Wireless Shoppers

Google Confidential and Proprietary 1

Wireless ShoppersHow Consumers Shop for Phones and Wireless Service

October 2008


Objectives

• What is the decision making process for wireless shoppers?

• What is the role of Search in the research process?

• Are all mobile phone buyers the same?

Understand the consumer buying process forwireless carriers and mobile phones

Source: Wireless Shoppers Study, Google & Compete


Methodology

Survey of Wireless Phone Buyers

Sample • P3M wireless phone buyers

Sample source • Compete’s 2MM US proprietary panel

Data• Self-reported attitudes and behavior• Overlay of the respondent’s observed

online shopping and searching behavior• N = 1,276• May 2008


Deep Dive into Search Behavior

Sample • Wireless shoppers who reach the

shopping cart of a Big-4 wireless carrier site (Verizon Wireless, AT&T, T-Mobile, Sprint) after using search

Sample source • Compete’s 2MM US proprietary panel

Data• Observed searching behavior used to

arrive at any type of wireless web site including Carrier, OEM, Online Agent and Research or Blog Sites

• Q1 2008


Summary Findings

1 Shoppers Can Be Influenced In the Research Process

2 Search Brings Buyers to Your Site

3 In-Store Buyers Use Search, Just Like Online Buyers

4 Searchers are More Valuable Customers


What is the decision making process for wireless shoppers?


Wireless Carrier Handset OEM

Consumer Uncertainty Exists Prior to Purchase

There is an opportunity to influence what brands consumers purchase, as a big portion of the market starts out undecided

38%didn’t know

exactly 62% knew

exactly79%

didn’t knowexactly

21%knew

exactly

Source: Wireless Shoppers Study, Google & CompeteQ: When you first considered your recent purchase, which statement best describes your mindset about the wireless service provider and handset OEM you would use? Asked of Recent Wireless Buyers, N=1,257, May 2008

Certainty of What Brand Will Be Purchased


Nearly half of wireless buyers base their purchase decision primarily on the service carrier

28%24%

48% Based on carrier

Based equally on phone and carrier

Based on phone

Purchase Decision Driven More by Carrier

Source: Wireless Shoppers Study, Google & CompeteQ: How much of your recent purchase was based on the specific phone vs. the specific carrier? Asked of Recent Wireless Buyers, N=1,257, May 2008

Basis of Purchase Decision


75% of buyers spend less than one week researching, leaving a short window to influence uncertain shoppers

Purchase Decisions are Made Quickly

Time Spent Researching Cell Phone Purchase

Source: Wireless Shoppers Study, Google & Compete Q: How much time did you spend researching your recent cell phone purchase? Asked of Recent Wireless Buyers, N=1,257, May 2008

Less than one day

One to two days

More than twodays, but lessthan one week

1 to 2 weeks

3 to 4weeks

Longer thanone month

35%

21%19%

15%

5% 5%

0%

10%

20%

30%

40% 75%


Cell Phone Buyers Conduct Online Research

78% of all wireless buyers go online to research, with almost half researching exclusively online

Online ResearchOnly

Both Online &Offline Research

Offline ResearchOnly

49% 29% 22%

Source: Wireless Shoppers Study, Google & Compete Wireless Resources Used. Asked of Recent Wireless Buyers using either online or offline research, N=1,044, May 2008

Type of Research Resources Used


More people research on the carrier web sites than in the store. Sites should provide comprehensive phone and plan information.

Source: Wireless Shoppers Study, Google & CompeteQ: Which of the following sources did you use to research? Asked of Recent Wireless Buyers, N=1,257 Q: How much influence did each resource used have on your purchase? (Top 2 Box of 5 Points) Asked of Recent Wireless Buyers Who Used Resource, N=variable, May 2008

Usage and Influence of Research Sources

Wireless Buyers Research on Carrier Sites

% Resource Influence% Using Resource

0%

10%

20%

30%

40%

50%

0%

20%

40%

60%

80%

100%Online Resources Offline Resources

Carrierweb site

40%

57%

OEM web site

16%

60%

Retail website

9%

35%

Consumer reviews

(blogs, etc)

8%

62%

Carrier storesalesperson

22%

55%

Friend orfamily

17%

70%

Carrier storedisplay

16%

67%

Big Boxdisplay

8%

66%

Professionalreviews

(cnet.com, etc)

6%

79%

What is the role of Search in the research process?


