Summary

With EVs disrupting the automotive industry, car manufacturers, dealers, and OEM providers face the eternal challenge of keeping customers happy. However, in times of advanced technology such as AI and global business challenges, it’s no longer a question of customer satisfaction. You need to be a step ahead in the league and delight your customers.

This article talks about:

A. Technological disruption in the automotive industry and how it affects dealers and customers

• With the vast majority of vehicles being software-driven, there is always a possibility for technical errors and cyber attacks. Maintaining customer’s trust is paramount for automotive brands and can be a key differentiator in delighting customers

B. How to utilize strategic, revenue, and risk-management opportunities?

• Through the use of structured analysis and customer journey mapping, present the manufacturer with a visual representation of the interaction. This allows the manufacturer to understand how and when messaging is most likely to be effective.
• Anticipate future customer needs.  For instance, if a customer has locked himself out of the car three times in the past month, trigger communications with tips to avoid getting locked out.
• The ability to provide timely and relevant information to customers can be critical to the customer’s safety. Having permission to provide notifications via text or mobile application increases the effectiveness of communication.

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Table of Contents

• Summary
• Introduction
• Disruption in the automotive industry
• Opportunities & Solutions
  • 1. Strategic Opportunity
  • 2. Revenue Opportunity
  • 3. Risk Management Opportunity
• Closing notes
• Reference

Introduction

Over the past two decades, we have witnessed a massive transformation in the automotive industry, driven primarily by technological advances.  When the value in vehicles was once 90% hardware-based, it has shifted to more than 50% software-based. According to Smartcar.com, 91% of new car sales in the U.S. are connected [1]. That’s over 13 million connected vehicles sold in the U.S. alone.  In addition, electric vehicles are now 8.3% of the world’s vehicles.  Self-driving and automated vehicles are now a significant consumer offerings as well, with autonomous vehicles expected to account for about 12 percent of total car registrations by 2030. (Source: Statista.com).  

Like many industries that go through a major evolution, the new technology in the automotive industry has arrived long before infrastructure can be put in place to support the innovations properly.  Don’t forget that we purchased HD TVs well before our cable provider sent us any content in an HD signal. The team at SuiteCX powered by QuestionPro has been working with manufacturers to catch up to the current technology in the auto industry by identifying and prioritizing service support gaps and quickly filling them. 

According to a McKinsey report, the future of automotive looks highly tech-driven. Not surprisingly, this, along with the research and purchase moving more and more online, has dramatically changed the customer’s experience of researching, buying, owning, driving, and maintaining a car.  The team at SuiteCX by QuestionPro has been working in lockstep with automotive manufacturers for over 20 years, helping them navigate through this changing environment and ensuring they evolve to achieve competitive advantage through customer experience excellence.

Disruption in the automotive industry

As technology has taken a front seat in the new generation of vehicles, the industry has undergone a tremendous amount of change.  This has set off a chain reaction of events that significantly impact car manufacturers, dealers, and customers.

1.  60+% of vehicle features are now software driven

The shift toward software-based features means the car has essentially become a rolling software platform capable of delivering services based on data, sensors, and analytics.  While this has significantly benefited the customer in most cases, it also results in more complexity.  As a result, dealers have had to hire and manage entire departments of digital trainers and managers in order to support their customers.  In addition, due to the nature of the software, there are more recalls and unplanned events that create a need to communicate quickly to resolve problems and, in some cases, prevent dangerous situations.  Not only are there software bugs, there is also the risk of cyber-attacks.  So, trust in the manufacturer and dealer is more important than ever.

2. Disintermediation of dealers

The increase in software, which is often developed, supported, and billed by a 3rd party (think SiriusXM, OnStar, etc.), has resulted in the disintermediation of the dealers.  These 3rd parties have their own objectives, especially around service and accessories, and often the dealer is not totally in the loop.  Though the dealer would like to be the primary point of contact for the customer, often the customer goes directly to the 3rd party service provider, who may or may not be able to resolve an issue.  This can result in the customer being bounced around between the 3rd party and the dealer, and/or the dealer is never informed of the issue at all.  Because the brand is ‘responsible’, the fallout from a CX perspective can be significant.

3. Many new entities touching the customer

In this new automotive dynamic, many more people, departments, and companies are looking to engage and communicate with the customer – Dealers, Manufacturers, 3rd Party service providers, and more.  Car manufacturers typically utilize many agencies to manage the brand, design, creative, execution of campaigns, onboarding, and after-market activities.  These disparate teams are typically not coordinated in terms of outreach and communication with the customer.  Even within the dealer, different departments – Finance, Warranty, Service, etc. – are marching towards different objectives, metrics, and incentives.  Each department typically creates its own communication plan to achieve those objectives.  

