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Insight of the Day: Consumers embrace Artificial Intelligence in the Smartphone market

The latest Worldpanel ComTech study reveals that consumers are increasingly embracing artificial intelligence (AI) features in the smartphone market. Key findings from the study include:

1. Influence of AI Marketing: Smartphone brands like Samsung and Google are successfully leveraging AI features to influence consumer behavior. Samsung's promotion of AI capabilities in its Galaxy S24 series, such as real-time translation and camera enhancements, has resonated with buyers.

2. Consumer Preference for AI Features: One in four Galaxy S24 buyers cited AI as a key reason for choosing their phone, with specific features like real-time translation and camera enhancements being particularly appealing. Google's Pixel 8 range, featuring AI-driven functions like 'Guided Frame', has also attracted buyers who prioritize AI features.

3. Potential Impact on Sales: While the direct impact of AI on sales volumes remains unclear, consumers motivated by AI functionality may exhibit different purchasing behavior. Smartphone manufacturers may explore packaging exclusive AI features into subscription offers to create new revenue streams.

4. Apple's Approach to AI: Despite Apple embedding AI features like Siri and AI-powered camera functions in its devices, the company has not heavily marketed them as 'halo' features. Consequently, recent iPhone buyers are less likely to seek out AI features compared to the average smartphone buyer.

5. Educating Consumers: Educating consumers about the benefits of AI features could influence their purchasing decisions. However, the extent to which AI features drive sales remains to be seen, especially considering Apple's successful sales performance without heavily promoting AI.

6. Future Tracking of AI Impact: Kantar will continue tracking the impact of AI on consumer behavior, including successful AI product innovations, consumer motivations, and the performance of smartphone manufacturers. This ongoing research will provide insights into the role of AI in shaping consumer preferences and purchasing decisions.

Overall, the study suggests that AI features have the potential to influence consumer behavior in the smartphone market, with brands like Samsung and Google capitalizing on AI-driven innovations to attract buyers.

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