In more articles than one, I have spoken about the changing consumer behavior and how the expectation of a seamless brand experience is gaining importance more than ever. But I sense now that this notion is evolving, and is much far reaching that that. More and more people are moving towards a life that is connected and seamless in all aspects. This could not be much truer in the case of Mobility.
Everyone who is closely following the happenings in the mobility industry would probably say that people are starting to lose interest in owning cars – as it is becoming expensive, cumbersome, and quite unnecessary in today’s world. Not to mention the numerous services that have mushroomed in the mobility business, and the other more exciting services that are lined up to be launched in the future.
Industry experts predict that the individual of the future will only care about getting from point A to point B – which means we might rent, share, or hitch-hike to our destinations. As the main product (car) itself is becoming a commodity of sorts, the services attached are gaining importance. Services like parking, usage based insurance, live traffic information, speed cameras information, etc. are what individuals will seek and pay for. All of this being provided using data that is collected from the vehicle, coupled with an app on your smartphone. Almost all major Automotive brands have a mobile app that collects vehicle information and presents the user with diagnostics on how he/she is driving the car.
As I had pointed out in one of my previous articles, the role of the OEM is changing in the automotive value chain, and that they are trying to move closer to their customers. Well, that challenge is even more intense now as they are facing new threats. The main interface between the vehicle and its driver is ofcourse the in-dash infortainment system. This system is bought along with the car and some of the services that I mentioned can be offered by the OEM to its customers. It was all going well until Google started offering some free things. With the launch of Apple CarPlay and Android Auto, the consumer started seeing the screen of their in-dash system as an extension of their smartphones. Thus the biggest advantage that Google has with all this is familiarity. People want to be able to search for destinations at home and send those destinations to the car and drive off.
Losing Control – Open Automotive Alliance
To really prepare for an invasion, something called the Open Automotive Alliance has been formed between Android and the major players that contribute to the mobility ecosystem from across the world. This is for the creation of an Android based system that can be used in vehicles. The real question is, are the automotive players going to welcome this initiative with open arms? Why would they lose more control? On the other hand, the consumer doesn’t care for their expensive services and prefers the “free services” of Google.
Why am I not accusing Apple of usurping power from the OEMs? This is because the strategy of Apple here is not to monetise on the screens that they have gained, but to provide a seamless experience in all aspects of the customer’s life. Apple is more device focused.
How Automotive Brands are Coping
Currently the OEMs are handling it by offering extended trial periods of 3 years or more, giving the illusion that the customer is not paying for it – but ofcourse the costs are transferred to them one way or the other. If one looks at how the compatibility of Apple Car Play and Android Auto varies across Automotive Brands, it could be an interesting study in itself. While the top end brands like BMW are compatible with Apple Car Play, they are keeping Android at bay using their premiumness as a shield. On the other hand, brands like Toyota completely refuse to make either App compatible and claim that their infortaiment offerings are more than competent. Once Open Android Alliance starts bearing fruit, surely there would a lot of pressure for the OEMs to convert to an Android platform and lose their individuality in the process.
From Google’s stand point, they do see this as another screen acquisition war. Where there is a screen there is money.