CORRELATION BETWEEN CONSUMER SOPHISTICATION AND INNOVATIONS IN THE NIGERIAN TELECOMMUNICATION SECTOR

Abstract

Consumer sophistication has emerged as a crucial determinant of innovation in the telecommunication sector, influencing investment decisions and service delivery. This study examined the relationship between consumer sophistication and innovation in the Nigerian telecommunication industry, focusing on key areas such as 5G network investment, financial services integration, and mobile number portability (MNP). The researchers collected data from 48 managers in 8 telecommunication companies operational in Nigeria, using a questionnaire, designed in Likert 5 – point scale. Three null hypotheses were tested using Pearson Product Moment Correlation Analysis, to assess the link between consumer sophistication and innovations. The analysis examined on how consumer sophistication correlates with investment in 5G technology, financial services integration, and mobile number portability in the Nigerian telecommunication sector. The findings indicate that sophisticated consumers push companies to invest in cutting-edge technologies such as 5G to meet evolving demands. Additionally, mobile financial services, such as digital banking and mobile payments, have become integral to telecom operations due to heightened consumer expectations for seamless financial transactions. Furthermore, the implementation of mobile number portability reflects consumer demand for flexibility and service quality, compelling telecom providers to innovate in pricing, service bundling, and customer engagement. The study concludes that there is a significant, positive relationship between consumer sophistication and innovations in the Nigerian telecommunication sector, as consumer sophistication plays a crucial role in shaping innovation strategies in the telecommunication sector. It recommends accelerated 5G deployment, continuous innovation in financial services, and improved regulatory support for MNP to foster a more dynamic and competitive market. By aligning strategies with evolving consumer preferences, telecom firms can sustain growth, enhance customer satisfaction, and drive industry-wide innovation.