So, what does all this mean to the customer?

Unfortunately, all of these changes have resulted in a fairly challenging experience for most new car customers.  First and foremost, customers have been overwhelmed by inconsistent, irrelevant, and poorly timed communication.  Inside this blizzard of communication, the customer is unable to differentiate between the communication from a branded entity (corporate or dealer) and other senders.  The customer assumes they are all integrated and coordinated. We have seen cases of a new owner being touched over 94 times in the first six weeks after driving off the lot.  And in many cases, they are more confused than ever with the proliferation of mobile apps and social media sites. 

Compounding the issue is the fact that if they unsubscribe, now there is no ability for the customer to manage or change their communications preferences.  So, even if they wanted to continue to get a select set of communications, they have no way to do that.  Once the customer has unsubscribed, they will miss important communications about issues, or worse, recalls.  And leased vehicles may not be maintained to standards, resulting in higher trade-in costs.

This brave new world has presented challenges to the car manufacturers as well.  Media channels cannot be optimized in this environment, leading to inefficient and ineffective advertising spend.  In addition, due to the heavy reliance on email, once a customer unsubscribes (or simply stops reading) the messages, the car company loses the ability to communicate upgrades and additional services.

Opportunities & Solutions

As is often the case, with disruption comes opportunity, and in this case, there is an opportunity for automobile manufacturers and dealers to improve their bottom line, while simultaneously improving the customer experience.

1. Strategic Opportunity

By understanding the holistic customer experience, including how the customer interacts with the manufacturer/dealer, their key motivators and decision-making process, and then highlighting their moments of truth and pain points, we can suggest improvements in terms of people, process, and data sharing. This is particularly helpful in helping the manufacturers with little direct customer feedback and the dealer with the robust relationship coordinate more.  Through the use of cross-consultative workshops, we can pull disparate teams together to solve existing customer experience issues.

Through the use of structured analysis and customer journey mapping, we can present the manufacturer with a visual representation of the interaction, clearly showing them where they are pushing the customer away versus engaging them.  This allows the manufacturer to understand how and when messaging is most likely to be effective.  Sharing this information with the dealers lets them know what happens at each lifecycle step, so they can also coordinate and optimize their mind-share and spending. 

2. Revenue Opportunity

Manufacturers and dealers that are progressive, are already working together to develop a holistic view of their reputation, sales, and post-sales efforts.  This must be a collaborative and comprehensive endeavor that will improve coordination at critical customer milestones such as onboarding, first service, lease renewal, and new sales.

Once a holistic view is in hand, manufacturers and dealers can effectively use technology to surprise and delight the customer with relevant content, such as tips and techniques, as well as to notify and remind customers about sales and promotions.  The ability to text (or otherwise notify) customers about promotional information is critical to a good experience.

Beyond basic marketing promotions, manufacturers and dealers that understand the customer journey can begin to anticipate future customer needs.  For instance, if a customer has locked himself out of the car three times in the past month, that data can be leveraged to trigger communications to that customer with tips to avoid getting locked out.  And the dealer knows to give the customer a quick lesson the next time that particular customer comes in.

Another great opportunity for both revenue and relationship is to tie the owner, manufacturer, dealer and, in the case of EVs, the power company, into a holistic and relationship-oriented group, ensuring that sales, service and maintenance and charging are all coordinated and friction-free.

3. Risk Management Opportunity

For manufacturers and dealers, the ability to provide timely and relevant information to customers isn’t just important for marketing efforts, it can be critical to the safety of the customer.  The most basic are reminders for planned maintenance and service.  Unplanned events, especially those for software bugs or even more impactful cyber risk issues, can have serious consequences for customers. Events that are communicated quickly and proactively are much better received by the customer.

Knowing the customer’s primary communication channel(s) is of utmost importance, and having permission to provide notifications via text or mobile application increases the effectiveness of communication.

Closing notes

As you see – even the most staid of industries need to seriously think about Customer Experience and ensure that they have a clear view of their customers’ value, needs, and behaviors throughout their whole relationship journey.  The more proactive and collaborative the manufacturers, dealers and even their partners like utilities become, the more likely that EV and autonomous vehicle adoption will be enabled and supported.

Reference

• Don Butler, Ford Motor Company, “Digital Transformation and the Automotive Industry,” CXO Talk, https://www.cxotalk.com/connected-vehicles-automobiles-technology-platform-don-butler-ford