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Published by: Mintel International Group Ltd.
Published: May. 1, 2006 - 121 Pages
Table of Contents
- INTRODUCTION AND ABBREVIATIONS
- Definitions
- Telecommunications equipment types
- Some technology definitions
- Financial definitions
- Research methodology
- Consumer research
- ACORN
- ABBREVIATIONS
- EXECUTIVE SUMMARY
- Vibrant but complex market conditions
- Mobile market dipped then revived
- Fashion is king
- Churn between networks
- Retailers scramble to exp Why the retail chains are expanding
- Product lifecycles shorten to drive dem New challenges as style takes prime position
- Just how does a retailer differentiate?
- Specialists dominate market share
- Figure 1: Distribution of mobile phone handsets, by volume, 2005
- Implications of the expansion of the supermarkets
- Merger and acquisition among retailers
- Importance of the Internet
- Five main kinds of consumer
- Figure 2: Consumer typologies, 2006
- A deal-driven market
- Evidence of a shift to contract sales?
- The mobile generation
- The future
- INDUSTRY ISSUES AND INSIGHTS
- Buoyant dem Handset fashion creates desire
- Network strategies
- Subsidies influence the market dynamics
- Retailing is very competitive
- Loyalty is fairly low
- Two main market segments
- Seasonal strategies
- Contracts more lucrative
- Selling contracts requires more man power
- How the retailers vary
- Scramble for more sites
- Tough competition means pressure on independents
- Staff training
- Store design
- New format development
- Internet selling
- Will distribution of mobile phones broaden?
- Grey markets
- Blurring technologies
- Voice over Internet
- What do consumers want?
- New developments could reshape the market
- Buoyant demand, but tough competition
- Retailers will have to work harder and smarter
- RETAIL SALES
- Slower growth in 2005
- Figure 3: All retail sales, at current and constant 2000 prices, 2000-06
- Price deflation has characterised electricals
- Figure 4: Sales through electrical retailers, at current and constant 2000 prices, 2000-06
- SECTOR STRUCTURE
- The networks
- Fixed line service providers
- Figure 5: Fixed line service providers, all revenue and share, 2003, 2004 and Q1 2005
- Independent specialists
- General retailers
- CONSUMER EXPENDITURE
- The mobile phone market
- Figure 6: Mobile phone subscribers, 2000-06
- Expenditure on mobile phones
- Figure 7: UK retail sales of mobile phone handsets, by volume and value, 2000-06
- Segmentation of the mobile phone market
- Figure 8: Mobile phones sold, by pre-pay or contract, 2003-05
- Fixed line telephones and answering machines
- Figure 9: Fixed line telephones and answering machines, 2003-06
- Segmentation of fixed line equipment
- Figure 10: UK retail sales of telephones and answering machines, by volume and value, 2003-05
- MARKET FACTORS
- The economy
- Figure 11: GDP at current and constant 2001 prices, 2001-05 and forecasts for 2006 and 2011
- Growth of personal disposable income
- Figure 12: PDI and consumer expenditure, at current and constant 2001 prices, 2001-11
- Population trends
- Figure 13: UK population, by age group, 2001, 2006 and 2011
- Socio-economic trends
- Figure 14: UK population, by socio-economic group, 2001, 2006 and 2011
- Changing working patterns and lifestyles
- Security and theft
- Health fears
- Technological developments
- Voice over Internet promises free talk time
- Further technological developments - 4G
- Content provision
- THE CONSUMER
- Key consumer findings
- Fixed-line telephones
- Figure 15: Types of telephone owned, 2000-05
- Mobile phones
- Figure 16: Trends in ownership of mobile phones, 2000-05
- Multiple ownership of mobile phones
- Figure 17: People in the household owning a mobile phone, 2000-05
- Type of mobile phone contract
- Figure 18: Type of mobile phone contract used, 2002-05
- How long with current mobile network
- Figure 19: How long with current network, 2001-05
- High ownership of mobiles among young children
- Figure 20: Youth, ownership of mobile phones, who pays and type of contract, 2005
- Source of last mobile phone purchased
- Figure 21: Outlet where last mobile phone purchased, January 2006
- Figure 22: Outlet where last mobile phone purchased - Specialists, by gender, age and socio-economic group, January 2006
- Figure 23: Outlet where last mobile phone purchased - Other specialists, non-specialist and non buyers, by gender, age and socio-economic group, January 2006
- Channel used for last mobile phone purchased
- Figure 24: Channel used for last mobile phone purchase, January 2006
- Figure 25: Channel used for last mobile phone purchase, by gender, age and socio-economic group January 2006
- Figure 26: Channel used for last mobile phone purchase, by outlet used for last purchase, January 2006
- THE CONSUMER - DETAILED CONSUMER DEMOGRAPHICS
- Figure 27: Outlet where last mobile phone purchased - Specialists, by presence of children, lifestage Mintel’s Special Groups, January 2006
- Figure 28: Outlet where last mobile phone purchased - Other specialists, non-specialist and non buyers, by presence of children, lifestage and Mintel’s Special Groups, January 2006
- Figure 29: Outlet where last mobile phone purchased - Specialists, by region and ACORN category January 2006
- Figure 30: Outlet where last mobile phone purchased - Other specialists, non-specialist and non buyers, by region and ACORN category, January 2006
- Figure 31: Outlet where last mobile phone purchased - Specialists, by media usage, commercial TV viewing and source of regular grocery shopping, January 2006
- Figure 32: Outlet where last mobile phone purchased - Other specialists, non-specialist and non buyers, by media usage, commercial TV viewing and source of regular grocery shopping, January 2006
