Pre-paid cards report - Dubit
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Transcript of Pre-paid cards report - Dubit
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Dubit believe that only through a deep understanding of young
people, and keeping close to the audience throughout the strategic
and creative process, can real connections and respect be
achieved.
Through its extensive youth networks that it has built up over ten
years, Dubit provides clients direct access to youth audiences, and
an integrated approach that keeps young people at the heart of the
creative process.
In 2010, we now have 40 professionals across three departments,
who share the identical ethos of ensuring that young people are
understood, involved and entertained by the insight and projects we
deliver:
Research with over 37,000 young people, plus schools & families
Marketing & branding expertise; street & viral techniques
Interactive online worlds, games & learning environments
Pre-paid cards Usage13 -17 years oldsApril 2010
Heritage in youth insightDubit is the leading youth communications company in the UK
We understand the issues surrounding young people in the commercial world, because we’ve experienced it first hand. We research it, create resources for
it, and take our role seriously.
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Details of ResearchDubit Limited ran an online survey over the
18th to the 24th of March 2010.
The survey was emailed to the Dubit
Informer panel. We achieved a nationally
representative sample of 1,000
respondents aged 13-17 years old.
The survey was ten minutes long and
covered the following topics:
• Current sources of income:
• Pocket money
• Salaries
• Pre-paid cards:
• Awareness
• Usage
• Attitudes
• Future intention
• Shopping behaviour:
• Purchases
• Online behaviour
• Researching purchases
• Attitudes towards carrying cash
Research FindingsThis report provides information into awareness and
usage of pre-paid bank cards in the UK amongst 13-17
year olds.
Key HeadlinesEntering an established banking market has been a challenge for pre-paid
cards in terms of generating awareness and engendering itself to the right
consumer base and their needs. At the end of the first quarter of 2010 the
following report scopes the 3.276m* 13-17 year olds in the UK:
42% are aware of pre-paid cards
10% own one or more pre-paid cards
2% receive their pocket money onto their pre-paid card...
...and 1% receive their salary onto their pre-paid card
9% top-up their pay-as-you-go phones via their pre-paid cards
Of those who don’t have a pre-paid card, 73% would consider one after having it described to them
*data from ONS mid-2006 census
Pre-paid cards awareness
Awareness of pre-paid cards (1,000 base)
14, 15 and 16 year olds demonstrated the same level of awareness of
pre-paid cards. 17 years olds exhibited the highest level of awareness,
which you may expect given a greater exposure period.
Pre-paid Cards in the UKIn the last ten years pre-paid cards have really taken off in the US; it is now a growing market in UK consumer finance
Key selling points are that you don’t need to have a credit check and that you can control spend whilst avoiding any risk of debt
The flexibility and control elements are also ideal for students
traveling or people on Gap Years; they have become a natural extension to the 13-17 year old target market
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Uptake of pre-paid cards (438 base - only those aware)
Despite higher levels of awareness amongst males and 17 year olds this
does not convert into higher levels in terms of uptake. Often with
teenagers we find that high levels of awareness converts into intention,
with tightly targeted campaigns and the power of peer to peer
recommendations.
In the case of pre-paid cards, the role of the parent and the nature of the
product suggests that it is a needs based decision, rather than an
emotional purchase. Uptake is diluted amongst 17 year olds as they have
more financial options open to them in terms of personal current accounts.
8 in 10 who own a pre-paid card are single card users, however there are
a minority, predominately males, who own multiple pre-paid cards.
Pre-paid card application (110 base - those who own a card)
43% 39% 25%
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Brand awareness and usage (1,000 base)
O2 Load and Go card holds a significant presence within the market place
in terms of awareness and usage. Its unique position of being available to
O2 customers only, and with the success of the brand as a whole in
optimising their existing customer base, has led to it being the most well
known. Successful marketing campaigns such as its ‘Soap within a soap’
Hollyoaks campaign has cemented its position on the tip of teenage
tongues.
Current card options
O2 Load and Go Card
Exclusively for O2 customers,
the card lends on existing
relations providing free
subscription and usage. Can ‘load’ up to £1,800
per annum at Paypoints and O2 stores. It can
be used abroad (2.75% charge) and for topping
up mobile phone balances. Includes safety
features such as restrictions on over 18 product
purchases.
Virgin Prepaid
Comes with a £9.95 initial
subscription fee (£4.95 for
second cards) and has fees
depending on tariff chosen. The pay-as-you-go
tariff has a 2.95% fee per transaction whilst the
pay monthly has a £4.95 monthly fee plus a
£1.50 charge for each cash withdrawal. The
card offers Virgin rewards such as Holidays,
Experiences and Gym memberships.
Payzone
Can load up to £350 in one
deposit which is instantly
accessible. There is a fee for
loading (£3.95 or £6.95 depending on amount
loaded), a 1.95% fee per purchase or £1.50 per
ATM withdrawal. It also holds an inactivity
charge of £2 for every month not used after 2
months of non-use. Can be used worldwide at
Payzone’s 5,000 cash points.