Buyers Searched Throughout the Research Process

27% Beginning Only

14% Middle Only

7% End Only

Research Process

Source: Wireless Shoppers Study, Google & CompeteQ: When did you use each resource during your research process? Responses from those who used search. Asked of Recent Wireless Buyers N=1,257, May 2008Note: 2% Didn’t Know or Could Not Recall

When Search is Used During the Research Process

24% of wireless buyers used search, finding it valuable at the top of the funnel and throughout their research

50%Throughout entire process


25% of prospects enter Carrier and OEM sites via a search referral

Search Drives Traffic to Your Site

25%from

Search

Source: Wireless Shoppers Study, Google & CompeteSearch Entry Share of Online Wireless Prospects – Session Based. Quarterly Average Prospect Sessions entering each site via a search referral, Q1 2006- Q1 2008


Shoppers Search For Branded and General Terms

Wireless shoppers search most heavily for specific OEM terms, while almost one quarter of shoppers search on general telecom terms

Search Queries

43%OEM

23%Non-Branded

28%Carrier

Source: Wireless Shoppers Study, Google & CompeteTerm Category Distribution of Search Queries at Google.com – % of Queries at Google.com by Term Category Among Wireless Searchers who reach the Shopping Cart page at a Big-4 Carrier site, Q1 2008 Broad Match


Non-Branded Searchers are Less Decided

Source: Wireless Shoppers Study, Google & CompeteAverage Volume of Sessions and Pageviews among Searchers by Term Category Among Wireless Searchers who reach a shopping cart at a Big-4 site , Q1 2008. Sessions and Pageviews occurred on Wireless Carrier, Agent, OEM and Research web sites.

Wireless shoppers who search on non-branded terms seek more information, likely still undecided on brand.

Non-BrandedSearchers

BrandedSearchers

28 430

19 276

Research Sessions Pageviews

1.5x 1.6xDifference


Many Shoppers Click Only Once or Twice

43% of qualified searchers click only once or twice on wireless sites, while over one third click 5 or more times.

Wireless Shoppers Search Behavior

19%

9%

24%

13%

7% 5% 4%3% 3%

13%

0%

10%

20%

30%

1 2 3 4 5

Number of Search Referrals to Wireless Sites6 7 8 9 10+

43%

Source: Wireless Shoppers Study, Google & CompeteDistribution of Search Referrals – Number of Search Referrals Wireless Shoppers Conduct in the 30 Days prior to reaching Shopping Cart at Big 4 Carrier Site, Q1 2008

Are all mobile phone buyers the same?- Online and In-Store Buyers- Searchers and Non-Searchers


Channel Choice Mirrors Customer Need

Reasons for Buying Online or In-Store

Online

0% 20% 40% 60%

51%Easier

45%Shipped to me

45%Special deal online

43%Better price

36%Faster

25%Avoid salesperson

20%Better selection

In-Store

0% 20% 40%

42%Needed phone now

41%Talk to salesperson

36%Needed to hold phone

29%Faster

29%Easier

21%No shipping cost

19%Special deal in store

19%Was in store already

60%

Source: Wireless Shoppers Study, Google & CompeteQ1: Why did you buy offline rather than online? Please select all that apply. Asked of Offline Wireless Buyers N=819 Q2: Why did you buy online rather than offline? Please select all that apply. Asked of Online Wireless Buyers N=438, May 2008

Wireless buyers purchase online for convenience, while immediacy of usage and customer service drive in-store sales.

Online and In-Store Buyers

Google Confidential and Proprietary

…But 74% of in-store buyers conduct their research online.

Source: Wireless Shoppers Study, Google & CompeteWireless resources used. Asked of recent Wireless Buyers using either online or offline research, N=1,044, Offline Buyers N=633, Online Buyers N=411, May 2008Source: 6% of Wireless gross add orders are made online. Calculated by dividing Compete’s observed quarterly Big-4 online gross add order total by total reported Big-4 gross add orders

Only 6% of Wireless Sales Are Made Online…Online and In-Store Buyers

19


In-Store Buyers Search Like Online Buyers

In-Store buyers use search in their wireless research process with the same frequency as online buyers

Online Buyers26%

In-Store Buyers22%

Source: Wireless Shoppers Study, Google & CompeteWireless resources used. Asked of recent Wireless Buyers using either online or offline research, N=1,044, Offline Buyers N=633, Online Buyers N=411, May 2008Note: Online Buyers 19 sessions In-Store Buyers 20 sessions, Online Buyers 309 pageviews In-Store Buyers 341 pageviews

Percent Who Search During Their Online Research

Online and In-Store Buyers


Searchers are high-end customers. They seek more functionality, are specific about the handset and spend more money on their phones.

