Andy Griffiths said customer loyalty to the two companies means most people never consider switching between Android and iOS, so the brands are actually competing for only 20% of customers in the UK.
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| Phablets are the name of the game as Samsung and Apple trade blows over the 20% of the market that actually switches. Photograph: Donald Bowers/Getty Images |
“We hold about two-thirds of the Android base in the UK and we have a very high level of retention. The fact is that it’s a two-brand market and I think people are choosing to go both ways, so we’re always going to be trading customers between us.”
Data from research firm Consumer Intelligence Research Partners suggests that a similar situation exists in the US, where in the past two years 20% of iOS users switched to Android, and 16% of Android users switched to iOS.
Making these switches has become easier, with cross-syncing services helping people to take their personal information such as calendars, contacts and email accounts from one platform to another. Most popular apps are also now available on both platforms.
Smartphone saturation driving ‘kick down’ in sales
The battle for these “floating voters” has intensified as smartphone penetration has reached saturation point in markets like the UK and US, where most people who are likely to buy a smartphone already have one.
That has led to a dip in global sales for Samsung, which, like Apple, is facing up to the challenge of persuading people to upgrade to a newer handset.
“Overall saturation means a kick down in the market as it settles,” said Griffiths. “Once it reaches its new rhythm people will want a better phone than last time, and that step up is what we’ve seen in the UK.”
He added that in the UK, Samsung has helped to grow the premium market – smartphones costing upwards of £400 – by more than 30% since its Galaxy S6 launched in March, and expects that pattern to continue until Christmas.
A growing proportion of that premium market is made up of phablets – smartphones with screen sizes larger than 5.5in. Phablets accounted for 21% of US smartphone sales in the first quarter up nearly four times year on year, according to data from Kantar Worldpanel.
“The phablet category is three times bigger this year than last, and we believe there’s exponential growth in that size of smartphone, with one in 10 of every smartphone sold being 5.5in or above,” said Griffiths.
Phablets here to stay
Phablets also command some of the highest prices in the smartphone market, providing the biggest margins for smartphone manufacturers, explaining why both Apple and Samsung are pushing the supersized smartphone category so hard.
Griffiths said: “If you look at the proportion of the business by value in the premium end, phablets are a substantial sector and something we wanted to add to the recovery in our business in 2015.”
The odd thing about Samsung’s device lineup this year, however, is where and when it is launching its Note 5 phablet.
The Note line pioneered this category back in 2011, but its latest model does not yet have a UK launch date, making its debut instead in the US and Asia. In the UK, Samsung is relying on its 5.7in Galaxy S6 Edge+ for now.
One thing is clear, phablets aren’t going anywhere in the near term, with Griffiths admitting that phone screen size is increasing because “almost one of the last things you do on a smartphone is make a call”.
