NZ consumers willing to spend more on telco services despite economic headwinds

[Melbourne, VIC, September 28th, 2022 –  Venture Insights latest New Zealand consumer telco survey shows that telco spending looks robust going forward.

“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, New Zealand consumers in 2022 say they expect to spend more on both mobile and broadband going forward. And that is good news for the telco industry.”

The survey showed that more consumers expected to increase their usage of SVOD services than to decrease it, 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.

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.

“This confirms the importance 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”, Kennedy said. 

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. 

“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.

This is all good news for the telco 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 telco service providers to lift prices and/or upsell customers without necessarily triggering a lot of consumer churn.

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Note: each year, Venture Insights conducts a consumer survey of approximately 1000 New Zealand telco consumers to check spending intentions, media use, churn intentions and reasons for churn, handset purchasing and interest in fixed wireless access. 

About Venture Insights

Venture Insights was founded to provide our clients with an alternative perspective on the strategic direction and outlook of the digital, media and telco sectors. We believe we have a competitive advantage over existing research providers, many of which have narrow time horizons, through our detailed market models, broad sector coverage and local ANZ focus.

For more information on this report and Venture Insights, please go to www.ventureinsights.com.au or contact us on mailto:david.kennedy@ventureinsights.com.au.