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Telecom Operators Build Consumer Awareness of 3G Through Advertising but Consumer Intent to Adopt Stays the Same

The heavy advertising by telecom operators in the Indian media have succeeded in increasing consumer awareness about 3G mobile services in the country, according to a study conducted by Nielsen. The study shows that awareness levels in 3G service have risen from 64 percent in November 2010 to 80 percent in July 2011.

Among the various 3G services that have been publicized, the Nielsen study shows thatvideo calling services is perceived as being the most beneficial followed by faster connectivity . Sixty seven percent of the survey respondents said video calling was the top perceived benefit of 3G services while 38 percent cited faster connectivity.

“Telecom operators who won 3G spectrum have spent considerable sums and bombarded all available media platforms to increase awareness about the new service. Most advertising has focused on video calling and faster connectivity and as we can see, this push seems to have worked, at least in terms of building awareness about these services’, said Farshad Family, Managing Director – Media, Nielsen.

Building Appeal

While awareness of 3G services might have risen, the Nielsen study shows that telecom advertising  has not been as successful in building appeal or improving perception for the 3G service For the time period that the study was conducted, appeal of the 3G service between November 2010 and July 2011 went up marginally from 41 percent to 43 percent, while perceived relevance of the service went up to 45 percent in July 2011 from 38 percent in November 2010.

“Despite significant spends on advertising,  consumer  perception on two key aspects of the newly introduced 3G service – appeal and relevance –has not improved. And this lack of positive perception is reflected in the likelihood of adoption. The study clearly shows that likelihood of adoption has remained flat since operators rolled out their advertising campaign. While the proportion is still at nearly 20 percent, consumers need marketers to more persuasively demonstrate relevance”, says Family.

Upgrade Opportunity

 An opportunity for  telecom operators is the mobile handset upgrade cycle. The Nielsen study shows that Indian consumers who hope to buy a phone in the next three months plan on spending 50 percent more on their next mobile handset, willing to spend Rs 7200 for their next phone compared to Rs 4600 they spent on their last one, suggesting that smartphones will be within reach for wider segment of Indian consumers.

The upgrade in mobile handset for Indian consumers is largely driven by them seeking more advanced features on their phones. A camera is still the most sought after feature for  49 percent of respondents. An FM radio and the Internet rank second and third respectively, and 15 percent of the respondents also seek 3G services on their next phone.

“The Indian consumer’s quest for a new phone is almost entirely feature driven and while the cameraand FM radio remain favorites, the Indian consumer is also increasingly seeking Internet connectivity via their mobile phone, hoping to finally connect to the growing online community and services. This points to the fact that the telecom market retains its robust demand going forward and the Indian consumers aspiration to upgrade will continue to be a strong driver,” observes Family.

About Nielsen

Nielsen Holdings N.V. (NYSE: NLSN) is a global information and measurement company with leading market positions in marketing and consumer information, television and other media measurement, online intelligence, mobile measurement, trade shows and related properties. Nielsen has a presence in approximately 100 countries, with headquarters in New York, USA and Diemen, the Netherlands. For more information, visit www.nielsen.com.