Using Vehicle Data to Drive Subscription Services

The new era of automotive sales will leverage software-defined elements of the vehicle experience that can be tuned, activated or upgraded dependent on the customers preferences.

Monica McDonnell
Monica McDonnell
2022년 11월 10일 5 최소 읽기
Using Vehicle Data to Drive Subscription Services

Historically, automotive sales and marketing efforts have been focused on infrequent but significant purchases. Whatever vehicle you buy it is likely to be a major investment and one made once every few years. In the previous blog we illustrated how dealers can improve that process by taking on concierge roles that use vehicle as well as customer data to respond to unvoiced preferences. This blog addresses the changing automotive purchase cycles. There are many more software-defined elements of the vehicle experience that can be tuned, activated or upgraded dependent on the customers preferences. Each provides an opportunity for ‘micro-sales’ throughout the vehicle ownership lifecycle. Sales and marketing must shift from focusing on single, high-ticket sales, to maximising customer satisfaction and revenues through ongoing incremental transactions. 

In summer 2022 we caught a glimpse into this subscription driven world. While BMW’s plan to offer heated seats as a subscription had mixed reviews in the media, it is a model that is already becoming more prevalent across the industry. The ability to upgrade infotainment services; tailor comfort features, and even change vehicle performance using ‘over-the-air’ software updates provides a great deal of flexibility for brands and their customers. Drivers and passengers can ‘try before they buy’ and select exactly the combination of features they want. Dealers can tailor vehicles after the initial purchase – allowing for significant changes in functionality for subsequent owners. 

But, to do this effectively, automotive businesses need deeper and broader information on customer behaviour. To deliver compelling and welcome personalised offers, brands need to navigate a narrow and winding road through a world crowded with unsolicited offers, data privacy regulations and savvy consumers adept at ignoring brands. This requires a combination of vehicle and customer data to drive analytics for the sales and marketing team to use in real time. 

The automotive industry lags other sectors in deploying the automation and analytics needed to present customers with exactly the right offers in the right channels at the right time, but it can quickly learn from others to catch up. After all, if the supermarket you visit knows enough about you to suggest items that fully match your preferences, then a brand you’ve spent tens of thousands of dollars with should be able to do the same.

If you have just purchased a vehicle, the last thing you want is to be bombarded with messages suggesting that you subscribe to ‘extras.’ For luxury-brands in particular, it is essential that additional subscription offers are perfectly tailored to the current owner. A vehicle experience is quickly ruined if it is seen as a channel for pushing unwanted features and services. But truly value-add features that can improve the experience of their vehicle in ways that matter will be of interest to any driver if presented at the right time, and in the right way.

Using the heated seats example, it is clear to see the complexity of making that perfect offer. First, the dealer must know the specific vehicle has the hardware fitted to support a heated-seat subscription and that they have the legal and financial ability to offer and fulfil such a service. So far, reasonably straightforward, but still potentially requiring integration of data from two or more separate systems. 

Next, they need to know that they have permission to send marketing messages to the driver – and not just emails. Do they have an app or are there in-car communications systems that have been permissioned for marketing contact? 

Then, it would also be helpful to know that the driver lives or drives in a climate where it is often cold, or perhaps tends to drive early in the morning when a heat seater would be most appreciated. What temperature to they prefer to maintain inside the vehicle? Have they enquired about seat heaters in the past, perhaps including them on configurators only to exclude them at initial purchase?

The final piece of the jigsaw is timing. Customers need to be aware of a feature or experience upgrade when it is relevant and timely. Informing them that seat heater subscriptions are available in the middle of a hot summer may not be the best timing. Equally, if car sensor data suggests a regular morning and evening commute, offers in the middle of the day are less likely to be effective than those immediately before or after a commute when the experience of not having a warm seat is top of mind! 

All this data should be available to sales and marketing teams, but it is often fragmented across silos in numerous departments and IT systems: vehicle data in aftermarket systems, financial data in ERPs and customer information and marketing permissions in CRMs for instance. Providing businesses with the power to combine and analyse these diverse data at scale and in real-time is the foundation of Teradata’s value. 

Working with many automotive brands we have already shown them how to understand their customer’s vehicle usage preferences by analysing vehicle data on types of journey and driving styles. This data, shared with other teams, has enabled pre-tuning of vehicles for specific markets to meet these preferences, and timing new vehicle offers. From here it is a short step to leverage vehicle data to help identify personalised offers for specific drivers. 
Leaders in other industries use Teradata to do this on massive scale. As just one example, financial services customers have triggers across web and app touch points that monitor real-time actions of their customers. They use these to generate personalized messages within milliseconds of an event which lead to significant increases in incremental profit from a broader mix of services and offers taken up. 

The volumes and timeframes may be different in automotive, but the principles are the same: effective integration of data from across the business to drive real-time insights into what customers want. Then getting that information into the hands of sales and marketing so that the right offer can be made through the right channel at the right time.  But we cannot forget the key role the vehicle’s hardware and software elements play in shaping a customer’s experience. Knowing what’s working, what’s used and how often is vital data to ensure the brand experience is maintained. Our next blog will look at how vehicle data can shape research and development focus and investment. 

Please do get in touch if you’d like to discuss how integrated data provides firm foundation for micro-services and incremental revenue. 


약 Monica McDonnell

Monica McDonnell is a highly experienced consultant in the field of enterprise software, digital transformation and analytics. Her career has spanned Africa, the US and Europe with time spent on ERP and supply chain planning before focusing on delivering value from data. Monica advises on how to deliver business value by combining good data governance and advanced analytics technologies. Helping automotive companies understand how to release the full potential of Industry 4.0 technologies, and dramatically improve customer experience management as enabled by the connected vehicle is central to her role. Monica earned a BSc in Industrial Engineering from the University of Witwatersrand, and a MSc in Software Engineering from Oxford University. 

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