What’s your next step?
Why do car customers make choices, feel satisfaction, and come back again? What do they think about the promise of innovation – mobility services, connected car services, autonomous driving, cyber security, and electric cars? Yes, the car itself matters, but “beyond the car” are real expectations for added value. This report reveals what that means for oems and dealers hoping to win the trust – and business – of today’s informed consumer.
WHAT ARE CONSUMERS THINKING?
Meeting the expectations of informed, “in charge” consumers means innovating throughout the complete customer lifecycle.
The 2017 consumer wants control and convenience. For OEMs and dealers, that means reaching out to each one – with the right information, the right offerings and options, and the right features and functions – at specific moments of value.
Today’s consumers are remarkably well-informed, assertively independent, and highly opinionated about everything: about where to get information and how to use it; about the ways OEMs and dealers could better meet their needs; about what they value now and what they’ll want in the future. How can an OEM or dealer strengthen every customer relationship?
Look: Forget the sale pitch.
When looking for a car, today’s consumers want real information. And they’re getting it from industry experts, independent critics, and large networks of connected groups with common interests. OEMs and dealers have to stay in the loop by using their websites and social media sites to share the right information, to respond quickly and accurately to questions, and to reach out to interested (or even just curious) consumers.
– Key takeaway: Use technology (such as virtual reality) to extend the consumer’s ability to “experience” the car—anytime, anyplace.
Buy: The appetite for online sales continues to grow.
Nearly half of today’s consumers say they would consider buying a car online. And why not, since that satisfies their desire for control and convenience? The upside is that online buyers are open to cross-selling and up-selling. Yet, most still visit a dealer to “see the car in real life”; when there, they expect help in understanding the car’s technology (such as driving assistance features), making car-to-car comparisons, and exploring different configurations.
– Key takeaway: Integrate the virtual and brick-and-mortar worlds to give each buyer a preferred experience.
Own: Communication encourages loyalty.
But how much contact is too much (or too little)? Some car owners want a lot of communication from OEMs and/or dealers; some want none. The best way to know what a customer prefers is to ask. One good opportunity to do that is at the dealer’s, since consumers like authorized service outlets. Also, they want to go online to buy parts, accessories, and digital services.
– Key takeaway: The personal touch never goes out of style.
Repeat: New market entrants have taken—or are looking to take—market share.
For OEMs, the technology companies like Apple or Google will significantly disrupt sales when (and if) they enter the industry. For dealers, used-car resellers are already making a big dent in repeat business by using online platforms to bring together buyers and sellers. The challenge in these trends is age-old and complex: What can OEMs or dealers do to improve customer loyalty?
– Key takeaway: Identify those 10% of car owners who could be encouraged to act as brand ambassadors.
MOBILITY SERVICES – AN OPPORTUNITY, NOT A THREAT
Consumers consider mobility complementary to owning a car. So, participating in the mobility market is a way for an OEM or dealer to introduce drivers to new makes and models.
Mobility services include car sharing (of private groups or from OEMs like DriveNow or car2go), ride-share services (virtual or actual notice boards matching drivers with riders), a multi-modal package (a program covering various means of transportation, such as car-sharing, bike rental, public transport), and mobility on demand (people hailing a vehicle transport as-and-when it’s needed).
The popularity of just one of these options—mobility on demand—illustrates the importance of the overall trend: 50% of consumers appreciate having access to a wide range of cars and services that can be used, as needed, for a fixed price and a specified period of time.
IF YOU CAN’T BEAT THEM, JOIN THEM.
But OEMs should be heartened by the fact that more than half say that mobility services are complementary to owning a car. Enterprising OEMs and dealers might want to offer mobility services to customers, since they’re not a threat to sales but are, in fact, quite the opposite. In fact, OEMs could use their complete portfolio to position themselves as mobility providers. That’s a win-win strategy, since some consumers use a mobility service to “test drive” a car before making a purchase, while others explore their desire for “something new” by taking another brand out for a spin.
CONNECTED CAR SERVICES: NOT A DEAL MAKER OR BREAKER
While consumers say they want connected car services, most are not willing to pay extra for them.
Connected car services (dynamic navigation systems, remote vehicle diagnostics, automatic notification of emergency resources, an apps store, and on-demand, real-time access to music and news) are no longer considered a “value added” feature that consumers are willing to pay extra to get. In fact, most say they’d prefer a “pay per use” model or services that are “included in the vehicle price.”
Getting “connected” isn’t that big a deal anymore.
While the desire for connected car services is strongest in emerging markets (41% of consumers say that they’d like them in their next car), interest overall has declined since 2015 when “connected” was seen as a potential value differentiator. In fact, only 24% of consumers now have connected car services and actually use them. Quite a few – 15% – don’t use the services they have.
That said, are drivers willing to share the data generated in a connected car? The answer is “yes” – but only under specific conditions. For example, one-third say “yes” if they receive an incentive or an extra service; another one-third say “yes” but only anonymously for research purposes.
AUTONOMOUS DRIVING: THE NEXT BIG THING
Even better, consumers are willing to pay for it: 81% of consumers say they’d open their wallets for autonomous driving features, such as advanced driver assistance systems.
Already enthused about advanced driver assistance systems, consumers are eagerly waiting for the next breakthrough: autonomous driving. The success of an OEM in this area will likely depend on its reputation for making reliable, high quality vehicles.
“Wake me when we get there.”
Consumers expect autonomous driving to increase safety, reduce the stress of driving, and free the driver to think about other things. In fact, safety is the #1 benefit consumers are willing to pay more to get. Overall, consumers from emerging markets (China, Brazil, and India) are far more positive about the benefits of autonomous than are their peers in the mature markets of Italy, France, Germany, the UK, and the US.
CYBERSECURITY: AN IMPACT ON THE DECISION TO BUY
Could a hacker steal the car? Could someone access and disable the car’s operating systems? Techno-savvy consumers are concerned about the cyber security of their vehicles.
As cars become more laden with technology, they become more vulnerable. So, it’s only natural that consumers would be worried about the cyber security of their cars. In fact, very few are not concerned about cyber security; nor are they opposed to surveillance.
Show and tell: Give customers information about data collection and use.
Car owners want to control the personal information; one-third want to select which data are collected, transmitted, and used. An additional 26% want to be informed in advance when these activities are performed by someone else. While they’re willing to share data, most consumers agree that they’d like more transparency, as well as more control in which data are collected, transmitted, and used.
ELECTRIC VEHICLES: INTEREST, BUT NOT PASSION
Barriers to acceptance – the cars are too expensive, their range and durations are still limited, and battery charging takes too long – continue to inhibit a significant growth in sales of electric vehicles.
Why aren’t electric cars (EVs) more popular among consumers? What would it take to move the needle on the scale to more sales? Nearly half of consumers (43%) say that charging or exchanging the battery would have to be as quick and easy as filling up the tank with gasoline. Nearly as many say that the electric vehicles would have to be as cheap as their gas counterparts. But despite their lukewarm enthusiasm, consumers do see electric vehicles making important contributions to improving the environment: nearly 50% anticipate more use of EVs for public and commercial transport.
Public policy makes a difference.
In a few countries, government actions are forcing the issue. For example, generous subsidies and incentives are making Norway a model for encouraging electric car sales. Its fleet of plug-in cars is the largest per capita in the world. Similarly, in China the market for its domestic electric cars is propped up by huge government subsidies, as the country intends to be the global leader in clean-energy driving.
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