The Three Types of Mobile Phone Customer
The mobile phone industry has become segmented into 3 distinct customer types, contract mobile phone customers, pay as you go customers, and most recently sim only contract phone users.
The 1st group are the foundation for mobile companies, contract mobile phone subscribers. Until the last year or two, mobile phones were usually sold on annual contracts, with the benefit for customers being that they got a handset included upon taking out a contract. Popular since the mid 90s, the annual contract is still a very popular choice today, although 18 month and two year contract options are growing in popularity all the time. The reasons for this are primarily twofold, firstly handsets seem to last longer these days, particularly in terms of battery life time. It used to be commonplace that by the end of your annual contract, your phone might not even hold its charge for a full day, or in some cases you might have needed to buy a new battery before your contract completed! The second reason for the growth of the eighteen month and 24 month contracts is the incentives. By agreeing to a longer term contract, you can expect to receive a free laptop or games console on some deals, in addition to your bundled minutes and text allowance. Even if you don’t go for a free gift option, you will normally find the minutes and texts bundled with your handset are much more generous compared to the monthly price of a shorter annual version.
The second user group is the other end of the spectrum – no minimum term contract and minutes and messages are paid for as required, usually in denominations of five pounds, £10 or twenty pounds. The obvious target user for this model is the under 18 market – unable to apply for credit and therefore unable to benefit from the contract pay monthly mobile phones unless an adult signs up on their behalf. Interestingly, adults make up for the lions share of the pay as you go market – demonstrating the appeal of the prepay offering against the cheaper talk and text contract.
Finally, the most recent arrival to the marketplace is the sim-only contract – a contract which typically lasts only 30 days, and then renews monthly. It is mainly targetted at the section of the market with existing phones that don’t mind about getting a new mobile phone, instead looking for the best value service. This marks a clear shift in the marketplace to great value in service provision, whereas a lot of marketing spend has previously been aimed at the latest mobiles and the most advanced funcationality.
Check out the latest sim only deals on the market.