BBaker2008_KeitaiKids

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AU by KDDI, the second largest operator in Japan, is the most recent company to release a new child oriented phone. The Junior Keitai series10 was released in the first quarter of 2007 and it shares many of the same features of the Docomo phones; including fun color schemes, a special locked battery, games, and melodies. It also includes a similar tracking service and alarm. However, AU improved the alarm feature, adding a camera that takes a picture of the potential threat to the child, allowing it to be distributed to police (AU by KDDI 2008).

AU, already a very popular brand with youth through its use of television personalities and cartoon characters, also created a series of television commercials featuring a very cute family of hippopotamuses. It should be noted that in Japan there are several successful cases of companies that provide non-child related services, who intentionally created characters that children would like for their promotions in order to grab the parents’ attention through the children’s enthusiasm for the character. 11

Children would sing along with the ads, or run to a product in a store, thus bringing awareness to parents. It appears these commercials may have been created in the same vein. While the cartoon family and catchy song play, the useful reasons to own the phone are told, in effect giving the children logical evidence to convince their parents of why the phone is important and necessary (AU by KDDI 2008).

SoftBank, formerly Vodaphone Japan, is the third largest operator in the country. It too provides a handset for children, the Kodomobile12. The phone comes loaded with

10See #9 in appendix.

11See #10 in appendix.

12See #11 in appendix.

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many similar features to that of the Docomo and AU products. The company provides a webpage that emphasizes the ability of parents to keep track of their kids, as well as a number of ways the phone can help children stay safe when alone. The website makes use of cartoons to express content, but there is a general lack of the type of intensity in which the other companies use their characters (SoftBank 2008).

As of March 15, 2008, SoftBank began airing a commercial13 to promote the Kodomobile along with the company’s new student discount plan. The commercial features the same irregular family as SoftBank’s other very popular commercials: the mother and daughter are Japanese, the father is a white dog, and the son is an AfricanAmerican. In the commercial, the son takes a nap and dreams that he is in elementary/middle school again. His mother stops him before he can leave for school and tells him to take the Kodomobile with him. The sister explains to him that it is the safe option because they can always check where he is. Plus, it came with the student discount. In the next scene, the son arrives at school and two girls immediately seek him out. They point out his new mobile phone and exclaim, “It’s cute!”, “SoftBank!”, and “You’re wonderful!”. They both kiss him on the cheek, and he awakes from his dream. Clearly, this commercial is telling Japanese children that a SoftBank mobile phone can do a lot more for an individual than just help one stay in contact with friends. It will make oneself popular, too (SoftBank 2008).

13 See #12 in appendix.

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SoftBank also released a handset based on a character from one of the most popular and longest running cartoon series, Gundam, at the end of 2007.14 The phone lacks all the usual child mobile phone features, so it should be considered more of a teen-and-up targeted phone. Nonetheless, it has the potential to attract younger fans of the series (SoftBank 2008).

Willcom, Japans fourth largest mobile operator, sells the most interesting handset in terms of marketing to children. The Papipo15 is no exception in respect to child safety features. It blocks emails from unknown addresses, has an emergency alarm button, provides GPS information, restricts mobile Internet access, and has a special lock for the battery. What is most interesting about the handset is that the largest toy producer in Japan, Bandai, manufactures it. Because of this it is literally covered in popular Japanese cartoon characters that are licensed by Bandai, such as Hello Kitty and Tamagochi. The phone also comes preloaded with various Bandai branded media, including online services named “Kids Studio” on the girl phone and “B Studio” on the boy phone, that allow kids to access Bandai games and other content online (Willcom 2008).

There are five versions of the girls’ model, all with different colors and character designs on the faceplate. Each handset comes with two faceplates that can be switched due to user preference. The software includes a fortune telling application, as well as an application that allows the user to add custom designs and images onto a picture taken

14See #13 in appendix.

15See #14 in appendix.

