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Ahead of some broadband and mobile phone providers raising contract prices in April, KPMG UK’s Consumer Pulse survey asked 3000 consumers how they were likely to respond should they face an increase in cost.
The research found that over a third (35%) of consumers say they are most likely to leave that provider once the contract ends, should they face a hike in costs. And a further 5% said they are likely to buy themselves out of the contract to move elsewhere sooner.
A fifth of consumers said they were likely to dispute the scale of the price increase with the company, but an equal amount said they would just accept it and pay it. A further 16% were unsure how they would response.
Nearly one in 10 (9%) consumers surveyed by KPMG said that they had already switched to another mobile provider in the first three months of 2024 to get a better deal.
Seven percent said they had switched their broadband provider, with the same amount switching their TV/music streaming provider, and six percent changing their satellite/cable provider.
Only 6% of consumers said that their mobile provider made them feel valued as a customer, while only 5% said their TV or music streaming provider does.
Should their contract price be hiked, consumers in North West England were regionally the most likely to leave for another provider (43%). Consumers aged 25-34 were most likely (11%) to buy out the contract and take their business elsewhere, with London seeing the most consumers regionally saying they would take that course of action.
Responding to the figures, Linda Ellett, UK Head of Consumer, Retail and Leisure for KPMG, said “While companies are facing their own cost pressures, many consumers continue to operate in a landscape where their costs are squeezed on a number of fronts. The prolonged nature of the cost of living crisis has led many consumers to become more accustomed to shopping around and switching for better deals on all kinds of goods and services. For example, one in ten consumers tell us that they have already changed mobile provider in the first three months of this year, which is perhaps not surprising given only 6% of customers said they feel valued by the sector. Seven percent have also switched their broadband provider.
“Many consumers are faced with April in-contract price hikes and our research shows that a fifth stand ready to dispute the scale of contract increases with the company, while one in three consumers say they will play the long-game and leave for elsewhere once the contract expires. Five percent told us they are most likely to even buy themselves out the contract and move immediately.
“This should all serve as food for thought for businesses navigating whether and how to pass their cost pressures onto the consumer and weighing up the short and long-term benefit.”
