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Inexorable Device Trends – Beyond the Niche, Fad, and Fizzle

Inexorable Device Trends – Beyond the Niche, Fad, and Fizzle – a TUPdate by Dan Ness, March 10, 2017

It can be exciting to see the hockey-stick charts, with everything up and to the right. It’s important to put the numbers into context, though, through a more grounded analysis of the active installed base. Yes, Apple’s long-climb into broader use of their triumvirate is substantial, Smartphones are quickly replacing basic cell phones, and PCs and Printers persist. Their market size confirms their importance.

We humans are wired to notice change. Our very eyes send more information about motion than background. While life-saving should tigers head our way, this capability can be our undoing if we miss gradual changes, like the slithering snake in the grass creeping towards us. Watching an installed base of technology has some parallels. For some, it can seem as if nothing is really changing even while important shifts are taking place.

For over 35 years, I have tracked technology usage trends and profiles, all calibrated by watching customers through surveys such as our Metafacts Technology User Profile. Among other truisms, I’ve seen that true technology trends aren’t sudden. Solid trends are the summation of the habits, preferences, and activities of millions of technology users. They’re inescapable, inexorable, and years in the making. Trends become truly important when they’ve spread beyond being a niche, fad, or fizzle, and reached beyond those first few early adopters.

In this analysis, I’m diving into several key broad dominant trends in technology device usage across American adults. In separate analyses, I’ll drill deeper into the next level of TUP data, revealing which market segments are making the most decisive changes. Continue reading

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Filed under Basic cell phones, Consumer research, Desktops, Devices, Market Sizing, Mobile Phones, Notebooks, Operating systems, Printers, Smartphones, Trends, TUP 2016, TUPdate

Apple’s Long March into the Majority (TUPdate)

Apple’s Long March into the Majority – Dan Ness, October 27, 2016
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For the first time in tech history, Apple has reached the half-way mark in the active installed base. As of our 2016 wave of the TUP survey, 52% of connected adults are using either an Apple Macintosh, iPhone, or iPad. This overall penetration statistic reflects that at least one key Apple device is in the hands of over half of the market.

Apple’s achievement has been from multiple successes – not only one blockbuster. In fact, just as all boats rise together on the same tide, each of Apple iPad, iPhone, and Macs have attained greater market penetration.

The iPhone has lead the charge, passing one-fourth of U.S. connected adults in 2015 to reach 36% in 2016. The iPad has experienced the most dramatic growth, stretching beyond one in five adults in 2015 to 29% in 2016. Of the three key devices, the Apple Mac and MacBooks are starting to mark their mark beyond their prior return customers. Having been strong among students and mobile employees for some time, especially MacBooks, both Apple notebooks and desktops are reaching a wider audience.
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Apple has achieved this in part through balancing proprietary designs with open standards. To encourage and support use by users of only one of Apple’s key devices, each one needs to play well with other competitive products. For example, iPhone and Android Smartphone users need to be able to communicate with each other. Although Apple hasn’t fully opened their iMessage system, basic text messaging works cross-platform. iPad users need to be able to easily browse web pages with as much ease as on a Windows or Android Tablet, even while Apple famously avoided enabling Adobe Flash. Mac users need to be able to share documents with Windows users, and that’s smoother than ever.

Apple’s growing penetration has also been one of expanding breadth. Now effectively half (49%) of Apple’s customers have two or more of Apple’s key devices. Only one year ago, in 2015, only 41% had that many. The most demonstrably loyal Apple customers have the full collection of these three key devices. This continues to be a small group, at 15% of Apple’s customers for these devices, and yet this is a growing group.

Diving into the combinations
To get a more complete understanding into the dynamics, I dove more deeply into the TUP data. One fruitful dimension of our custom forecasting analysis is based on what users have. For most tech products and service, buyers begin with what they have. The current set of products has a strong impact on shaping future choices. For example, when consumers mull buying a tablet, those already using both an Apple Mac and iPhone are more likely to include an iPad in their consideration set than those with no Apple devices at all. They’re also more likely to have an ongoing connection with Apple, even if it’s limited to periodic operating system updates. Similarly, those with any single Apple device are more likely than non-users to at least consider an additional Apple device. Of course, this isn’t automatically true, since in some cases in can backfire if users are having bad experiences with the product, brand, or in this case, the OS ecosystem.

The largest group based on combinations of Apple devices – those who are only using an iPhone, and not an iPhone or iPad. This group has been largest since 2014. Those who have added an iPad to go along with their iPhone have brought this 2-Apple-device combination to be the 2nd-largest. Perhaps surprisingly, the 3rd-largest Apple-device combination is the set of users who have all three. Although this Apple-intense group only represents 8% of all connected adults, it’s grown from being 4% only one year prior.metafacts-td1609-apple-combo-penetration-2016-10-25-1157

Into the [main] stream
With Apple’s move into the majority, will it be harder for Apple to be perceived as elite, special, and “different”?

Even in the 1980’s when I was researching markets for Apple, the company was different and special. From its beginning, Apple appealed to and reached a small share of the market. There have always been certain segments of the market where Apple has dominated at least some of the time, such as among creatives in graphics, marketing, and education.

We are conducting additional analysis of technology users by their employment role and industry, to see where other TUP results point to strongthening or weakening Apple adoption through buyer’s purchase intentions, refresh rates for PCs (Macs), Smartphones, and Tablets, socioeconomic factors, and many other factors.

