Smartphones with consumer-oriented functionality score best in a customer satisfaction study released today from CFI Group. A new generation of smartphone, lead by Apple’s iPhone and including Google’s Android and Palm Pre, is bringing in a new customer audience no longer dominated by business users. The CFI Group Smartphone Satisfaction Study, based on surveys of more than 1,000 smartphone users, also finds little relationship between smartphone satisfaction and satisfaction with the provider. Moreover, exclusivity contracts may have drawbacks for carriers if they invite customers drawn to the device and not the provider.
Using the methodology of the American Customer Satisfaction Index to compare smartphone platforms, the iPhone is the undisputed leader in customer satisfaction, scoring 83 on a 100-point scale, 8% higher than its nearest competitors, Android and the Pre (77). Smartphones popular among business users, like Research In Motion’s BlackBerry (73) and Palm’s Treo (70), trail significantly in customer satisfaction, while the “others” category, which includes Symbian and Windows Mobile, scores 66.
The majority of new smartphone owners are using them for mostly personal use, a departure from the early adopters that originally used smartphones primarily for business. This new customer audience has much higher expectations of the smartphone, and the platforms that satisfy these needs rate the highest..
“The iPhone is the best thing to happen to the smartphone industry because it captured the imagination of a whole new set of consumers that might not have made the smartphone jump,” said Doug Helmreich, program director with CFI Group, in the press release. “The iPhone raised the bar not only for other smartphones, but for the networks as well. The new breed of smartphone consumers expect more from their phones, and the iPhone may represent only the tip of a data-intensive iceberg.”
In addition to being the best in satisfaction, the iPhone has the most loyalty and word-of-mouth recommendations. Ninety-two percent of current iPhone respondents say they have their ideal phone, 90 percent have recommended the phone, and 35 percent said they purchased their phone because of a recommendation. Also, the iPhone is the most popular alternative to any other smartphone.
But competition is catching up, and Android and Pre are the most competitive with the iPhone, according to the study. What these platforms have in common is the ability to deliver consumer-oriented activities, like apps, an easy web-browsing experience, and multi-media playback. Business-oriented smartphones, like Treo and early generation BlackBerrys, are falling behind, whereas “generic” smartphones that run Symbian and Windows Mobile are not even on the radar.
“Consumers clearly want to do more with their smartphone, and if you give it to them they will buy it and use it,” said Helmreich. “The good news is that there’s an opportunity to move customers into smartphones. The bad news is that nobody really knows if the networks will be able to handle the stress that will come with data-intensive usage typical of the new wave of smartphone users.”
The study examined the relationship between satisfaction with the smartphone and satisfaction with the provider and found that little correlation exists. The iPhone, which is by far the leader in smartphone satisfaction, has done little to help AT&T’s customer satisfaction among smartphone owners.
Among smartphone providers, Verizon Wireless and T-Mobile tie in overall provider satisfaction, scoring 79. Sprint scores 74. AT&T’s non-iPhone smartphone customers score 73, while its iPhone users rate AT&T 69.
Verizon is the ideal provider for 86 percent of smartphone users surveyed, yet only 38 percent of Verizon smartphone customers say their current phone is their ideal smartphone, the lowest percentage of any provider. Verizon has none of the most satisfying smartphones but still maintains a leadership position in satisfaction on the perceived strength of its network.
For AT&T, the opposite is true. It has the most satisfying smartphone but lags in provider satisfaction, in part because of its network problems associated with its iPhone customers’ overwhelming data use.
AT&T’s exclusive iPhone arrangement with Apple has been a double-edged sword. While it acquired millions of new customers, half of iPhone respondents said they would like to defect to another provider. Forty percent of iPhone users surveyed switched providers to get the phone, and these customers may be dragging down AT&T’s satisfaction score. In fact, iPhone customers that switched providers to get the device rated AT&T 64, which is well behind iPhone users who did not switch, which rated AT&T 72.
“The iPhone has been a cash cow for AT&T, but that cash comes at a cost in terms of overall satisfaction. In effect, switchers can be satisfaction saboteurs if they were not already inclined to choose AT&T,” said Helmreich. “As for Verizon, the scales may tip if customers continue to demand smartphones that the company fails to supply. Then again, will its network hold up if it adds network-heavy smartphones? For now, its an apples to oranges comparison.”
