When smartphone manufacturers develop devices, they do so with a target market segment in mind. Not all OEMs produce devices in all classes. However, most of them with sufficient resources tend to make devices across three ‘consumer’ segments. I examine the various mobile market segments in this article.
Mobile Market Segments in the consumer space
• ENTRY LEVEL – Devices in this category are mainly created with very price sensitive customers in mind. As a result, lower hardware specifications are utilized to keep the production costs down. This helps the manufacturer achieve a device in the price range, yet stay profitable – considering the larger volumes that can be moved due to the lower price. The Nokia Lumia 520 is an example of a product in this category.
• MID TIER – In this category, devices are built with more functionality in mind, yet to meet a price point that is below premium. However, this are not flagship offerings, so top of the line components are not necessarily utilized in the production of these devices. Most times, manufacturers will integrate additional value beyond the scope of what’s achievable in the entry range, This is done either through software implementation or the integration of additional services and value. Nokia’s more recent offering- the Lumia 730 is an example of a device that competes in this segment.
• FLAGSHIP – At this level, the manufacturer goes all out to produce a device that is highly spec’d, hardware wise, while offering the latest iteration of the operating system. The flagship device represents a consolidation of the manufacturers differentiating technologies, unique competences and aims to leverage the weaknesses that exist in devices produced with the previous segments in mind. The Samsung Galaxy S5 was the Korean company’s flagship device for 2014. In addition, different mobile operating systems use devices in this category to showcase the extensive range of their latest versions. As a result, consumers are expected to pay a premium for the technologies incorporated in such devices.
However, in recent times, manufacturers have been able to bring devices to market that defy some or all of the above classifications. For example, last year the Chinese manufacturer, One, release the ‘Plus One’ – a device with mainly flagship range specifications, but a mid-range price. 2013 also saw Motorola – which had been acquired by Google, at the time – introduce the Moto G – a mid-range spec’d smartphone with a price tag more suited to an entry level device.
Categories: Subsets of the segments
As a result of the competitive landscape in recent times, new categories are emerging. These new categories seem to involve devices which cut across mainly the mid-tier and flagship segments. These subsets of the already mentioned categories include:
• Phablet category – Devices in this category boast screen sizes larger than 5 inches and tend to include bigger batteries as a result of the extra available space. In some cases, manufacturers also tailor the available software to get optimal use of the larger screen estate – for instance adding extra multitasking functionality. Examples of devices in this category include the Samsung Galaxy Note series, the HTC One Max and the Nokia 1520, to name a few. It is important to note that devices with screens that are larger than 7 inches are regarded as ‘Tablets’.
• Compact category – As a result of consumers yearning for more pocket-able but powerful devices, manufacturers are now stepping in and creating smaller versions of their flagships to meet this demand. This has resulted in devices like the Sony Xperia Z1 compact which is a notable veteran of this category. Smartphones in this range usually are equipped with screen sizes of about 4 – 4.6 inches and pack a mixture of decent, to top of the line hardware.
The enterprise market is big business too…
Outside of the consumer segment exists the enterprise segment. Here, manufacturers target businesses, corporate bodies, institutions and such. Devices in this range are designed with the integration of enterprise-oriented software and value in areas such as, but not limited to, data management, analytics and the ability to interface with already existing enterprise systems. The Canadian manufacturer – Blackberry, till recent times were leaders in this space by a decent margin. Now competition is heating up due to factors like the introduction of the Microsoft and Nokia Lumia devices, and more recently the Apple and IBM collaborative efforts, to name a few.
Apparently, a set exists that wants more niche devices…
It is also note worthy that the mentioned segments above also include subsets, were OEMs might tap into with the aid of niche devices – which exaggerate a particular function, such as – camera centric smartphones like the Galaxy K Zoom or Nokia’s 1020. Remember Sony Ericsson’s range of Walkman branded phones from years back?
And the landscape keeps changing…
We have come from mobiles being large bricks, to the flip phone era when Motorola was notably influential (remember the StarTAC?), to the more pocket-able and powerful devices that were powered by Symbian; to manufacturers creating phablets with large screens that make one handed use seem abnormal. Different mobile operating systems have come, and gone. We’ve seen the smartphone replace a number of devices like dedicated SatNavs, MP3 players, book readers and even cameras’.
Competition in the smartphone market is even now fiercer than ever, especially with all the powerful but price sensitive devices coming from the east (mainly China). As a result, understanding these ever changing mobile market segments is now more important than ever for manufacturers who want to stay in the race. The goal is to satisfy the modern day consumer who is constantly looking for the best value for their money.