Looking ahead
We expect Apple’s expansion to continue, although not with as high growth rates as in the past. In the tablet business, Microsoft’s Surface has made recent inroads, such that 12% of connected adults are using a Windows Tablet. Google Android Tablets are also a strong force, being actively used by 17%.

With the recent refresh of the MacBook line, Apple stands to continue its broadening penetration. The foremost  buyers will come from within the ranks of current MacBook and Apple desktops users. We expect a smaller percentage of buyers to come from the ranks of current Windows Notebook users. Stronger yes will be those users with at least one Mac, iPad, or iPhone.

This trope can finally be truthfully said: these segments are Apple’s low-hanging fruit.

About this TUPdate

This TUPdate includes a complimentary brief summary of recent MetaFacts TUP (Technology User Profile) research results. These results are based on the most-recent results of the MetaFacts Technology User Profile 2016 survey, its 34th wave, with 7,334 respondents (US). Trend information is based on prior waves. For more information about MetaFacts and subscribing to TUP, please contact MetaFacts.

Resources

Current TUP subscribers can tap into any of the following TUP information used for this analysis or for even deeper analysis.

The TUP 2016 Devices Chapter details device combinations, as well as device primacy, OS Ecosystems, brand footprint, and other key analysis points.

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Filed under Market Research, Market Segmentation, Market Sizing, Notebooks, Operating systems, Smartphones, Tablets, Technology adoption, TUP 2016, TUPdate

Apple’s Girds Up Its Legs With Handoff

A table is more stable when each leg is strong and when each leg supports the others. In Apple’s most recent operating system upgrade, the Handoff feature stands to capitalize on Apple’s strengths, to stem defections, and possibly to attract new customers.

Apple gets it – to focus on technology users and what users do – and not only on the devices themselves. By making the interaction between key devices fluid, users will be more likely to choose future devices which interoperate instead of buying separate islands.Handoff questions-MetaFacts

Also, while many companies have tried to reduce customer defection by effectively padlocking the exit doors, even skirting consumer protection laws and the ire of the FTC, it’s more positive long-term to provide customers reasons to stay. While many customers recognize their choices will restrict them to a walled garden, they may choose to stay longer provided the fruits are as promised.

Many users are juggling multiple products. Over half – 55% – of Connected Adults actively use four or more devices. This spans PCs, Tablets, Smarpthones, e-Book Readers, and other Connected Devices. Any moves to integrate the user’s experience in a more seamless way will increase the chances that users will choose to stay within a given ecosystem, such as Apple’s.

Handoff promises to let users smoothly juggle their Apple devices in the middle of an activity. For example, when a call or message arrives on a user’s iPhone, they can choose to take the call on their nearby iPad or Mac.

At the current time, 38% of Connected Adults have at least one of the three key Apple devices: an iPhone, iPad, or Mac. However, Apple has a cliff to climb, since 63% of these Apple customers use only one type of these devices.Apple Handoff Size Funnel-MetaFacts

So, at most, today only 37% of Apple’s customers can benefit from Handoff features because they have at least two of the three Apple devices. The actual number is smaller since the Handoff’s full capability will only be available to those with devices which can run the most current operating system.

Apple’s footprint is split by iPhone users and iPad users, at 24% and 20% of Connected Adults, respectively. These two groups overlap minimally. Only 26% of Apple’s customers use both an iPhone and iPad.

Which direction are consumers likely to head? They’ve told us. Among iPhone users, more of those planning to buy a Tablet plan to get an Apple iPad. Among iPad users, more of those planning to buy a Smartphone are planning to buy an iPhone. This bodes well for Apple.

While Microsoft, Google, and the affected competitors could collaborate a coordinated response with their own responses, this will require substantial technical and business cooperation. Continuity capabilities will most likely first come from individual apps. For example, communication apps such as Viber have already extended their capabilities to simultaneously continue conversations across multiple platforms.
Bob Dance - MetaFacts
Consumers have proven they are willing to juggling multiple devices. In doing what MetaFacts calls the BOB Dance, they will choose the devices which are best-suited to a particular tasks, the Best Of Breed (BOB). Then, over time, they opt towards fewer devices and accepting a one-fits-all approach even if the experience is substandard. Witness the death of the everyday digital camera, quickly replaced by Smartphones well before image quality met that of inexpensive cameras.

More-encompassing approaches such as the integration promised by Apple Handoff may herald the era of Fluid Devices, where the user can smoothly and flexibly choose to use their “best” device at the moment that best suits them.

The consumer’s perennial focus on convenience means that Apple’s Handoff capabilities will strengthen loyalty among the Apple-faithful and will slowly increase their footprint among those with at least one Apple device. More importantly to Apple, the heightened conveniences will help delay loss of Apple customers to the Google or Microsoft world.

Source

These results are based on the most recent wave of Technology User Profile, the TUP 2014 edition. The large-scale survey is in its 32nd continuous year, documenting and detailing the full scope of technology adoption and use. In addition to detailing the many devices adults use to connect and sizing targeted market segments, the survey-based research details what people do with their devices. It reports which activities adults primarily use with which device. For example, TUP reports which market segments use their Smartphones or Desktops as their primary communication device, as well as which devices are primarily for entertainment, shopping, social networking, and other types of activities.

Further results and datasets are available to TUP subscribers, including the full details on these technology users: which devices they intend to buy, which other devices they already actively use, the activities they’re doing and which device they do them with, their complete demographic profile, their tech spending, wearable technology, and more.
Technology companies who want to know more about retail or online shoppers, Smartphone users, or about their current or future customers can contact MetaFacts to learn how to subscribe to the rich resources of Technology User Profile.

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