Source: Wireless Shoppers Study, Google & CompeteQ1: How much of your recent purchase was based on the specific phone vs. the specific carrier? Asked of Recent Wireless Buyers N=1,257 Q2: Why did you set out to make a cell phone purchase? Select all that apply. Asked of Recent Wireless Buyers not purchasing their first phone N=1,217, Q3: How much did you pay (after any rebates) for your current cell phone (not including the cost of your monthly plan)? Asked of Recent Wireless Buyers N=1,257 May 2008 Note: ** indicates Statistical Significance at the 95% level

Searchers Want More Sophisticated Handsets

Spent over $100on Phone

**33%

Bought a New Phone to Get More Functionality

22%

Purchase Decision Was Based on Phone

Over Service Carrier

SearchersNon-Searchers

**27% 20%

**28% 23%

Searchers and Non-Searchers


Searchers Non-Searchers

*38%

*38%

*24%

**23%

*16%

31%

29%

16%

13%

9%

Use the internet

Send email

Download and purchase digital media

Download and purchase applications

Watch Mobile TV

Source: Wireless Shoppers Study, Google & CompeteQ: On average, how often do you do each of the following on your cell phone? Asked of Recent Wireless Buyers N=1,257, Searchers N=297, Non Searchers N=960, May 2008Note: * indicates statistical significance at the 90% level, ** indicates statistical significance at the 95% level

Activities Performed on Cell Phone

Wireless buyers who use Search in the research process use more value-added services on their phone

Searchers Are More Valuable CustomersSearchers and Non-Searchers


One or two days More than two days, but less than a week

More than a week

Searchers give more consideration to the wireless purchase, making them more open to influence.

Source: Wireless Shoppers Study, Google & CompeteQ: How much time did you spend researching your recent cell phone purchase? Asked of Wireless Buyers N=1,257, Searchers N=297, Non Searchers N=960, May 2008

Amount of Time Spent Researching Purchase


43%59%

29%16%

28%

Searchers Spend More Time Researching

28% 25%

Searcher Non-Searchers

Google Confidential and Proprietary

Searchers Seek More Information from Your Sites

Searchers are more engaged visitors to your site, consuming morewireless content than non-searchers.

Source: Wireless Shoppers Study, Google & CompeteAverage Volume of Sessions among Searchers by category, Q1 2008. Average Volume of Pageviews among Searchers by category, Q1 2008. Sessions and Pageviews occurred on Wireless Carrier, Agent, OEM and Research sites.

Searchers

Non-Searchers

23 405

16 237

Research Sessions Pageviews

1.4x 1.7xDifference



Summary Findings

1. Shoppers Can Be Influenced In the Research Process• Shoppers are uncertain at the onset and are open to influence• Be omnipresent in the marketplace, as purchase decisions are made quickly

2. Search Drives Prospects to Your Site• Ensure enough Share of Voice to capture those that only click 1 or 2 times• Develop a strategy to reach undecided buyers who search on non-brand terms

3. In-Store Buyers Use Search, Just Like Online Buyers• Use Search to target online buyers and in-store buyers• Consider how in-store sales factor into the ROI of your Search investment

4. Searchers are More Valuable Customers• Use Search to attract high spenders and heavy data users• Tailor key words and messaging to meet interest in high-end phones


Q&ASara Kleinberg, GoogleHead of Marketing, Technology

Karen Parker, Compete, Inc.Managing Director, Telecom & Media

Appendix


Glossary of Key Terms

Wireless Prospect: an in-market wireless consumer at a Big-4 carrier site who exhibits shopping and researching behavior, but does not log in or do anycustomer-centric activities.

Wireless Gross Adds: a metric reported by Big-4 wireless service carriers as well as smaller wireless service carriers that denotes the number of new lines of serviceadded each time period. Gross add volumes do not include upgrade or replacement purchases made by existing customers.

Search Referral: Occurs when a wireless shopper enters a query at a major searchengine and subsequently reaches a wireless web site as a direct result of that query. Wireless web sites include:

• Wireless Service Carrier web site• OEM web site• Agent web site• Research web site (i.e., blog, forum, etc.)

Search Query: Occurs when a wireless shopper enters a query at a major search engine but does not necessarily click on it to reach a wireless-specific site

Search Term Buckets: Compete and Google separated search terms into two buckets, branded (Verizon cell phone, Motorola enV, etc.) and non-branded (wireless phone, 3G handset, etc.)

Date post:	13-Sep-2014
Category:	Technology
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