Brook. Not a stream yet, though. But in the foreseeable future, it is going to be a proper river. What are we talking about? Data obtained from vehicles. Experts estimate that data inflow is likely to rise from approximately 33 zettabytes (this is how much we obtained in 2018) to 175 zettabytes in 2052. For OEMs and companies from the broadly-defined automotive industry, this means one thing. Endless monetization possibilities. Providing that they face the challenges connected with data capture, filtering and storage, and become familiar with the in-vehicle technologies enabling that.
The potential is enormous. However, the Capgemini report shows that there is still a long way ahead before reaching its full potential. Today, as many as 44% of OEM customers do not yet avail of any online service in their cars, and still, connecting to the network is just the starting point because without the Internet there is no option of monetizing data. And even if the vehicle is already connected to the network, only every second driver declares frequent use of this type of service.
Anyway, the condition of the Internet is a challenge in itself. Today, in modern vehicles, there are around 100 points from which information can be downloaded (in the future it is estimated that there will be up to 10,000 of them!)
Before we get to know the technologies that enable it (about which we will write in the second part of the article), let’s have a look at the challenges and checkpoints that must be considered when creating a data monetization strategy for a software-defined vehicle.
5 things to bear in mind if you want to monetize vehicle data
1. Developing the customer value proposition
This is where it all begins- from creating a sales offer and an environment in which drivers will believe you have something unique and valuable for them. Without trade, no technology will guarantee your success. Customers will simply not want to share data.
Think about the unique offer you want to present to them and develop a clear data management policy. As a result, it should be followed by the selection of appropriate technologies, and then their implementation in vehicles.
Obtaining data to offer the driver safety or a good sense of direction differs from getting information related to entertainment or directing the customer to a sale in a nearby shopping mall.
It would be perfect if the developed customer value proposition was consistent with your brand’s DNA and features that have always been associated with it. This would make it easier to convince users, remain in line with your business assumptions, and stand out from the competition. Focus on technology application, not on technology just to be used.
2. Consider matching technology with the data for which users are most likely to “pay”
Speaking of users’ preferences, even today, at the stage when the technologies of obtaining data from vehicles are not fully-fledged yet, it can be seen that for some services customers are willing to give up some of their privacy, while they are largely opposed or reluctant towards others.
Capgemini’s research shows that the group with the greatest potential includes services related to safety and facilitating driving:
- hazard warning;
- collision warning;
- theft detection system;
- interactive language assistance.
On the other hand, the greatest objection among users is aroused by services related to broadly -defined shopping:
- In-car delivery;
- in car e-commerce.
Keep this in mind when choosing technology to help you monetize your data.
3. Data collector strategy
The data in the vehicle is acquired by means of special sensors and then sent to collectors, which are supposed to gather this data and enable it to be transferred to the cloud. To effectively filter this data and derive maximum benefit from it, you need reliable technology to facilitate it. Due to the huge amount of data and the interaction between various sensors, the universal data collector is the best solution, as it collects all information obtained from sensors in the car.
In order to fully use its potential, during the implementation phase of this technology, it is crucial to ensure close work of the engineering team with people responsible for digital data management (see the next section). Close cooperation of both teams will help to obtain more interesting data and implement new services more efficiently.
4. Provider of IoT data platform
Collecting data from vehicles is impossible without an IoT platform connected to cloud solutions dedicated to the automotive industry – this is where data is sent and analyzed to be later collected by the vehicle sensors.
Regardless of which platform you choose (the most popular solutions on the market today are: Microsoft Azure, Amazon AWS, and Otonomo, operating in the SaaS system), 5 features that such a platform should have are of paramount importance to enable the efficient flow of information.
You can read more about it in our article on this issue.
5. Data enrichment
While this article focuses on technologies directly related to obtaining data from the vehicle, it should not be overlooked that the software-defined vehicle operates in a wider ecosystem. Monetization of data from vehicles will not be possible without technologies related to infrastructure (e.g. smart-road infrastructure, V2X communication, or high-speed data towers), as well as coordination of back-end processes for which entities such as policymaker, cybersecurity specialist, technical regulator, road infrastructure operator or billing/tolling player are accountable.
To create more valuable and attractive services, a coherent policy is necessary, as it will enrich the data stream from third parties and the user themselves, and will improve cooperation between elements of the ecosystem.
Checkpoints inside the car
In-car technologies are not the only gateway for data that companies can obtain from drivers (another entry point may be, for instance, the driver’s smartphone or road infrastructure). However, they are the ones over which OEMs and manufacturers have the greatest control, technically at least.
Before we directly describe the technologies in the vehicle allowing that data to be obtained, let’s focus on the checkpoints that are crucial for the capture of information, its quality, and value for building services.
In the software-defined vehicle ecosystem, we can identify three such areas, a kind of bottleneck on which the flow of data depends. These are:
- Vehicle interior and infrastructure.
- Connection to cloud.
- Data cloud.
Let’s have a look at the first area, which is practically entirely the responsibility of the automotive company and is directly related to the equipment in the vehicle.
We can list the following groups of such checkpoints which require closer attention when building a data monetization strategy.
1. Gateway to the customer
Key points due to the start of data gathering and the user’s experience – their willingness to share data, and thus increasing the value of the gathered data for the manufacturer.
- HMI (i.e. a set of technologies enabling the driver to activate the vehicle and begin collecting data, e.g. touch screens, visual sensors, voice commands, etc. – certainly a topic for a separate article)
- Data gateway (port, mobile data connection, USB port, radio connection)
- Customer ID
2. Points that build loyalty and the need to buy
That is, the contact points with the offer that allow you to easily download new applications, pay bills and influence the user’s willingness to renew the service. The more transparent, engaging, and easy-to-use, the more likely the user is to continue their subscription.
- App store / ecosystem
- Billing platform
- In-vehicle infotainment (IVI)
- Apps/ content
3. Key points for data security, data analysis and usability
- CPU/ control unit
- Car sensors / actuators
Software-defined vehicles do not run in a vacuum
When creating a data monetization strategy for a software-defined vehicle, one should always bear in mind the wide ecosystem in which such a vehicle operates. It is not enough to equip it with the technology itself and wait for the flow of data that will turn into specific value for the enterprise. In such a complex and extensive ecosystem, nothing happens by itself. There is no room for improvisation, omitting checkpoints, and presenting half-baked offers. Yes, the technology that downloads data from the vehicle is crucial, but it won’t work unless we bear in mind the broader data management context that reaches beyond collecting and analyzing it.
Do you have questions about the article? Want to learn more about vehicle data monetization and the software-defined vehicle ecosystem? Contact the Grape Up, specialists. We will dispel all your doubts and help you develop an effective strategy for vehicle data monetization.