Forget Uber: who is really driving disruption in the automotive industry?

Forget Uber: who is really driving disruption in the automotive industry?
July 6, 2017 Jarther Taylor

And what can we do about it?

Jarther Taylor, CEO of Datarati, shares strategic insights into the future of customer relationships in the automotive industry.

In this first post, Jarther explores how the automotive industry can prepare for disruption, drawing from a panel discussion on the Future of the Automotive Industry with leaders from technology and vehicle sectors, co-hosted by Datarati and Saasfocus.


Disruptive Trends in the Automotive Industry

Most private motor vehicles are parked 93% of the time. It’s a confronting data insight revealed again and again by multiple studies into car ownership behaviour across the US, Singapore and UK, and it raises questions around how these resources – cars and the spaces used to park them – can be better used.

We’ve already seen some disruption driven by this behaviour from the likes of Uber or GoGet car sharing.

The simple truth is that disruption happens in every industry. Yet while there is a lot of effort spent in attempts to be ‘prepared’ or ‘plan for’ disruption, these reactions ignore the fact disruption is by its nature unforeseen.

So, if you’re preparing for the ‘next Uber’ you’re preparing for the past.

You’ve accepted disruption, now what?

The first keys you need to unlock the future of your organisation are agility and responsiveness. Make sure you’ve reviewed the following 3 business areas:

  1. Process
  2. Technology
  3. Workforce

(Those 3 business areas might seem obvious, though many organisations don’t do enough to future proof them.)

Here’s the logic: the right process and supporting technology platform can help create an agile workforce.

Your continued investment in those 3 areas will help your culture become more responsive, which is particularly important in the automotive industry, where new product development can take years. It is hard work shifting a culture from multi-year cycles to multi-month (or week), but it’s achievable with the right technology.

Creating a deeper connection to customers will mean they’re more likely to remain loyal, even as your offering changes. You’ll be prepared to help the customer get jobs done (B2B or B2C) or help others help the customer get jobs done, regardless how your industry changes.

Currently most automotive car businesses are organised around the VIN (Vehicle Identification Number) or finance/leasing contract. If that’s to change towards a customer centric model, then significant cultural change required.

Changes in audience behaviour are also shaping the market. Stefanie from Trivett explained that although car sales are not declining, there is evidence of Millennials not getting driving licences, nor aspiring to car ownership. That generational trend doesn’t mean private cars will not be sold, instead, the buyer may just not be an individual.

If car sales go down, but service requirements go up how does that get managed? Will service become more mobile? Will selling become more mobile? This challenge also exists in the trucking industry, noted Marion from Hino Trucks, who explained that truck service models are changing to maximise the time the truck is on the road generating revenue for business owners.

There are huge opportunities to get the customer connection right from the start for new entrants into the Australian market like MG, where panellist Andrew is heading up business development. He explained that new approaches to the technology stack, process and people mean there is great opportunity to leap frog and learn from others’ limitations. There is, of course, also the risk of getting it wrong, he added.

Key insights:

  • Don’t prepare for the next Uber – prepare for the unknown
  • Build strong customer connections to be more resilient to disruption
  • Create deeper connections with your customers through data-driven, personalised engagement

To find out how we can help you, get in touch with us.