- Figure 33: Channel used for last mobile phone purchase, by presence of children, lifestage and Mintel’s Special Groups, January 2006
- Figure 34: Channel used for last mobile phone purchase, by region and ACORN category, January 2006
- Figure 35: Channel used for last mobile phone purchase, by media usage, commercial TV viewing and source of regular grocery shopping, January 2006
- RETAIL MARKET SHARES
- Fixed line equipment
- Figure 36: Distribution of fixed line telecommunications equipment (phones, fax, answering machines), 2003-05
- Mobile handsets
- Figure 37: Distribution of mobile handsets, 2000-05
- RETAILER PROFILES
- SPECIALISTS
- Figure 38: Summary of spcialist mobile phone retailers, 2005
- The Carphone Warehouse plc
- Figure 39: The Carphone Warhouse, UK and Irish outlet numbers, 2002-06
- Figure 40: The Carphone Warehouse plc, group financial performance, 2001-05
- Figure 41: The Carphone Warehouse plc, UK financial performance, 2001-05
- Figure 42: The Carphone Warehouse, segmental analysis, 2005
- The Link
- Figure 43: The Link, store numbers, 2001-05
- Figure 44: The Link, financial performance, 2001-05
- Vodafone
- Figure 45: Vodafone, UK store numbers, 2001-05
- Figure 46: Vodafone Distribution Ltd, (including UK retail), financial performance, 2001-05
- Phones4U
- Figure 47: Phones4U, store numbers, 2001-05
- Figure 48: Phones4U, financial performance, 2001-05
- Orange
- Figure 49: Orange UK, store numbers, 2001-05
- Figure 50: Orange retail, financial performance, 2000-04
- O2
- Figure 51: O2, store numbers, 2002-05
- T-Mobile
- Figure 52: T-Mobile, UK store numbers, 2001-05
- Virgin Mobile 3 (Hutchison Mobile)
- Other mobile phone specialists
- ELECTRICAL RETAILERS
- Currys
- Figure 53: Currys, store numbers, 2001-05
- Dixons (Currysdigital)
- Comet
- Figure 54: Comet, store numbers, 2001-05
- NON-SPECIALISTS
- John Lewis
- Argos
- Tesco
- Sainsbury’s
- Asda
- Marks & Spencer
- Woolworths
- Jessops
- Amazon
- Boots
- THE FUTURE
- Fixed line market about to change
- Demand for mobiles will be strong
- Replacement handsets will drive the market
- Challenge to build loyalty
- Store chains will continue to grow
- Internet will also grow
- More investment in concept stores for larger cities
- Specialists will benefit from 3G growth
- Pay-as-you-go is not dead
- Non-network stores will continue to develop services
- Conclusions
- FORECAST
- Strong demand for mobiles predicted
- Figure 55: Forecast of the telecommunications market, 2006-11
- NPD to drive both sectors
- Blurring the boundaries: Compatibility and Integration
- Figure 56: Forecast sales of telecommunications equipment, at current prices, 2006-11
- Factors incorporated in the forecast
- APPENDIX: RESEARCH METHODOLOGY
AbstractTelecommunications retailing has developed very rapidly in the last five years, largely because the market for mobile phones has expanded at a breathtaking pace. Over the same period the market for fixed line equipment has been less buoyant, although the emergence of digital cordless phones with good styling and extra features has helped to grow sales. Some mobile phone retailers also sell fixed line equipment, but the main thrust of their business is in mobile phones.
All the major mobile phone networks have expanded rapidly to become national retail chains with stores in all the major shopping centres. Yet despite their considerable scale they are all intent on further expansion, in what has become known as a land grab. This report looks at:
- the factors behind their expansion and why these retail chains are expanding, even though the market is entering a mature phase
- the way these chains have evolved and the new ideas being injected into the latest retail formats
- the growth strategies of the major independent chains
Mobile phones are also important to general retailers, although these have grown by selling pay-as-you-go handsets. The report looks at how and if these retailers will tackle the growing market for selling mobile phones with contracts for monthly payment.
Online shopping was originally a good hunting ground for the discounters, but is now developing into an important alternative shopping channel for all the major networks and retailers. This report examines the future for this medium in the market for telecoms retailing and asks if there is a ceiling to growth in Internet trading.
The nature of the selling process for mobile phones has changed as the market has matured and penetration of handsets has risen. So retailers need to persuade consumers to buy more often and trade up to higher priced handsets, as well as developing more lucrative long-term relationships. There are new challenges posed by these changing market conditions, influencing strategies for selling and advice. The report considers the role of handsets vs the deal within the marketing mix and asks if there is such as thing as loyalty in mobile phone retailing.
There is more change to come, driven by the advances in technology. Mobile phone handsets will be able to tackle more tasks more effectively and the new advances will open up a whole range of new services that can be accessed via mobile devices. The possibilities opening up for cheaper or free voice calls over broadband mean that there are new challenges to fixed line equipment and changes that will embrace all kinds of telephone use. So how should the mobile phone retailers adapt as the technologies develop?
This is a dynamic and interesting market with huge opportunities for growth in the future. The report examines future prospects and identifies the key factors that will influence retailing of mobile phones in the next few years.
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