‘Premium phone users drive engagement with premium products’ has been widely accepted knowledge for a long time now. However, a new report has challenged this conventional wisdom, revealing that mid-range smartphone users are driving engagement with premium brands, dispelling the myth that luxury consumption is primarily associated with high-end devices.
The study, conducted by social media platform Bobble AI’s market intelligence division, highlighted that users with devices priced between Rs 9,000 and Rs 20,000 are leading the search and engagement for premium products, accounting for 63.71 percent of digital footprints.
For years, the advertising industry has operated on the belief that high-end smartphone users (Rs 20,000 and above) were prime consumers of luxury goods and services. The report challenged this assumption by analyzing actual online behavior across a range of device users. It found that middle-class smartphone owners, not their affluent counterparts, are more involved in premium fashion, cars, OTT subscriptions, and hospitality services.
Middle class users outnumber their wealthy counterparts
The study was conducted using anonymized and aggregated data from Google search and discussion forums, focusing on two main metrics: Intent Affinity and Premium App usage. Users are divided into three categories based on the price of the device: low-end (below Rs 9,000), mid-range (Rs 9,000–Rs 20,000), and high-end (above Rs 20,000).
The findings showed that middle class users were more active in searching and discussing premium products, representing 63.71 percent of such activities. Surprisingly, high-level users followed with only 9.88 percent, while low-level users accounted for 26.41 percent. The report also revealed that middle-class users showed the highest affinity for all premium categories, including fashion, automobiles, and hospitality, disproving the assumption that high-end smartphone users will dominate.
Differences in digital behavior
The report also examined engagement with premium apps, revealing that middle-class users accessed premium apps with greater intent than high-end users. Although both groups had similar open rates (a metric that measures the percentage of recipients who open an email or other message), high-level users were more passive, with 90 percent engaging in scrolling rather than searching for a product.
High-level users led the session count, but mid-level users weren’t far behind, indicating nearly identical levels of engagement. However, middle-class users were more determined in their interactions, aligning their behavior with specific products.
Meanwhile, time spent on premium apps varies across product categories. Low-level users spent the most time on fashion apps, followed by middle-level users, while high-level users spent the least.
In contrast, high-end users dominated the subscription of OTT and hospitality applications, while middle- and low-end users were slightly behind but showed similar behavior.
The report delivered a clear message that owning a high-end smartphone is no longer a reliable indicator of interest in premium products. Mid-range consumers, who exhibit high levels of engagement and purpose-driven behavior, are emerging as key players in the luxury market. For marketers, this provides an opportunity to rethink strategies and take advantage of this growing demographic, he said.
First published: Sep 23 2024 | 5:34 PM IST