While Millennials do not represent an affluent car buying demographic (in, fact, Millennials exhibit relatively low interest in owning or even driving a motor vehicle) they are extremely influential in shaping the future of the always-connected society, but OEMs struggle to understand the connected consumers and find the appropriate response.

This year, the Millennial Generation will surpass Baby Boomers as the largest living generation in the US.

 

Millennials are the archetype of the always-connected lifestyle and are a tremendous force in shaping the present and future of the ways we produce and consume information, an impact that is quickly becoming cross-generational. In studies, over 70% of Millennials say they influence and are influenced by their peers. They also believe they have significant influence on consumers in other age groups.
 

All consumers in today’s always-connected world, and Millennials in particular, expect uninterrupted access to highly personalized digital information and services throughout their waking hours, including while driving or being chauffeured.
 

While Millennials do not represent an affluent car buying demographic (in, fact, Millennials exhibit relatively low interest in owning or even driving a motor vehicle) they are extremely influential in shaping the future of the always-connected society, but OEMs struggle to understand the connected consumers and find the appropriate response.
 

Lessons from the Consumer Products Industry
Likening the car of the future to a “mobile phone (or a computer) on wheels” has become quite popular among consumers and non-experts. While this observation is a gross oversimplification of the complex technology, supply chain and manufacturing processes involved in getting a reliable and safe motor vehicle to the market, from a consumer’s point of view, the analogy between the IVI system and consumer products is not entirely without merit. Observing the engagement models employed by consumer product companies, most notably smartphone makers and wireless carriers, can be quite instrumental.

 

With a few exceptions, consumer electronics manufacturers can no longer make credible claims for superior technology or even quality. Rather, they establish brand differentiation by concentrating on user experience and customer service, and strive to achieve emotional attachments through deep customer intimacy and aligning the brand with consumers’ expectations and aspirations.
 

Car owners and drivers expect the same top-notch experience from their “mobile phone on wheels.” This analogy, of course, isn’t perfect, but contrasting connected car services delivered by mass market OEMs with consumer electronics vendors is eye opening. As an illustration, let’s take a look at the process of updating navigation maps and points of interest (POI) database:
 

  • Map and POI updates are available from the OEM periodically, typically only once a year. In contrast, smartphone users can access the most recent information from any number of information providers. Furthermore, POI, road condition and other navigation information are updated in real time from multiple sources, including active social media channels.

  • The consumer must pay for updates provided by the OEM, whereas mobile device information is free or, in the case of handheld navigation devices, it is often bundled with the purchase price.

  • Updating a car navigation system using an SD card or a DVD is a lengthy bewildering process that makes the less technology savvy consumer turn to the local dealership for help (which is not always free.) Even simpler tasks can be daunting: auto dealers know to expect customers lining up out the door when daylight savings time changes and the dashboard clock needs to be adjusted.  Smartphone users, on the other hand, are seldom even aware of software updates installed on their devices.

 

This outdated VIN-centric business model places the vehicle—not the consumer—at the center of the connected car universe, a model that is incongruent with the desire to have an uninterrupted experience that is independent of the car the consumer happens to be driving.
 

The Battle for Infotainment Supremacy
In-vehicle infotainment systems are becoming the predominant hub of driver-car interaction, integrating driving management, vehicle management and personal information.  Infotainment head units are the epicenter of rapid innovation in human ergonomics, display technologies and advanced driving features, innovation that comes not only from traditional automotive companies but also from heavyweight outsiders that threaten the status quo, such as Apple’s CarPlay, Google’s Android Auto, and Microsoft’s Windows Embedded Automotive.

 

Automakers recognize that in-vehicle experience is an integral part of the always-connected lifestyle and  consider car electronics, and in-vehicle infotainment in particular, as key enabler and differentiator in the fight to win the hearts of always-connected information-thirsty consumers—both drivers and passengers. But forward thinking OEMs also realize that they are in fierce competition with a superior user experience offered by consumer electronics manufacturers: better user experience accessing a broad, always-fresh, corpus of content and services.
 

On the other hand, built-in infotainment system offers a larger screen and more ergonomic user interface, tight integration with vehicle management data, and, most important, technology and user interface to reduce driver distraction.
 

But the pressure to cram more features and fancy user interfaces into an already busy IVI system isn’t simple. Ford’s bug-ridden Sync IVI created a consumer backlash a scathing Consumer Reports rating. This led Ford to abandon Microsoft and select Blackberry’s QNX as its infotainment platform provider. More recently, a major security vulnerability in Chryslers Uconnect infotainment software led to a recall of nearly 2 million vehicles.
 

Over the Air Software Updates Improve Customer Experience
The battle between the two screens: the large built-in and the smaller brought-in, isn’t likely to be settled in the near future. Carmakers make a strong case for the ability of built-in IVI to deliver better and safer user experience, integrating infotainment, active safety (ADAS) and vehicle management, but they struggle to deliver consistently reliable and user friendly software. On the other hand, mobile device vendors excel in providing excellent user interaction with always-fresh content, but they lack in vehicle integration and the significant risks in using mobile devices while driving are well documented.

 

Innovation, evolution of the AUTOSAR standard and GENIVI Alliance, and demand for greater vehicle software functional safety will continue to energize a rapidly changing landscape of not only technology innovators and IVI suppliers, but also of innovative consumer-centric content and services.
 

To stay relevant and competitive, and take advantage of new innovation, OEMs should adopt an open platform strategy that supports the integration of new technologies and incorporate content and services partners into vehicles in service. They need to be able to provide a continuous stream of software updates not only to keep infotainment content fresh across different and often incompatible infotainment platforms and operating systems, but also release new features and keep active safety features and vehicle management software up to date.
 

It should be clear by now that cost effective and user friendly vehicle software updates cannot be achieved utilizing the outdated service model that requires a visit to the dealership. Highly publicized accounts of Tesla’s remote software update to increase ground clearance in order to prevent incidents that led to Tesla cars catching fire or adding ADAS feature sans a dealer visit, are setting high consumer expectations for frequent, transparent and hassle-free software updates. In contrast, when Chrysler mailed consumers a software update via the U.S. Postal service, it only added to the damage the brand had already suffered.
 

OEMs should take advantage of innovation in over the air (OTA) software updates and use it as a convenient and low-cost technology to promote product quality, safety and customer satisfaction.
 

Learn more on automotive OTA Updates.
 

Joe Barkai - Product and Market Strategist and Catalyst Connect with him on LinkedIn.