Mobile continues to experience substantial growth in Canada, with smartphone ownership increasing by a staggering 24% year over year. The real story, however, is not in how mobile is growing, but rather how it is changing. Our research reveals that as the Canadian mobile landscape expands, it is evolving in significant – and unexpected – ways.

Mobile is growing – and fast.

The narrative of mobile growth is a familiar one. It comes as no surprise that smartphone ownership is growing in Canada; what is surprising is the rate at which it is growing.

The 2014 study showed that 55% of Canadians owned a smartphone. In 2015, the penetration rate grew to 68%, representing a year-over-year growth of 24% (see Figure 1). This gain in smartphone owners is a significant one that demonstrates how quickly the mobile revolution is progressing.

Figure 1. Canadian smartphone penetration rates, 2014-2015


© Catalyst 2015

As smartphone penetration grows, so too does the demand for newer replacement models. Most smartphone owners are already on their second or third device. In 2014, the mean number of smartphones ever owned by current smartphone owners was 2.12. In 2015, that number increased by nearly 12% to 2.37. Just over a third of smartphone owners bought their first device between two and five years ago; however, we estimate that around 3 million Canadians bought their first smartphone in the past six months.

Segmenting the data by age group reveals how the demographics of smartphone owners have changed in a year. Between 2014 and 2015, the share of smartphone owners in the 45-54 and 25-34 demographics increased most noticeably, while the share of smartphone owners in the 18-24 and 65+ demographic decreased (see Figure 2). It seems the demographic landscape of smartphone owners has expanded to include more people in the middle age range.

All this data paints a picture of a well-established and rapidly growing Canadian mobile landscape. Smartphones are no longer merely prevalent in Canada, but virtually ubiquitous.

Figure 2. Canadian smartphone ownership share by age group, 2014-2015


© Catalyst 2015

Smartphone usage habits are evolving.

Mobile technology has completely permeated the lives of Canadians. Far from being an occasional touchpoint for Internet access and communication on the go, smartphones have become a key part of the fabric of day-to-day life. Canadians are more comfortable with their devices now, and are increasingly using them for everyday at-home activities that previously would have been accomplished on a laptop or desktop computer.

The 2014 study looked at how Canadians were using their smartphones in three key browsing locations – “On the Go,” “At Home,” and “At Work.” Results showed that people tend to use their devices in different ways depending on where they are: at home for long-form content consumption and online purchasing; on the go for checking the weather, sports scores, and social media; and at work for looking up stock quotes, online banking, and emailing.

This year’s survey again asked respondents how they used their phones in each of the three locations. The findings revealed that at-home smartphone usage has risen and on-the-go activity has declined – a surprising discovery given that mobility is one of the main advantages offered by mobile technology. Figures 3 and 4 show the year-over-year change in smartphone usage for activities in both these locations.

Figure 3. Out of respondents who use smartphones as their primary device, % who use it at home

© Catalyst 2015

Figure 4. Out of respondents who use smartphones as their primary device, % who use it on-the-go


© Catalyst 2015

For respondents who use their smartphone as their primary device, at-home usage increased for 20 out of 21 activities. In contrast, only four out of 21 activities (looking for a new car, checking stock quotes, checking sports scores, and buying movie tickets) had an increase in share of time for usage on the go.

Respondents’ frustrations with smartphone technology may provide a clue as to why at-home activity is increasing at the expense of on-the-go activity. As in 2014, battery life and data limits remain the biggest frustrations with smartphones (see Figure 5). People might be conducting more activities at home in part because they are usually connected to Wi-Fi and have easy access to an electrical outlet to recharge as needed. If battery technology improves, and telecommunications companies increase their data caps, this trend may reverse.

Figure 5. Canadians’ top frustrations with smartphones


© Catalyst 2015

The reported smartphone frustrations also reveal a clear preference for larger screens over smaller screens. This preference makes sense in light of increasing at-home usage for activities like watching video and reading articles, which are easier to accomplish on a large screen. Recent large-screen smartphone models like the iPhone 6 Plus and the Samsung Galaxy Note 4 have both responded to and fed this market demand.

Application users are becoming more selective.

The evolution in where Canadians are using their smartphones was not the only surprising change this study uncovered. It also revealed significant changes in the mobile application landscape.

