those on their third, fourth or fifth.
What other indicators might help us here?
Of all the things we tested, app use was the best indicator of willingness to switch. I asked each of the 82 frogs who participated in this study to think back through the last 24 hours and tell me how many apps on their phone they had used. I then grouped them into three buckets:
Cross tabulating interest in the new phone with app use was instructive.
The light app users were significantly more open to getting the new phone than heavy app users. So it isn’t just how long you have been with one platform or another that matters, but how deeply you are into that application ecosystem. As the land-grab for first time smartphone buyers slows down, this has interesting implications for who to target with new phones. Going after all users seems to be a struggle but there may be a better strategy of targeting light app users. My colleague Hiro Ellis pointed out that if app use is related to operating system, I would just have found an effect. I tested this and found that iOS fans and agnostics were somewhat more likely to be heavy app users, but overall there was very little difference in app use by OS philosophy.
One implication of this is that a switch to browser based applications will weaken the current lock-in effect. There is more to this story, but Apple and Google are both backing HTML 5 initiatives. They must be confident that we are happy prisoners who will stay with them even when the prison is unlocked and open, as opposed to unhappy prisoners, who bolt at the first opportunity!
Timothy Morey is an assistant VP for the Innovation Strategy Group (ISG) at frog, and the practice lead for business strategy.