Connected Car 2019Revealing reconnections 2 1Connected Car 20194,500 connected car owners9 countries1 new insightful studyConnected cars are cars equipped with features that allows the car to connect with other devices inside the vehicle and/or to networks and services outside the car. They connect to mobile devices, to the internet, or use sensors to be aware of their surroundings and connect with other vehicles or services.Connected Car 2019: revealing reconnectionsIn 2017, we undertook an extensive study among 8,500 connected car owners across Europe, North America and China to explore the impact of technology on peoples buying decisions, attitudes and usage. We identified that a large proportion of connected car owners had low awareness and understanding of the technological features at their disposal and this was impacting their usage, as well as the way the value these technologies. Precisely 47% of connected car owners didnt even know they had a connected car and 25% of car owners werent actively using their cars connected features.In 2019, we wanted to revisit the study, keen to discover if car manufacturers (OEMs) had made progress and leveraged the opportunities for growth identified. We narrowed the research scope to interview 4,500 connected car owners, specifically in China, USA, Germany, U.K., France, Spain, Sweden, Norway and Denmark by focusing on a few questions asked in 2017.Connected cars. Disconnected owners. Four opportunities to engage drivers. AUTOMOTIVE | Connected Car2Two years on, we find that although progress has been made in many aspects of connected car awareness, owners are still unsure about the benefits they can access. This seems to be primarily due to car companies still not effectively communicating the benefits of the technology or how to use it. China is the exception. Drivers there use the connected car features available much more frequently and are more willing to pay for them, which generates stronger Return on Investments of the manufacturers.We find that the owners willingness to trial connected car features and then sustain their usage, closely mirrors the increased usage of smartphone apps and voice command assistants including Siri and Alexa. It is now essential for car brands to introduce their connected features using the same terminology, attitude and approach that people are familiar with. Connected Car 20193Weve highlighted a summary of our four key insights from 2017, followed by the 2019 updates, allowing a simple, direct comparison between the two.Real-world relevanceShow and tellWhen users get it, they want to keep getting itTried and trusted12345Connected Car 20192017 insightConnectivity on its own is low on the list of purchase considerations, but by linking it to real-world benefits such as increased safety and better economy, manufacturers can show its value in a relatable context. This helps it to make sense for drivers who dont really want to know how it works but do want to understand how it can benefit them directly on their daily drive.1Real-world relevance2019 updateIn a world dominated by technology brands, connectivity remains one of the least important factors taken into consideration when buying a car. The same motivating factors dominate the purchasing decision price, fuel consumption, safety, reliability, comfort and brand image. In markets like China, U.K. and Spain we observe that fuel type has become a stronger purchase motivator, resonating directly with the push of their governments and manufacturers toward electrification. Connectivity is still not related closely enough to a clear end benefit such as safety or comfort or even fuel consumption for car buyers to make it more decisive in the purchase funnel.PURCHASE MOTIVATORSSafety Comfort PriceFuel economyConnectivity Self-driving capability40% 39% 39% 39% 9% 4% Aggregated data (U.S., China, U.K., Germany, France, Spain and Nordics)Connectivity ranks low4Connected Car 2019The willingness to buy connected cars is however growing in most markets. U.K., France and Spain have seen a significant upward trend, but the real opportunity still remains in the U.S., where promotion and education are required to convince car buyers about the value of connected features. Indeed, only a little over 50% of Americans are willing to buy a car with connected features, while in Spain and China, this is closer to 80%.Real-world relevance (contd.)1A new discovery was a rise in the demand for a voice-command interface in cars. This service has made its way up on the wishlist of in-car online activities, particularly in China. People who now use voice-activated virtual assistants at home and on their phone, want their car to exhibit the same smart vocal technology that they enjoy in other aspects of their daily routine. Integrated voice activation needs to be part of every product roadmap. The wishlist of in-car online services is stable in time except for voice-command features. With highest increases seen in China, followed specifically by Spain (23% to 35%). Only the U.S. has a more modest growth rate, showing just a 1% increase.WILLINGNESS TO BUYA growing appetite for connected car purchases among users+9% 88% China+2% 54% U.S.+8% 67% Nordics+8% 61% Germany+21% 67% U.K.+16% 63% France+14% 81% Spain% definitely /very likely to buy a car with connected featuresEvolution from 2017WISHLIST OF IN-CAR ONLINE SERVICES U.K., Germany, France & Spain24% +7% China34% +13% U.S.26% +1% Nordics23% +8% Stable in time except for voice-command features% mentioned 2019Evolution from 20176 7Connected Car 20192017 insightIf people dont know a connected feature exists in their car, let alone how to use it, its unlikely to play an important role in their purchasing decision or become a must-have bit of tech. We traced this lack of awareness back to most potential owners not having all the connected features demonstrated to them in the showroom or on a test drive. Almost three quarters of European owners couldnt remember having the features demonstrated, and over two thirds of North American owners had the same experience. Only in China was there more demonstration, but even there it was remembered by barely more than half of the owners we spoke to.2Show and tellExplanation and demonstration of connected features at the dealership are more frequent compared to two years ago. Encouraging drivers to use connected features seems easier now, probably because awareness of them is greater. On average, the level of awareness of connected capability increased in Europe and the U.S. by around 10% to 15% points in just two years. And on average, two out of three drivers are now aware their car is a connected one. The big question therefore being, are these demonstrations made at a moment of truth? The moment that can really make people eager to try and experience and enjoy the benefits that will make their drive safer and more comfortable. The purchase journey, from first contact with the car to the delivery are full of moments. Not all of them being appropriate to get to know about the connected features. A thorough understanding of these moments of truth would reveal the ones that will really impact from those that will do less.2019 updateEXPLANATION AND DEMONSTRATION OF CONNECTED FEATURES AT THE DEALERSHIP62% -2% China% connection features explainedEvolution from 2017+13% 54% U.S.