Campaign UK

PAUL LEE

PART­NER AND GLOBAL HEAD OF RE­SEARCH FOR TECH­NOL­OGY, ME­DIA AND TELECOM­MU­NI­CA­TIONS DELOITTE

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The UK mar­ket is ap­proach­ing smart­phone sat­u­ra­tion: we es­ti­mate that 90-95% of 18- to 34-year-olds now own a smart­phone and more than 80% of adults in the UK have one.

The smart­phone form fac­tor is ap­proach­ing its op­ti­mal phys­i­cal de­sign. This year’s new smart­phones are likely to look mostly sim­i­lar to those of last year and, crit­i­cally, screen size is not go­ing to in­crease much, which lim­its what can be dis­played.

How­ever, in many less vis­i­ble ways, the smart­phone is likely to im­prove sig­nif­i­cantly – for ex­am­ple, with re­gard to con­nec­tiv­ity speeds.

In the UK, 4G is likely to con­tinue its cov­er­age across the ter­ri­tory, and speeds in ur­ban ar­eas are likely to in­crease fur­ther. 4G en­ables more video, in­clud­ing ads, to be down­loaded and shared. Higher speeds should also en­cour­age greater shar­ing of images and GIFS. They can also un­lock new ad­ver­tis­ing op­por­tu­ni­ties, such as those en­abled by ge­olo­ca­tion-based mo­bile games.

Bet­ter con­nec­tiv­ity may en­cour­age more app down­loads. Smart­phone own­ers are pro­lific users of their ex­ist­ing apps but tend to be re­luc­tant to down­load new ones. Our re­search has found that the ma­jor­ity of UK smart­phone own­ers have no more than 20 apps. Faster con­nec­tiv­ity should en­cour­age more down­loads, as will phones with more mem­ory. There are smart­phones avail­able with up to 256GB of stor­age, but much of the UK’S ex­ist­ing smart­phone base has 16GB or un­der, which con­strains the quan­tity of apps that can be down­loaded.

Brands that per­suade users to down­load apps can ac­cess greater functional­ity, in­clud­ing in-app pay­ment and ad­dress in­for­ma­tion, and have the abil­ity to avoid ad-block­ing.

In-app and mo­bile-browser pay­ments – which can re­duce pur­chase times via a smart­phone to mere sec­onds – are en­abled by in­creas­ingly ubiq­ui­tous fin­ger­print read­ers. By the end of this year, we ex­pect 40% of smart­phone own­ers in the UK to have a fin­ger­print read­erequipped de­vice, of which four-fifths will be used reg­u­larly. This tiny sen­sor could un­lock the full po­ten­tial of mo­bile com­merce.

Ar­ti­fi­cial in­tel­li­gence should also be­come more com­mon, par­tic­u­larly as a grow­ing pro­por­tion of phones in­clude na­tive, on-de­vice AI ca­pa­bil­ity, en­abling anal­y­sis – such as im­age or voice recog­ni­tion – to take place on the phone rather than in the cloud. This should make ap­pli­ca­tions that re­quire AI, in­clud­ing mar­ket­ing-re­lated func­tions, work faster and use less data. We ex­pect at least a fifth of smart­phones shipped this year to in­clude na­tive AI ca­pa­bil­i­ties.

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