See full results of CFI Group Smartphone Satisfaction Survey at: www.cfigroup.com
Source: CFI Group
Verizon is horrible and there “apps” threw vcast 3.99 for a monthly subscription and 7.99 for some cheesy “app” long live the Iphone!!!
The Windows Mobile share is equivalent to a rounding error.
I told my wife that my inability to judge inches was a rounding error.
@iPhoner
My wife measure not by inches, but by feet for me.
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Meanwhile, another study finds that water is wet.
Another study also finds that icecream is more palatable than dogshit.
@JustMe LMAO. Thanks for the chuckle!
Yeah, yeah, we all knew that. But apparently, if folks like Verizon execs don’t actually begin to understand this study, they will end up squandering away all that customer satisfaction. There is a reason why Verizon has no desirable smartphones: the dictatorship Verizon is running on its handset makers. This cannot be overstated. Verizon’s long-term wireless strategy is to maintain and expand the level of control over devices, with the ultimate goal of being a brand-name wireless solutions provider, with everything under the Verizon label. Handset makers, online content providers, everyone else will have to be generic commodity, according to this strategy. When you buy a phone from Verizon, it will not be a HTC, or Samsung, or Motorola; it will be a Verizon phone, with uniform and consistent Verizon look-and-feel, with functions and features that Verizon decides are necessary or sufficient, and all has to go through Verizon.
The survey makes another thing obvious: the marriage between AT&T and Apple is healthy and happy, and will last a long time, if not forever. Neither company can afford to bail on the other. AT&T has an obvious cash cow that attracts and, more importantly, keeps subscribers (some may want to say, holds them hostage). Apple has a carrier that is willing to pay an exorbitant subsidy (at least twice more than ANY other carrier for ANY other device). If Apple were ever to decide to abandon AT&T, there will be, as the survey suggests, massive exodus of iPhone customers as well.
There is only ONE reason why AT&T can pay north of $400 to Apple for every iPhone activated. AT&T knows that each of those customers with an iPhone will stay with AT&T well beyond the first two years of their contract, most likely not even renewing it, but instead continuing to pay $70 per month (part of which includes monthly phone subsidy) well after their phone has been paid off. They don’t require 3- or 4-year contracts (in order to pay off the subsidy) because they don’t have to; people have no place to go to for the iPhone, and once you had an iPhone, you can’t go Blackberry anymore.
Eventually, AT&T will build out their network and repair their image. For now, the iPhone gamble from two years ago is paying off big time.
So the simple conclusion is, if the iPhone were offered on multiple carriers in the US, it would have to retail for at least $400 again. Nobody could afford to subsidise it by $400+ (as AT&T does now) when the customers can easily bail out and switch carriers after the initial contract expires.
For better or for worse, Apple and AT&T are stuck with each other for a long time.
Now if they could just get autorotation to work like buttah.
predrag –
the iphone subsidy is IN the initial contract. once the contract expires, you’ve already paid that $400+ back to ATT.
urlow:
That’s the point, you haven’t yet! See, everyone seems to believe that the iPhone subsidy is paid off by the end of that contract. Well, AT&T is paying half that amount for subsidising all other smartphones out there (including Blackberries) which all have the SAME mandatory $70 data plan. They also have the same minimum 2-year contract.
The point is, AT&T took calculated risk and decided to subsidy the iPhone by the amount that they can’t comfortably recover within the first contract period, because they knew that the person will remain with the AT&T. They could also allow original (and 3G) iPhone owners to get newer models with full subsidy after 2 years expired because they also knew that all those old phones will be hand-me-downs and will stay on AT&T, continuing therefore to generate the $70 revenue and pay off the original initial subsidy.
Once the iPhone is on Verizon, there would be absolutely NOTHING holding any customer to any carrier, and they’ll go carrier-hopping as they do with all other phones. No carrier will be able to afford the risk of $400 subsidy, only to see the customer bail out before the subsidy has been recovered.
Steve Ballmer would say these words to all of Apple’s products. It’s just a rounding error. hahaha Balmer sucks. And Microcrap will die hopefully by Apple in the future.\
Life is Simple. Get a Mac.
Predrag: you don’t have to hypothesize just compare what’s happening in other countries. iPhone is on all networks in Oz and I think the effect of competition is shown here: http://mobile-phones.smh.com.au/MobilePhones/Phones/Apple/Apple-iPhone-3GS-16GB (take about 20% off those numbers for currency value differences)