New consumer research lifts lid on what really drives New Growth Markets

The study found that brand, handset quality, and network service quality are strong market drivers in New Growth Markets that sometimes outweigh the cost factors that industry watchers typically expect.

Dr. Walid Moneimne, Senior Vice President, Networks, Nokia said: "The research reveals that from early adoption, New Growth Markets take off very quickly to become more sophisticated about their expectations about handsets and services than some people might immediately think. Price and cost are issues but they are influencing consumers in subtler ways next to equally powerful factors like network reception strength, handset brand value, design, and quality.

These are among the driving forces in new national markets that are contributing to such a rapid pace of growth that we see the world passing its three billionth mobile user by 2010."

In the survey, over 8000 urban mobile phone users and non-users were surveyed in Ukraine, Russia, India, Indonesia and Argentina. The research was done by independent market researcher Synovate between September and November 2004.

Among current mobile users in these New Growth Markets, the research reveals how local operators are building strong businesses based on high levels of customer satisfaction, with an average of 86 percent of surveyed users satisfied with their service.

In some markets like India and Indonesia, satisfaction rates are even higher at 90 and 91 percent, respectively. These figures have added weight because one-third of respondents say they have used a different operator before.

The factors that are driving consumers to choose one operator over another are not simply the availability of low priced tariff plans. The research finds that across all the markets surveyed good reception quality is the main reason for operator choice. When asked why they decided to subscribe to their current operator, network reception quality was the top reason - 48 percent compared to the second ranked factor - a low priced tariff plan - at 41 percent.

In some markets like Indonesia, reception quality was the reason for more than 70 percent of respondents. When those who have switched operators were asked why they had done so, price was more important for most - 44 percent - followed by reception quality at 32 percent.

The study revealed a degree of sophistication in phone usage that points to the potential for offering more advanced services and products. Handset brand is the main factor in phone choice among respondents. On average, 46 percent expressed this opinion unprompted; among the 16-24 age group it is even higher at 52 percent. In India it is 64 percent. Brand is closely followed by the phone's quality and durability, then its cost and its design as leading choice factors.

Voice is regarded as the key application in New Growth Markets. The research confirms its importance for existing users. Almost half of all respondents said they expected that they will make more voice calls in the future- among Indian consumers the finding was closer to 60 percent.

The research also reveals how data content services are beginning to take off, with one in five of the mobile user respondents saying they have used a content service during the last month. There are some interesting national differences, however.

For example, Russians appear to be bigger consumers of weather forecasts, whilst Indians are sports mad with 82 percent of content users accessing sports news; Indonesians prefer fun and games (63 percent) and Argentineans use their mobiles for reading news headlines (58 percent).

The research confirms that the perceived cost of handsets is an important factor for both users and non-users. For example, those who have never owned a mobile phone were asked why they have never owned one - 49 percent said they couldn't afford a phone compared to 30 percent who said they couldn't see a need for one.

The influence of actual cost is subtler than previously thought. The perceived cost remains the main barrier to mobile phone ownership, however for users and non-users alike, costs are typically perceived to be higher than what the actual costs are.