The 4G boom will be boomer led

Neil Sharman, head of research and analysis, Telegraph Media Group, says that those advertising 4G networks and handsets have the benefit of foresight on their side…

The interesting thing about 4G is that you can see the future. Britain has been slow to adopt 4G and other countries have had it for years. An interesting side effect of our late adoption is that 4G network and product advertisers can learn from the experience of other countries. They know the profile of people likely to adopt 4G.

Take the USA as an example. America has had 4G for more than two years and information on the profile of 4G adopters is available from Nielsen. It is likely that a similar 4G adopter profile will emerge in the UK in two years by which time 3.3 million UK households are forecast to have adopted 4G*.

In the table below you can see the age profile of US 4G adopters. Interestingly, the largest group are the over 45s. Alongside I’ve included the age profile of UK tablet owners which is another technology adopted more by over 45s than under 45s. I’ve done this to show that 4G is not the only technology category with this age profile.

4G marketers will be able to benefit from this knowledge as they launch networks and products in the UK. Perhaps it will help them catch up a little with other countries where marketers might have initially targeted younger groups, paying less attention to those who were soon to become the majority of adopters.

Those advertising the new batch of tablet PCs might also benefit from noting the prevalence of older tablet owners. It is interesting to reflect on the launch of the iPad. The first TV ads looked as though they were aimed at Generation Y but later ads seemed to reflect a wider range of lifestages. Did Apple sense the way buyer profiles were stacking up?

So, why would 4G adoption be led by the Boomer generation? Laying aside our hidden assumptions about technology it makes sense for two reasons.

Firstly, 4G adoption costs money. A survey for Thinkbroadband shows 70% of consumers are currently put off by the price. Nielsen note that teenagers are the most likely group to say they would like to have 4G but Generations X and Y are struggling. 85% of the wealth of the nation now lies with the over 55s**. It is little surprise then that 4G has been adopted by older, upmarket, wealthy groups. This is probably a reason tablet PCs have an older, upmarket profile too.

A second probable reason that 4G is adopted by older groups is that it is a useful tool for business. The average businessperson is in their 40s and the most senior of them are usually older. Businesses will benefit from using 4G instead of a broadband connection in remote areas, using it out on the road and targeting customers via their mobile ‘shop window’.

Maria Miller, the Secretary of State for Culture, Media and Sport has recently said: “Delivering 4G quickly is a key part of our economic growth strategy”. A recent Economist Intelligence Unit report noted that 4G offers some short-term stimulus to jobs and economic activity. As the roll out extends beyond the launch cities and towards the desired 98% coverage of the UK, small and medium sized businesses in the UK will benefit – and these, as my colleague Geoff Copps outlined, are the muscle of the economy.

Last week EE launched 4G in the UK and has a brief window in which to gain customers before their rivals join the chase in the spring. They have been all over newspapers. On the day I’m writing this the double page spread in The Telegraph reads “FTSE 100mph – business just got faster”, utilising The Telegraph’s reach of senior business audiences. EE’s campaign follows Vodafone’s cover wrap around The Telegraph and other newspapers, presumably with an eye on their foray into 4G next year, reading: “After being voted the best, there’s only one way to go…”

It is just possible that EE and Vodafone know exactly where to go. They have benefited from the foresight of knowing who exactly will adopt 4G. Other 4G advertisers will do well to place similar value on older, upmarket and wealthy audiences. For that matter, so would every advertiser everywhere.

*Source: Yankee Group ‘Mobile Broadband Forecast’ 2012. **Mintel – Media Consumption Amongst Over 55s – UK – August 2010