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Capping IT Off

Opinions expressed on this blog reflect the writer’s views and not the position of the Capgemini Group

Telematics – the next big opportunity?

Category : Digital Strategies

This year has seen a high proportion of vehicle recalls from car manufacturers across the globe, threatening to eat into the bottom lines of OEMs and erode the trust of consumers. But with the right technology and partnerships in place, and with mobility at the core, automotive companies have a significant opportunity to deliver a range of connected car services that could better control such recall issues.

 Telematics enables a company to monitor the health of a car and predict when issues will occur. If a recall is required, they can use the information to manage the vehicles in response to usage or alert drivers through the dashboard to ensure they are aware of any urgency involved, removing the need for the other forms of communications and follow up.

 However, telematics also has the potential to provide new revenue streams and improve relationships with customers.

 Capgemini’s latest annual Cars Online report shows that some 47% of respondents say they already use connectivity features or would like to do so with their next car, while 80% say they are relevant for their next purchase. Topping the wish list for connected features is driving and safety (84% of customers expressed an interest), followed by vehicle management (78%), and customer care and aftersales services (72%). 

Drivers could soon expect the same degree of connectivity and mobility in their car as in the home or office. Yet different customers want different connected features, and they are not prepared to pay for those they do not want. As a result, OEMs will need to learn more about their customers’ diverse wishes in order to deliver personalized services proactively.

That will require OEMs and dealers to share the large amounts of data about customers and vehicles that they are increasingly collecting. The good news: most customers are prepared to allow access to data provided they know why it is needed and can see the benefits. Around 80% of respondents interested in connected cars say they would share data under the right conditions.

The major reasons for reluctance to use connected features include lack of trust over data privacy and fear of risk of cyber attacks. But building trust can help to overcome such concerns. What’s more, the relationship between transparency around how and why data is being used, and customer satisfaction, is strong.

By applying advanced analytics to data, auto companies will be able to better understand their customers and deliver personalized services in a fully mobile environment. The revenue opportunity if they can do this could be substantial: according to Strategy Analytics, revenues from telematics services globally could exceed $7 billion by 2019. Telematics enables much better control and understanding of recall issues that could potentially cost OEMs billions of dollars, says the research company. There is “the potential for massive cost containment and aftersales revenues, from customer retention management solutions enhanced by telematics”, it adds. [http://bit.ly/1trIb8n]

 OEMs that establish collaborative partnerships with telecoms service providers could be best placed to profit. Areas such as over-the-air software updates, infotainment, security monitoring, vehicle healthchecks and usage-based insurance will rely on robust network infrastructure, with mobility at the core. Cloud-based mobile services will also play an increasingly important role in developing such solutions.

 To maximize investment, OEMs and telcos will need to work with partners that can help them to integrate connected car services into their existing customer relationship management (CRM) and mobile solutions. And in an increasingly competitive and fast-changing market, it’s important to act now to stay ahead of the game.

 Read Cars Online : https://www.capgemini.com/cars-online-2015

 This blog was first published on automotive world website here - http://ow.ly/TL6UR

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Cliff Evans

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