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with the phone; two things very popular with young girls in Japan.16 When “Kids Studio” is accessed, new themes with Bandai characters and other content can be downloaded. There are two different versions of the boy model, both coming with three customizable faceplates. Several applications come preloaded, but when users access “B Studio” they can download various games featuring Bandai brands such as “Digimon,” a very popular boys cartoon, comic, and video game series (Willcom 2008).

The television commercial17 for the girl model involves more characters from Bandai singing and dancing while the narrator tells the viewer that voice calls and emails are free. It then quickly mentions how it can improve a child’s safety. The commercial18 for the boy model is much the same, with the catchy song telling boys about the free voice calls and free emails. The commercial finishes without mentioning any safety features, but does not forget to inform the audience that, “You can play Digimon Savers too!” (Willcom 2008).

With such blatant marketing tactics it is easy to see that Bandai is not only using its strong kids brands to sell the phones, it is then strengthening brand awareness with even more content loaded on the handset. Bandai and Willcom are essentially selling a toy with mobile phone functionality. With free voice calls, email, and content, it may seem that the two companies are missing out on large sources of revenue. However,

16Purikura is a type of photo booth in Japan, in which the photos can be modified before printing. They are extremely popular with girls of all ages. Recently, fortune-telling applications on phones and features in magazines have grown very popular with Japanese girls.

17See #15 in appendix.

18See #16 in appendix.

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using these strong points to sell the product and capture the child market, they are opening a doorway to lifelong customers and lifelong profits.

(1.6) The Importance of Capturing the Child Market

Creating early brand and service loyalty, and thus long-term customers in order to maximize profits from an individual is not a new concept in the business world. Banks have been opening junior savings accounts for years, and even magazines such as National Geographic have started printing child-focused publications, such as National Geographic Kids (National Geographic Kids 2008). Other examples include the global clothing retailer Gap, with its Gap Kids and Baby Gap brands of stores (Gap 2008). Many retailers also maintain stores and promotions online, in an attempt to identify with the “wired youth” and eventually bring them into the brick and mortar stores (Kelley 2002).

Because the mobile industry is attempting to and successfully acquiring increasingly younger subscribers year after year, the question of how important capturing this child market is for content and service providers stands out. The churn rate, the percent of individuals leaving one operator and moving to another, varies greatly from region to region, as well as cohort to cohort. Thus, the time period an operator will make a profit from a single customer is very unpredictable. However, in countries like Japan, where the mobile Internet is commonplace and handsets are standardized, a vast majority of the contents and services can be used on any handset provided by any manufacturer or service provider. In this type of market, a customer

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can remain loyal to content and service companies no matter which operator they support.

Due to restraints of technologies and markets, this is a fairly recent concept and empirical data is very limited. However, the use of messaging services and mobile Internet content on a mobile phone can be seen as an extension of the use of messaging services and other content on the Internet. Therefore, comparing the concept of youth using different Internet providers to access the same content on the world-wide-web to that of the concept of youth using different mobile operators to access the same mobile content, can be insightful. A recent study by Geser (2006) on pre-teen mobile adoption and its effects on usage patterns of mobile phones and services is intriguing and insightful in relation to this comparison.

As stated in examples above, the youth of the world are by far the most active users of new technologies, including the Internet and mobile phones. But this is not simply because they are young and/or growing up in a more technologically advanced age. These factors are more of overarching influences on the underlying reasons. Several studies have found a large correlation between Internet usage and perceived ease of use of, perceived usefulness of, and experience with the Internet (Madden 2003; Porter and Donthu 2006).

In Porter and Donthu’s study (2006), they used a slightly extended version of the technology acceptance model to explain how attitudes determine Internet usage. While they did find that age, education, income, and race are associated with beliefs about the Internet, and that these beliefs affect its usage, they concluded that perceptions regarding

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ease of use and usefulness have a stronger effect. It can then be concluded that an individual who starts using the Internet at an earlier age will be less biased towards it (as most children are with new, curious items), thus they will have an easier time learning how to use it (strengthening the perception of ease of use), and become more intricately involved with the Internet (strengthening the perception of usefulness). Because these perceptions are directly linked with usage of the Internet, someone with a high perception of the Internet will use it more and thus gain more experience with it.

