Joerg J. Gutsche, Thomas Hilden

(Business School, Trier University of Applied Sciences, Trier, Germany)

 

 

Abstract: This paper aims to develop a needs-based segmentation of the German smartphone market and to investigate business opportunities from greater product differentiation. In particular, the goal of this study was to prove the suitability of a device with longer battery life, even though the smartphone might increase considerably in its dimensions or weight. This is a promising consideration given that in recent years the smartphone market has become tremendously competitive and saturated, and manufacturers struggle to differentiate from each other. Furthermore, the desire for a longer battery life is becoming more and more prevalent and is a recurring topic of internet polls, blog entries and newspaper articles. The data for this research was collected through a choice-based conjoint analysis with more than half a thousand respondents, supplied by a German market research agency. The results demonstrate a strong desire for an improvement in battery lifetime and a subsequent cluster analysis reveals at least three significant market segments preferring a thicker and heavier smartphone with better endurance. Those segments offer an excellent opportunity for any manufacturer trying to escape the quality and price pressure within an undifferentiated and unprofitable market.

 

 

Key words: choice-based conjoint analysis; needs-based segmentation; German smartphone market; product differentiation; battery life

JEL codes: M31, L63