For the majority of smartphone activities, application usage declined year over year (see Figure 6). Notable exceptions to this trend include banking and emailing. Despite the ubiquity of mobile applications, Canadians’ app usage is trending down for most activities, while mobile web usage is trending up – suggesting a general preference for using the browser over apps.

Figure 6. Out of respondents who use smartphones as their primary device, % who prefer to use the application


© Catalyst 2015

This preference is reflected in another key finding: an overall decline in the number of applications on respondents’ phones. While in 2014 smartphone owners reported having an average of close to 26 apps on their phone, that number dropped to just under 19 in 2015.

The decline in applications must mean that people are either downloading apps less frequently or deleting them more frequently. Figure 7 shows that both of these trends are occurring. Between 2014 and 2015, average monthly app downloads decreased by 53%, while average monthly app uninstalls increased by 29%. Once again, battery and data limits appear to be largely to blame for app uninstalls. Respondents identified “drains battery” and “requires Internet connection” as the two biggest app frustrations.

Figure 7. Canadian application download and uninstall rates


© Catalyst 2015

Competition in the application landscape has raised the bar for app performance and retention. Now that the novelty of apps has somewhat worn off, smartphone owners are more discerning about which apps they download, while consolidating ones that serve similar functions. Apps can still be a great way to provide value to consumers, but intense competition means that quality is more important than ever. Smartphone owners will not tolerate or retain apps that take up space on their device without providing significant value in return.

Millennials are giving us a glimpse of the future.

As the largest generational cohort in Canada since the Baby Boomers, Millennials are a segment of the population that is of particular interest to marketers. Conventional wisdom is that Millennials are more connected and tech-savvy than members of older generations. And indeed, this study confirms that members of this cohort are playing a key role in the evolving mobile landscape.

We examined how people in the youngest age demographic (18-24) compared with people in all other age demographics with regard to at-home usage across six common activities – getting directions, finding a new restaurant, reading emails, using Facebook, watching a short video, and checking the weather. Figure 8 shows that most of the growth in these activities is coming from young people.

Figure 8. Growth in share of ‘at home’ users within respondents who use smartphone as primary device for activity

© Catalyst 2015

Interestingly, compared to other age groups, the youngest of the Millennials are more likely to use apps and have a greater number of apps on their phone. In response to the question “How many of your apps have you used in the past month?” those in the 18-24 group reported an average of 8.88 – more than any other age group.

Figure 9. Mobile applications used last month, by age group

© Catalyst 2015

Similarly, this demographic was the only one whose average number of total apps did not decline year over year. It remained the same at 24, while all other demographics’ averages declined.

Figure 10. Average number of mobile applications on a smartphone, by age group

© Catalyst 2015

Brands who are interested in reaching young people should take into account the fact that these consumers tend to be more engaged with their devices at home, and more active on mobile applications, than their elders. Appropriate allocation of resources (such as application development budget) may thus depend to some degree on the age of a brand’s target market.

Mobile is changing. Brands must change with it.

A lot has changed in the mobile landscape over the past year. Not only has smartphone penetration increased by an incredible 24%, but we have also begun to see the emergence of some surprising trends.

Growing screen sizes have turned the smartphone into an ideal device for at-home activities like watching video and reading articles, while ongoing frustrations with battery life and data caps have limited its utility for activities on the go. These same limitations have made real estate on the smartphone highly competitive, as more users are deleting or consolidating apps and turning to the browser instead. Millennials are a driving force behind the trend toward at-home smartphone usage, and are also more active than other age groups on mobile applications.

For brands operating in the Canadian market, this research can be distilled into four key strategic takeaways:

  • With 68% smartphone penetration, mobile is no longer an option but a necessity. All forms of content (long-form, short-form, video, images, etc.) should be mobile-optimized.
  • Mobile consumers are active at home as much as (or more than) they are on the go. Search and display advertising budgets may therefore yield better results on mobile during off-work hours versus during the day.
  • Application development projects should be approached with care. This is a highly saturated space with a selective audience, so brands need to be able to provide a unique value proposition to app users.
  • Millennials are especially active on mobile, including applications. Brands whose target market includes young people should be particularly concerned with offering mobile solutions across both the browser and, if applicable, the app.

In an increasingly connected world, competition is rife and attention is at a premium. The brands that succeed will be the ones who have a clear idea of who their target market is, and how to provide them with a convenient and hassle-free mobile experience that takes into account their ever-evolving habits.

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