Mobile customer segmentation based on smartphone measurement

While customer segmentation for mobile services is typically based on demographics and reported use, smartphone measurement software enables to add directly observed user behavior. This explorative paper develops customer segmentation on relevant metrics from the perspective of network operators, handset manufacturers, and application developers. We analyze the results of a smartphone measurement project among 129 users using latent class analysis. The data are subsequently related to demographics and psychograph-ics, to enable lifestyles. We find that several service clusters can be defined from the perspectives of the usage of the network (i.e. voice, SMS and data) and the usage of content services (i.e. URLs and applications). We demonstrate that such clusters can be related to demographic as well as psychographic segments. The results provide fine grained insights in market segments as well as new hypotheses about mobile behavior that are open for further testing. While being exploratory in nature, the study demonstrates the relevance of customer segmentation on smartphone measurement data. Smartphones have a profound effect on lifestyles as they change the way that people live, work and learn (Ling, 2012). Smartphones come with modern design including touch screen and bigger screen size. With technological convergence, integration of voice, texting, video, gaming, mobile internet and GPS and the increasing capacity of mobile networks, smart-phones are able to provide advanced functionality to their users such as seamless communication, social networking, information, multimedia entertainment, m-commerce, personal productivity tools, and much more. However, the smartphone revolution also poses challenges to the actors in the mobile ecosystem as usage patterns are far from stable. Evolving technologies are enabling novel value-adding services, Internet players are pushing aside communication services from network operators and applications are just as easily hyped as marked outdated. As a result, network operators , application developers and handset manufacturers need to understand and respond to the dynamic change in behavior of users. An important marketing approach to do so is market segmentation, i.e. dividing the addressable market into segments that have a consistent demographic, psychographic or usage pattern. Typically, such market segmentation is based on reported use figures as well as static demographic indicators. Operators and developers do collect actual usage numbers but typically only on their own service offerings. However, smartphones enable a novel way of data collection across any device, network and application by having a background application on the handset log the activities of users. This paper reports on …