Venture Insights latest New Zealand (NZ) consumer telco survey shows that telco spending looks robust going forward. The survey showed that more consumers expected to increase their usage of SVOD services, suggesting they see it as a choice for entertainment that could potentially replace more expensive options such as going to the movies, dining out, etc.
What were the findings of the study?
Further, survey respondents stated how such conditions would affect choice of broadband service. Most respondents (77%) don’t plan to change anything. But 17% of respondents said they would respond by upgrading their service, while only 6% planned to downgrade.
Similarly, the survey showed that more respondents are expecting to pay more for their mobile phone service in the next year. While 66% of respondents expected no change, 23% of respondents said they expected to pay more and 11% expected to pay less.
This is all good news for the telecommunications industry. It suggests consumers are starting to see the effects of inflation, and are expecting this to flow into their mobile service despite the impact of interest rates on disposable income. With customers expecting price rises and contemplating upgrades, there will be room for telecommunications service providers to lift prices and/or upsell customers without necessarily triggering a lot of consumer churn.
What were the executive’s thoughts on study?
“The resilience of telco spending intentions was a notable result of our 2022 survey. This shows that mobile and broadband are seen by New Zealand consumers as utilities they cannot do without”, said David Kennedy, Managing Director of Venture Insights.
“Despite rising inflation and interest rates, NZ consumers in 2022 say they expect to spend more on mobile and broadband going forward. And that is good news for the telco industry.”
“This confirms the value of broadband as an enabler of essential and cost-effective services. It also reinforces the view that home broadband is now a utility that households are unwilling to do without. That 23% compares to compared to only 7% in the 2021 survey. So it is clear that pricing expectation have risen significantly over the last 12 months”, Kennedy said.