Sunday, 25 July 2021

Consumers are confused by mobile phone finance

By Total Telecom Staff
Thursday 17 June 21

A new study by Cambridge based Trustonic reveals that more than a third of respondents believed they were on a contract for their device and tariff suggesting many are unaware that a contract is in fact a finance agreement. A third said they would have purchased a higher specification device (more expensive) if financing was available…

A new study by Cambridge based Trustonic reveals that more than a third of respondents believed they were on a contract for their device and tariff suggesting many are unaware that a contract is in fact a finance agreement. A third said they would have purchased a higher specification device (more expensive) if financing was available.

The findings were based on research conducted by Censuswide who spoke to 1,000 UK adults (aged 16+) in April 2021.

Dion Price, CEO, Trustonic said “Operators are missing an opportunity. There is clearly appetite amongst consumers to have the highest spec mobile devices and they are willing to take financing deals to obtain them. The fact is, increasingly customers are turning away from traditional mobile contracts as new competitors offer more attractive financing deals”.

When asked whether they would consider spreading the cost of purchasing a mobile phone if this option were offered at the point of purchase, nearly 2 in 5 (37%) of UK consumers said they would.

Ben Woods, Chief Analyst & CMO, CCS Insights commented “The mobile phone industry has been built on financing expensive phones and making the cost more affordable and manageable for consumers. Success depends on having a robust platform to manage the process in a customer friendly way”.

In the UK, the study found that cost was the most cited reason to change operator (35%) – with the trend most prevalent amongst the young, with more than half of 16–24-year-olds switching in the last three years.

Price went on to conclude that “Only when everyone has access to device financing can we start to bridge the digital divide across the UK, and worldwide.”

For more on bridging the digital divide, join Total Telecom for Connected Britain on the 21-22 September 2021 at the Business Design Centre, London. Find out more at totaltele.com/connectedbritain

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