Are consumers comfortable in the digital home?

As the pandemic recedes and the cost of living rises, consumers are rethinking their relationship with connectivity and content inside the home.

In addition, as households become increasingly conscious of global sustainability challenges, service providers must consider their green credentials. The survey revealed that 39% of respondents think connectivity and content providers aren’t doing enough to address climate change and sustainability.

2. Up to a third of consumers plan to downsize their exposure to the online world

The pandemic may have driven up some digital needs, but up to 1 in 3 homes are interested in downsizing their exposure to the online world:

• Thirty-four percent say they plan to reduce the amount of time they spend online as society returns to normal in the wake of the COVID-19 pandemic.
• Thirty-three percent are planning to transfer spend away from connectivity and content and toward other categories.
• More than 20% are interested in reducing the number of music and video streaming platforms they use, as well as the number of connected devices they have in their homes. 

Although pressure on household spending is one factor, many consumers are weighing their needs after years of lockdown periods and restricted mobility. Less time online, reduced levels of spending, or spend concentrated with preferred providers are the potential outcomes. Interestingly, countries that have seen the greatest uptick in demand during the pandemic — Canada, Italy, the UK and the US — also carry the greatest downsizing risks.  

Companies should fine-tune their retention strategies to strengthen their customer relationships during this challenging period. While pricing is one lever, service providers should also consider how higher levels of personalization can help.

3. Online wellbeing and harmful content are critical concerns – particularly among younger users

The public health crisis has compounded, rather than alleviated, pre-existing fears around data disclosure, with 40% of consumers saying they are more worried than before about the privacy of their personal data, compared with the 20% who are more comfortable sharing their personal data than they were before the pandemic. 

Service providers should also take heed of the wellbeing challenges that are top of mind among younger users, as 47% of respondents under 25 often think about the negative impact that using the internet has on their wellbeing. More specifically, anxiety around harmful content is clear, with younger households the most fearful. Forty-seven percent of consumers aged 25 to 44 are very concerned about what members of their household may encounter online. 

If service providers don’t take action to provide more safety and security while online, other entities may well intervene to ensure that online experiences are more trustworthy. Our report shows that 59% feel governments and regulators should be doing more to combat harmful content, with 47% agreeing that the internet should be very tightly regulated to restrict what people can access online. Looking ahead, service providers should consider how they can collaborate to address this problem.

4. Households are looking beyond traditional service bundles

Bundles of connectivity and content are a mainstay of how consumers purchase digital experiences for their home. However, their needs here are changing. Half of households would be likely to take additional privacy or security features as part of their broadband package, while up to one-third would be likely to add services such as smart home (33%), utility services (32%) and home-working features (32%) if available. 

Appetite for these enhancements suggests that household needs are traveling beyond traditional packages that combine broadband with TV or mobile services. Although more than half of households in the study would still choose a TV bundle, a rising proportion of households (29%) say the advantages of buying broadband and TV from the same provider aren’t clear to them. Add to this households’ willingness to swap fixed broadband for a mobile broadband connection (33%) — and it’s clear that consumers’ vision of the ideal package is evolving in new and potentially disruptive directions.

Partnerships with other entities could help broadband providers offer new service combinations, while they can also bundle services in new ways. Twenty-nine percent of households would pay more for broadband with backup options, paving the way for mobile connectivity to play a new role in the home.

5. Positive attitudes toward service providers vary by age and country

A wide array of product and service providers are competing for share of household wallet at a time when pressure on consumer spending has never been greater. Crucially, our survey shows that attitudes toward different types of service providers vary by age and country. Overall, broadband and utility providers score well as perceived data custodians, yet their lead evaporates in younger groups — with mobile operators and streaming TV platform providers the most trusted among users under 25.

Households’ value-for-money perceptions also vary significantly at the country level. Streaming platforms generally enjoy an advantage over pay TV providers, with this advantage narrowest in France and Spain. Meanwhile, broadband and mobile providers tend to outscore content providers on value for money — but this is not the case in Canada or the US. Smart-home value perceptions rank lowest of all services, except for Germany, where they score just ahead of broadband provider content.

These differences underline just how important local market perceptions are, now and going forward. Companies should ensure that they understand the unique conditions in each market they serve and segment their target customers accordingly.  

6. Complexity, confusion and limited confidence create painful customer journeys

As service providers consider how best to meet changing needs, positive customer interactions are critical. Yet relationships with customers are not all they could be. Consumers struggle to make effective choices, with complex and undifferentiated value propositions a pain point for one-third of households. 

Even introductory offers produce mixed results: Over half (53%) of respondents say these offers play a role in their supplier choices, but nearly as many (48%) say such offers make it difficult to work out who offers the best value. Installing and configuring services — whether broadband, TV apps or smart home — are also a headache, with younger customers often the most affected.

And when consumers buy services or seek support, many shy away from digital channels. It’s shown that 42% go to a physical store to purchase a mobile plan, while more than half prefer to use call centers for broadband support. A lack of confidence and understanding informs the need to speak to call center agents and store assistants.

To increase levels of self-service, companies should outline the benefits of online support, ensuring websites and apps are simple and intuitive to use. Clearer value propositions will also help alleviate confusion, in turn reducing the need for human assistance on the path to purchase.