People using search engines to buy wireless services are more valuable customers; potential services revenue in 2005 is $12.6 billion.
Posted Aug 25, 2005
Online search is becoming the major factor in consumer decisions to purchase wireless services, with 72 percent more people using the Internet for that purpose than in 2004. The findings of "The Role of Search in the Wireless Market," released jointly by predictive analytics firm Compete and Yahoo! Search Marketing, indicate that wireless marketers need to focus their efforts on Web content and search engine placement to drive both on- and offline sales. The study surveyed over a one-year period more than 785 Internet users who employed searches to help with their most recent wireless purchases. It found that 23.9 million consumers will have searched online for wireless service information by the end of 2005, representing more than $12.6 billion in potential services revenue.
"The complexity and importance of wireless service has driven consumers online to gather the best, and most relevant, information," says TJ Mahony, managing director of Compete. "Search is not only a navigational feature of this activity, but a fundamental component of 'who' and 'where' consumers will evaluate. Not only is search an important part of the purchasing process, but it is becoming a primary decision-making tool." According to the study, 66 percent of wireless purchasers said they had not decided on a preferred wireless service provider before searching, and evaluated at least two separate providers before making a decision. In addition, offline wireless purchasers reported that search was the most influential media source in their eventual buying decision.
Consumers who arrive at the Web sites of the top-five wireless carriers in the study (Cingular, Nextel, Sprint, T-Mobile, and Verizon Wireless) are three times more likely to sign up for online self-care than nonsearching consumers. Also, those searchers have 17 percent more online self-care sessions per month, making them more valuable customers through greater time spent on the Web site exposed to the provider's products and services.
"Consumers are increasingly coming across service options in a variety of media, and the presentation of plans, products, and options is very complex and confusing," says David Rubinstein, telecommunications category director for Yahoo! Search Marketing. "The people we surveyed said searches were crucial tools because the Internet is the only active medium to let them gather relevant information in a form they can use. For wireless marketers, understanding the significant impact search has on offline purchases is critical to building a successful multichannel marketing strategy." Mahony adds that searches may change the way consumers encounter service options. "The utility of Internet search as a means of disseminating information creates opportunities for mobile virtual network operators like Virgin Mobile to make the Internet a point of first contact, introducing services for the first time to consumers."
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