Bundles – Consumers are struggling to find the one that fits their needs

According to a recent survey by consultancy firm Ernst & Young, the fast evolution of the bundle market combined with significant changes in the broadband infrastructure has translated into a vast array of service offerings. This is a sign that innovation and competition in the market are alive and well, however the complexity of the bundles leave in some cases consumers confused. The report suggests that to turn dissatisfied (and willing to switch) customers into loyal customers, service providers should be doing more to tailor their bundle packages to meet the needs of the diverse range of consumers (from “digital devotees??? and “loyal bundlers??? to “serious about sports??? and “functional users???).

The report is an update from a study carried out in 2013 which explored end-users attitudes towards residential bundling. Drawing on results from an online survey of 2,500 UK consumers (April 2016), the Bundle Jungle study explores UK consumer’s attitudes toward multi-play packages which include telecoms and TV services delivered by the same provider. The survey found that:

• nearly a third of consumers find it difficult to find a package that meets their needs, with introductory offers making it difficult to identify the best value deals
• consumers see value in pay-TV but are not convinced of the rationale for including mobile in a bundle
• despite increasing levels of consumer satisfaction, 32% of households believe there is little difference between the bundles offered by broadband providers
• consumers are increasingly switching providers with lower prices and trust levels being the leading triggers to switch (reliability and speed of broadband connection ranked as fourth and fifth triggers, though the former is seen as more important than the latter)

It’s likely that this will get even more complex in the short term too. Whilst operators are working to improve transparency of their offers to consumers, regulators are increasingly focused on ensuring that consumers are able to switch between bundled services. We’ll be keeping a close eye on what this means for the bundle market and how consumers perceive these offers.

This goes to show why retail competition in the UK is so fierce; we are particularly demanding consumers. We find bundle offers both complex and yet not niche enough. The telecoms sector has long seen bundles as the best way to deliver value but on the basis of this evidence, it seems as though consumers are yet to fully agree.