8/19/14

A new theory on why Apple device owners spend far more than Android users

What used to be pegged to demographics, namely household income, might be attributable to the type of technology solutions Apple owners desire, one m-commerce expert says.

Bill Siwicki , Managing Editor, Mobile Commerce

Over the years, up to and including today, retailers invariably say the same thing when asked about the value of mobile shoppers on Apple iOS devices (iPhone and iPad) versus the value of mobile shoppers on Android smartphones and tablets: Apple mobile shoppers spend far more time and money than Android mobile shoppers.

In June 2014, for example, 75% of smartphone traffic and sales stemmed from iPhones on the U.S. and U.K. affiliate networks of Affiliate Window, the company reports. 73% of tablet traffic and 84% of tablet sales occurred on iPads, Affiliate Window adds.

Why? Prevailing wisdom points to the price tags on the devices. Apple iPhones and iPads—especially iPads—are the most expensive smartphones and tablets on the market. Consumers who purchase these devices have more money to spend than consumers with Android devices, which often are far less expensive or even free with wireless service contracts. And a consumer who forks over $500 for a tablet (versus, for example, $150) has a tremendous amount of intention to robustly use that device to access the web and apps, mobile technology experts say. (The sophistication and prices of top-of-the-line Android mobile devices, however, are on the rise.)

But here’s a new twist on why Apple mobile shoppers are more valuable to retailers than Android mobile shoppers: Apple users place more value on their time, says Nikki Baird, a managing partner at Retail Systems Research LLC who specializes in mobile commerce.

“It’s not just Apple versus Android, it’s PC versus Mac, too,” Baird says, explaining her theory. “People more attracted to PCs and Android smartphones, a highly fragmented market, don’t mind investing time in computing. They are more willing to fiddle with things, to break things open and get behind the scenes to customize the experiences on their devices.”

In sharp contrast, consumers more attracted to Macs, iPhones and iPads, a rather monolithic market, want nothing to do with technical and custom matters, Baird says.

“Apple people tend to place more value on their time—they don’t want to ‘waste their time’ on those kinds of things that Android users get into,” she says. “Now take that mindset to shopping. For the convenience and ease of use inherent in Apple devices, some consumers, the Apple users, are much more willing to pay a premium price if a device saves them time. PC and Android users are not.”

David Katz, senior vice president and general manager of mobile at Fanatics Inc., No. 47 in the newly published 2015 Internet Retailer Mobile 500, shies away from saying which mobile shoppers are more valuable to the e-retailer. “That’s like asking me which of my children is prettier,” he jokes.

However, while he declines to reveal exact numbers, he does drop a big hint.

“We do see big differences in time and dollars spent by Android shoppers by device,” Katz explains. “Android shoppers on more modern devices, like the new Samsung Galaxy smartphones, tend to have much better shopping metrics than folks on older Android devices.”

So it may be that as Android device makers catch up with the sophistication, not to mention price tag, of Apple devices, the divide between Apple mobile shoppers and Android mobile shoppers may diminish.

But don’t tell that to mobile shoppers in some markets outside the U.S.

“In India and most emerging markets, Android is the smartphone of choice because of cost,” says Radha R, executive vice president of retail and consumer product goods at Mindtree Ltd., a global information technology consulting and services firm whose specialties include e-commerce and m-commerce. She lives in India.

“India is a huge market for Android, which represents about 80% of mobile devices,” she says. “In India, Gen Y consumers’ first phone, for example, is an Android smartphone. And they make great use of them. They are very big into mobile commerce; they order everything on mobile. Overall, the greater share of mobile sales is on Android.”

Follow Bill Siwicki, editor of the 2015 Internet Retailer Mobile 500, and managing editor, mobile commerce, at Internet Retailer, at @IRmcommerce.

Topics:

Android, Apple iOS, David Katz, Fanatics, iPhone versus Android, m-commerce, Mindtree, mobile commerce, Nikki Baird, Retail Systems Research

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