+7% 57% Nordics+11% 46% Germany+11% 54% U.K.+6% 54% France+12% 65% Spain8 911Connected Car 2019We found that once drivers understood the benefit of connectivity it became an essential part of their driving routine. And because they dont want to re-learn different systems in other brands, it kept them loyal to the manufacturer they were familiar with. And more than that, its an incremental revenue opportunity as they were happy to keep paying if the service was subscription based.3When users get it, they want to keep getting it2017 insightAbout three quarters of connected car drivers now use at least one of the features available. That is a moderate growth compared to 2017, but its also worth noting that in Spain, the U.K. and Germany, the increase in users is significantly higher than the other markets surveyed.Feature renewal also correlates strongly with feature use. Once someone starts to use a feature, theres a probability between 60 and 85% that they will keep on using it - any future car purchase they make, they will want to have the feature again, depending a bit on the type of connectivity feature.However, China and Spain are still the countries with the most frequent use of connected features. This comes as little surprise in China where people are generally quick adopters of new technology, making them much more open to test and use in-car connected devices. Among the different categories, connection to Wifi, Bluetooth, USB and smartphone are the most used features, apart from ubiquitous navigation apps.Security features that protect the car against theft, infotainment and convenience (like voice control and remote air conditioning) are used more in China than in any other market. That resonates completely with the higher dependence Chinese consumers have with mobile technology and the various apps they use in their daily life.2019 updateCATEGORIES BEING USED6150Connectivity5640Navigation4530Driving style4523Security4028Maintenance3923Safety 3922Convenience4118Infotainment2614Other Showing lowest measured % vs highest1013Connected Car 20192017 insightAuto brands scored much higher levels of trust than major tech giants in our study. Given the amount of data a connected car records and transmits, not to mention the financial details the OEM stores if a subscription is part of the connectivity package, its encouraging news. Indeed, robust data protection has a halo effect across all aspects of a car brands activity. By association, any company that emphasises a strict data policy is likely to see trust scores improve in every part of its business.4Tried and trustedThe idea that people put more trust in car brands than any of the big tech companies is reinforced in 2019 with the evolution of technology (e.g. 5G). That said, does a car storing private and behavioral data also becomes a target for hackers? OEMs may be able to use security of data as a unique selling point, but this will only work if they can rely on suppliers of products and services dealing with this accurately. Results from the U.S., Germany and France in particular, demonstrate that manufacturers have a significant reputational lead over technology companies in the area of securing information and keeping private data safe. Automotive brands need to develop strategies to benefit from this leadership position.In China, where the trust is more balanced between car brands and tech companies, we do not observe the same trend. This might be because Chinese consumers are experiencing the growth of auto and tech brands at the same rate. In more mature markets, tech companies, compared to the auto industry are newcomers who have yet to prove their security status and face frequent scrutiny from the media.2019 updateE.g. For France, it means that more than 3x as many people lean towards car brands than toward tech giants. Whereas 0,8 for China means that about the same proportion of people lean toward car brands as they do tech giants.Germany5.3 x U.S.3.4 xFrance3.3 xNordics2.4 xU.K.1.8 xSpain1.2 xChina0.8 xTRUST IN CAR BRAND: RATIO OF PEOPLE LEANING TOWARD CAR BRAND OVER TECH GIANT1215Connected Car 2019ConclusionBack in 2017, we concluded that auto brands have an opportunity to grow their market share and create clear differentiation by aligning connected car services with the real-world lives of its customers. Connectivity is complicated: its success depends on awareness, clarity, fluidity and intuitivity of usage.Our original 2017 study remains a rich source of information about where opportunities exist to fix the broken links between auto brands tech genius and car buyers real-world lives. It also examines how thriving economies like China are capitalising on a different buyer mind-set and level of market maturity. The updated 2019 version identifies opportunities that still exist, where positive change is happening and just as importantly, where it is not. Connected features are becoming powerful brand loyalty retention assets, while subscription-based features promise sustainable, incremental revenue. But perhaps the most intriguing insight is how features made popular over the past 10 years by the worlds tech giants, e.g. voice assistants and app user interfaces, are now desirable additions to the driving experience.Intriguing, because those same technology companies are trusted less than ever before to keep their customers private data safe compared to the car brands now offering similar on-the-go information, entertainment and lifestyle services. Out-of-this-world features still need to be grounded in the real world1417Connected Car 2019 Connectivity still lacking real-world relevance for many Awareness of connectivity is showing a healthy rise, particularly in Europe and the U.S. Willingness to purchase a connected car is increasing Demonstration of connected features at the point of purchase is increasing Usage of connected car features is growing, particularly in Spain, Germany and the U.K., with China still leading the way Voice activation is a desirable feature People put more trust in car brands than tech companies, when it comes to handling private dataWe wanted to revisit the original study two years on to discover if car manufacturers (OEMs) had made progress and leveraged the opportunities for growth identified. Our new study provides a rich source of information about the opportunities to engage drivers and how best to leverage them. Connected car: new study, new opportunitiesBackground on study: Fieldwork was conducted in June 2019, consisting of online interviews with 4,500 connected car owners, 500 in each of the following markets: the U.S., UK, China, Germany, France, Spain, Sweden, Norway and Denmark. This study looks at fewer markets and has smaller samples compared to the one conducted in 2017 (8,500 connected car owners across 13 markets).To find out more by market, get in touch with our Automotive experts: connectedcarskantarKey insights and opportunities to consider:16