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Consumers Say "Yes!" To 3g
Posted: 07-Jul-2002 [Source: Detica press release]

[Detica releases new research report showing 70% of respondents saying they are likely to use 3G services when they become generally available.]

Contrary to negative speculation on the uptake of 3G wireless technology, consumers have given a (qualified) thumbs-up to the services which will be on offer. New research undertaken by Detica, one of the largest CRM consultancies in the UK and advisor to some of Europe's major 3G licence holders, shows that it is not a question of if consumers will use 3G services, but when - and it's going to be a lot sooner than many companies think.

The Detica research report, Consumer Attitudes to Next Generation Wireless Technologies, reveals the results of a detailed 200,000 qualitative and quantitative research project undertaken with consumers over the course of 12 months. This included use of mock-up applications for the financial services, entertainment and travel sectors, using demonstration 3G devices. Over 77% of those surveyed found the individual services either "appealing" or "highly appealing" (for entertainment, this was a massive 88%) and over 70% claim that they are likely to use similar services when they become generally available.

Worryingly for businesses which are still holding off from 3G application development, however, the research shows consumers appear willing to ditch existing relationships, if their preferred brands do not offer 3G services. In the case of Financial Services, 82% of those polled said they expected these services to be offered by their bank.

On the implications of this finding, Jeremy Braune, Head of Research for Detica is clear: "After companies were burned by the failure of WAP to achieve widespread adoption, many are playing a waiting game to watch what happens to those who go first with 3G. The research shows that customers are excited about these services, they want businesses to provide them and many are prepared to defect elsewhere if they don't get them. With a six to 12 month development time, companies that wait until demand rises could find themselves a long way behind the game and, worse, risk losing significant percentages of their core customer base. Major financial services and entertainment providers, for instance, need to be evaluating 3G now: don't wait!"

Companies engaging in 3G should also be aiming to avoid what Detica terms "The WAP Trap", which occurred due to unreconciled issues surrounding speed of delivery, poor interfaces and limitations in content. As Braune notes, 3G is a great opportunity for companies to learn from the problems encountered from WAP, if their development processes are undertaken thoroughly and methodically: "If companies prepare well and invest in appropriate technology for their customers, then we should see more rapid adoption rates and users who become more confident and savvy, more quickly. Our research shows that only around 28% of users are prepared to spend more than 10 minutes learning to use 3G technologies, so companies need to prepare well and get it right first time."

Detica's research identified potential negatives which could affect demand for 3G, which it has broken into two specific groups for companies to address:

Firstly, barriers to 3G adoption concerning 3G devices themselves. These cover user worries about cost, battery capacity, handset fragility, speed, security (a major concern) and the user interface. Braune comments: "These issues are essentially about the basics of 3G and it's crucial that they are addressed before anyone tries to think about what services sit on top of them. Get these things right first and some of the problems we saw arising during the WAP launch should be avoided."

Secondly, potential barriers to adoption concerning 3G services. For example, consumers were concerned that, when initiating purchases (e.g. buying cinema tickets) or specific services (e.g. paying bills) via the device, they could not feel sure that their instructions had been received or actioned appropriately.

Braune regards such concerns as inevitable, and addressable. He concludes "Potential barriers to adoption tend to be highly segment-specific. The key to maximising acquisition and retention will be to adopt a similarly segment-specific approach to the development of individual services and the sales, marketing and support infrastructures that underpin them. Our research indicates strongly that a 'one size fits all' approach will not be capable of maximising market potential."

Within the project, five stages of qualitative and quantitative research were conducted and over 2,500 respondents interviewed. Respondents were aged 18-45, BC1, reflecting a range of attitude and aptitude relating to the use of wireless communications technology.

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