Neon
A Phones 4U product with a
£9.95 subscription fee and
then no charges for usage. It
has a £500 limit and comes with a number of
bonus features such as discounts a play.com,
napster and ticketmaster.com
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Current Usage
Usage of pre-paid cards (110 base - those who own a card)
53%
45%
32% 32% 30%
19%
12%
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Small purchases
Large purchases that
you save up for
To top up my phone
Gifts (i.e. for someone else)
Purchasing everyday items
Emergency funds
Other
Females are more likely thank males to use the card for multiple reasons
however, on the whole pre-paid cards provide the ability to make a
number of different types of purchases.
Pocket money
77% of all teenagers are receiving pocket money, a % which decreases
with age as employment increases, but otherwise shows no significant
differences across gender, ethnicity or location.
68% receive their pocket money in cash, with 38% having some of their
pocket money paid into their bank account. These remain the main
channels, however 2% receive pocket money directly onto their pre-paid
cards, with 5% of 13-14 year old males receiving onto a pre-paid card.
Salary
38% are in some kind of employment, predominately part time or casual.
Again, cash and bank accounts are the main payment channels with only
1% paid directly onto a pre-paid card.
Those in employment tend to be older, and therefore more likely to have a
bank account. Very few contracted roles currently pay into pre-paid cards.
Mobile Phones
Of the interviewed 99% own mobile phones:
Mobile phone ownership (995 base)
60% 63% 56%
79% 69%
55% 49% 47%
40% 37% 44%
21% 31%
45% 51% 53%
Total Male Female 13 14 15 16 17
Contract
Pay as you Go
Nearly all of those who own a pre-paid card use it to top-up their pay-as-
you-go phone. This is supported by the large number of those with the
Load and Go O2 card, which has to an extent defined the growth within
the market place.
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Purchase behaviour
Shopping Online
How do you shop online (1,000 base)
A majority are either using the internet to browse
for cheapest products or research products
before going to a store to make the purchase.
However around a third are becoming more
engaged with making purchases online because
of the ability to search for a specific product,
achieve the most affordable price or make
impulsive purchases.
Making a purchase
Most still use high street stores to make
purchases, however online usage is prevalent
especially with males.
Where do you make your purchase (1,000 base)
2%
3%
10%
41%
53%
55%
86%
TV shopping channels
Other
Magazine catalogues
Online (catalogue)
Online (retailer direct)
Online (other)
In high street stores
Favorite products
Females show preference for purchasing
products that can require an element of touch or
feel such as clothes, shoes and accessories.
This does not necessarily indicate high-street
purchasing but certainly means that the store
nearly always plays some role in the purchase
journey.
Males are more inclined towards purchasing
CD’s, DVD’s and computer games and as such
online is a more influential channel.
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Topping up pay-as-you-go phone (588 base)
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Future Intentions
In a relatively new market place there are high levels of intention
amongst those who currently do not use, or are not aware of
pre-paid cards. Once the purpose and benefits of a pre-paid
card had been clarified there was positive levels of intention to
apply.
Consideration of those who currently don’t own card (902 base)
73% 66%
79% 78% 81% 79% 69%
57%
27% 34%
21% 22% 19% 21% 31%
43%
Total Male Female 13 14 15 16 17
Won’t
consider
Consider
There are a number of barriers to consideration and uptake
which can be roughly categorised into more permanent barriers
such as competing with bank cards required for 17 year olds in
employment and reasons which could be influenced through
improving communication and education of benefits.
What’s the point when I can
get a debit card which works
the same except prepaid cars actually charge for using
it, and topping up
Too expensive to
use...however looking at the
O2 version as free to me as I recently switched mobile
network
Parents don’t know
about them so would
not understand how they work
I thought it was only available
in certain places for public
transport e.g. London Oyster Card
I’ve wanted one but
am definitely not
prepared to pay a setup fee
Where would you expect to see advertisements (1,000 base)
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Mass media are the key channels for raising awareness of pre-
paid cards and communicating the benefits. With females and
13-14 year olds showing the most positive future intentions,
magazines and television are key.
Outdoor adverts are more popular in densely populated
environments such as London, however it is important to avoid
confusion with Oyster Cards when advertising near public
transport.
Other channels include social networks, especially Facebook
with some mentions of Spotify as it targets a very relevant
audience.
Pre-paid cards have relevance with an often frustrated audience
when it comes to money:
• 9 in 10 have in the past not been able to make a purchase
that they really wanted to
• This includes clothes, fashion, dresses and shoes for the
females. The males also include clothes but also lead to
game consoles, the games and technology
• 67% want more control over their money, with this number
greater for those under 17 and without any form of
employment
• Perhaps more important is the need to provide a safe
alternative with:
• a third having lost their wallet in the past
• 7% having mugged in the past, a % that significantly
rises in London and the Midlands and most alarmingly
amongst Asians that we spoke with, where 21% had
been mugged in the past.