Size does matter. Small though they may seem, mobile phone accessories and applications have become an important part of the entire mobile phones ecosystem. Brands across the spectrum are offering some of the trendiest accessories and Apps to lure the end consumer, especially the on-the-go youth. Travel chargers, headsets, Bluetooth speakers and to that extent even mundane USB cables have moved beyond the standard colour black to a more vibrant fluorescent hue. In addition, fulfilling the entertainment needs of the consumer, applications like Angry Birds, Foursquare and Instagram, among hundred others, have gained immense popularity. But how long will this bubble last or will change the game for marketers in this industry? Pitch tries to explore.
A mobile phone is no longer defined as an instrument used to call or text, it is no more a tool that provides a camera on the go and an enterprise service to be abreast with work. It is an instrument that today marks the lifestyle of the user, which is defined by what it can do rather than what it is. Adding more vibrancy in the consumers life are the new-age funky mobile accessories and Apps especially with the emerging Smartphone market.
Even though the Smartphones made up 5.3 per cent of units sold in the first quarter, the industry has added almost a quarter of total handset revenues in India, according to a CMR report of March 2012. Applications and accessories are no longer sold as complementary items. With the new colourful new Nokia Accessories for the Lumia and other Nokia phones and Blackberry’s latest apps like ghost camera, photo port, photo studio pro among others, gives way to the question that, are applications and accessories the USP of the instrument? Do they drive sales? Or are they just essentials and add-ons? Experts have a mixed outlook.
Faizal Kawoosa, Senior Manager, Research and Consulting, Cyber Media Research believes that after the introduction of the iPhone, everybody got exposed to app-stores. “Earlier we had Nokia OVI but that did not take off as expected, the network was not sturdy and we did not have that many options,” he appends. According to him with the iPhone people understood the benefits of app stores and what apps could do. People could differentiate and personalise their handsets through these apps. Kawoosa adds, “A mobile at the end of the day has some basic and generic functions, but everybody likes to personalise it, therefore, this is a trend that is going to further enhance and intensify the sales.”
Agreeing to that Bharat Nagpal, technology consultant at iGyaan feels that the consumer is not looking at a smartphone as a main purchase, as he wants the experience also. Since applications allow experiences like gaming on the go, office work on the go, it adds to the features. A consumer therefore, looks for a phone that allows maximum expandability and the maximum applications.
Nagpal adds that apps are also becoming dynamic and are tying up with accessories; apart from the colourful accessories just being an add-on. Accessories have become a part of the Smartphone where it interacts with the applications. For example the heartbeat monitor or Nike+, that records the users sporting activities. “These things become a value buy, where you can do a lot of things which in turn has become a major driver of sales these days.”
Rizwan Memon, Community and Products Manager, Techtree.com, disagrees on this fact and says that each phone has a specific accessory tied to that phone. “They are more like an addition to the main product as a complementary item. It is an added benefit that the company is giving to the users who want something different for their phones.”
A recent CMR report states that the recently announced reduction in tariffs of 3G services by as much as 70 per cent by leading India telecom service providers, the market for both 3G-enabled devices and mobile broadband-driven content is likely to see an upward trend in adoption in the forthcoming quarters. Is this the reason behind the boom of applications and the usage of accessories?
Kawoosa says that, the vendors have realised that accessories are also a good market. If a Smartphone is available for Rs 10-15,000 and a Bluetooth handset would compliment it, which is worth Rs 1,500-2,000 then it is a good market for the accessory. “At the end of the day the target is increase the revenue per customer. The other thing he says is that the people have started using accessories, which earlier days hardly would happen. From a plain mobile phone image high end sophisticated accessories have enhanced the image of the phone and not just the basic headsets. “I would not call it a major driving force behind mobile purchase today per se. it is just an add-on, to enhance and provide end to end consumer experience,” adds Kawoosa.
Applications portray a different picture, they are versatile and are handy.“People do go in for phones that give more apps. The most popular platforms are android and iOS which have a strong application list. People buy android phones because they have a lot of games and a lot of applications that let them plan their day or play games when they are bored, the application store does make a difference in the buying decision of a Smartphone,” adds Techtree’s Memon.
A CMR report quotes that the needs of users are clearly seen to be converging around two major form factors – high-power, high-speed Smartphone vis-à-vis value-plus, content-enabled feature phones. While most players are strong in a particular category, Samsung and others have been able to maintain a strong presence across the spectrum, driven mainly by innovation, quick time-to-market and a segmented approach, Samsung today owns 40.4 per cent share leading the market in the Smartphone segment followed by Nokia 25.5 per cent and RIM (Bleckberry) 12.3 per cent.
However, not all brands are harping on the accessory offerings. As Nagpal points out that Samsung is not a driver of accessories, but only brings out essentials. So why are these elements becoming so crucial from the marketing point of view of competitors like Nokia and Blackberry? Nagpal explains that Nokia has lost out on the market share as they did not join the android brand wagon, for them to launch new accessories is a value add for them, as they are trying to create an ecosystem especially for the Lumia series; where with a bright blue phone one can get a bright blue bluetooth headset.
According to Nagpal, Blackberry is now suffering because of android and iOS taking a toll on it. The next major thing that Blackberry is doing is coming out with Blackberry 10, that will share the same ecosystem as android, where apps play a major role. On the same lines, Memon says that Samsung does not have a lot of accessories, it outsources accessories. It is more focused on making phones. Other brands feel that the customers should get that added accessory to enhance their experience. Brand equity is not defined by the accessories of the phone, but the built quality and the features.