Madden (2003) summarizes her research on how people use the Internet by stating, “Internet users discover more things to do online as they gain experience and as new applications become available. This momentum often fuels increasing reliance on the Internet in everyday life and higher expectations about the way the Internet can be used in matters both mundane and mighty.” She finds that the more experience one has with the Internet, the more they do online and the more often they do it. People with more online experience use content and services such as email, instant messaging, online shopping, online banking, online games, websites for personal and academic research, and financial and news services much more than people with limited experience (Madden 2003). Essentially, they have increased confidence in the technology and use it to perform more significant tasks, more often.

These two findings combined create a very informative reason as to not only why the youths of the world are so open to the Internet, but also why they use it more often and more intensely than any other group. They approach it with an unbiased view, learn how to handle it with ease, develop a strong perception of its usefulness, and then as

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their experience online increases, these perceptions are reinforced and a reliance develops. As youth mobile phone usage can be seen as an extension of computer youth Internet usage, the same conclusions can be assumed. Therefore, it is within reasonable thinking that the younger a mobile content or service provider can acquire a child as a customer, the more natural, useful, and necessary they will find the product; providing a possible long-term customer.

Geser’s study, “Pre-teen Cell Phone Adoption: Consequences for Later Patters of Phone Usage and Involvement” (2006), provides critical supportive data. The study involved 421 individuals in Switzerland (a country with a 97% penetration rate), of which 30% were from a foreign country. He found that the “window of adoption age” has shifted down to between the ages of 10 and 14. He claims that as a consequence, there is a longer period of time for an individual to accumulate contacts in the phone, as well as for other people to rely on contacting the individual through the phone. Thus, a person will grow more dependent on, and intimate with the phone, keeping it with them and turned on more often. Mobile usage will be a self-reinforcing and self-expanding activity; ever more calls are sent and received and ever-higher monthly bills have to be paid (Geser 2006).

In his survey, all the participants were in the age range of 17 to 21, yet split into cohorts based on the age of mobile phone adoption. He found that the cohort that acquired their first mobile phone when they were pre-teens had a 60% higher monthly fee and used text messaging and voice calls 3 to 4 times more than cohorts who acquired a mobile phone a few years later in life. He also found that the contact lists of male pre-

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teen adopters were double the size of others; noticing that mobile phones are affecting the social behavior of males as they grow up (Geser 2006).

The data also showed that only participants that acquired their first mobile phone at age 14 or below agreed at all with statements such as, “The mobile is part of my style of life” and “I could not imagine my life without a mobile” (Geser 2006). It is concluded from this that younger adopters build up higher levels of subjective attachments for the mobile phone and integrate it more fundamentally into their personal life. Therefore it may be expected that with earlier adoption, more positive overall evaluations about how a mobile phone changes the quality of one’s social life will follow. Another interesting discovery is the effect of adoption age increases sharply with the rising current age. In effect, as an early adopter ages and gains more experience with a mobile phone, usage increases year-on-year (Geser 2006).

While the data is limited, there is good evidence to support that earlier adoption promotes a stronger involvement and attachment to mobile phones. As a result, the phone becomes a larger part of one’s life, with dependency and usage increasing. With other data displaying that “wired youth” and possibly “wireless youth” are brand loyal in their online shopping and service use (Kelley 2002; Gaeber and Dolan 2007), companies such as Bandai (mentioned above) could be reaching out to children at very young ages in order to not only capture a present market, but also create a potentially long-term and very profitable future market.

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(2)

Child Mobile Phone Use: The Risks Overwhelm the

Benefits