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The future of the auto service experience

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This is an initial view that brings together a number of different perspectives on the future of car servicing being driven by potential changes within the sector, in adjacent arenas and beyond. Having gained some feedback and opinion from around the world on which of these shifts will have greatest impact, which will happen first and what is missing from this view we have added in some potential future scenarios for how the future shifts could change customer experiences and business models for dealers and workshops. Further comments on these thoughts are welcome and will be shared in a few weeks time As with all futureagenda projects, the outputs will be openly shared for all to use as sources of insight and stimulus for innovation, strategy challenge and wider engagement.

Text of The future of the auto service experience

  • The Future of The Auto Service Experience 28 O ct 2013 | Tim Jones | Charlie Curson
  • Ini:al Views Sector Feedback Poten:al Scenarios Overview This presenta:on shares some views on trends that could impact auto servicing over the next few years. It includes trends, feedback from across the sector and some poten:al scenarios for the future
  • Ini7al Views
  • Sector ShiOs Adjacent Changes Macro Trends Star7ng Point An ini:al view brought together a number of dierent perspec:ves on the future of auto-servicing being driven by poten:al changes within the sector, in adjacent arenas and beyond. This follows.
  • Shi>s Within The Automo7ve Industry
  • Intelligent Highways Mesh networks and ubiquitous mobile connec:ons deliver automated highways to improve safety, increase capacity and reduce conges:on
  • Autonomous Vehicles Led by urban delivery pods and long distance trucks, the rise of automa:cally driven vehicles leads to the reinven:on of the travel experience around infotainment
  • Digital Showrooms Vehicle selec:on and purchase takes place on the high street and in shopping malls with immersive digital experience replacing edge of town physical car dealerships
  • Smart Cars Every vehicle has thousands of sensor-connected computers that collec:ve provide the intelligent car able to monitor itself, its environment and its passengers
  • Declining Cost of Ownership Increased compe::on, system eciency and more open pricing leads to a net decline in the ongoing cost of ownership of a vehicle aOer purchase
  • Inclusive Service Plans Customers increasingly have their rst three years servicing included within as a xed price the purchase or lease cost of their vehicle as long as this takes place at a dealer
  • Smaller Cars More crowded urban environments and the drive for beVer fuel economy reverse the trend for larger cars and, especially for the young and old, smaller is beVer
  • Pervasive Leasing Driven by a combina:on of sustainability, business model and convenience factors, leasing becomes the predominant mode of new vehicle access for all
  • Declining DIY Greater product complexity and more sophis:cated diagnos:c equipment makes customer do it yourself servicing almost impossible for new cars
  • Electric Car Services The growth in electric vehicles brings with it the advent of a completely new service experience with clean environments, super fast diagnosis and plug and play component swap
  • Convenient Fast Fit Na:onal fast-t tyre, service and retail chains extend their drive in service support for low complexity, high volume wear items and maintenance ac:vi:es
  • Every Car is A Node in the Network With the introduc:on of embedded SIM cards in every new vehicle, all cars are tracked and the advent of the connected car experience is accelerated
  • Late Customiza7on Wider personaliza:on of vehicles is enabled by the shiO of op:on-t from manufacturer to dealer and opens the doors to new owner makeovers when cars are resold second hand
  • Mobile Servicing Signicant growth occurs in at-home or at-work low complexity servicing from mobile technicians provided via roadside assist companies, independents and dealer networks alike
  • 20,000 Mile Service Intervals All new cars can go for 20,000 miles or two years between services due to universally adopted long-life products, ubiquitous diagnos:cs and greater overall vehicle reliability
  • Predic7ve Remote Maintenance F1 and satellite technology is applied at scale enabling car manufacturers to con:nuously monitor vehicles, diagnose any future faults in advance and remotely update soOware
  • Drive Thru Servicing With pre-arrival diagnosis the norm, drivers opt to take their vehicles to loca:ons able to do a full service in 30 minutes while they have a coee, relax and browse the net
  • Uninformed Customers As eciency improves and automa:on grows, drivers are ignorant of how vehicles work and, especially in fast growing economies, unaware of anything under the bonnet
  • Adjacent Sector Changes That Could Have Impact
  • Dynamic Pricing Real-:me consump:on paVerns and data seamlessly drive the marginal value of products, the cost of access for adver:sing and the underlying cost to produce
  • Personalized Localized Informa:on is con:nuously updated to reect current need states and interests of the individual and provided for seamless cross-pla`orm consump:on
  • Retail Showrooms Physical retail outlets diverge in ac:vity between tradi:onal stores and showrooms where we browse and research ahead of online purchase and at-home delivery
  • Perfectly Informed Consumers BeVer informa:on of cost, quality, benet and availability enables consumers to set the right price for products and services and buyers pay sellers what they want
  • Everything Niche Niche becomes the mainstream as the cost to connect those with common interests drops to zero and more of us can pay aVen:on to specialist, tailored long-tail needs and wants
  • Transparent Pricing Consumers, supply chains and regulators share informa:on openly and force manufacturers and retailers to be more transparent about costs and accountable for errors
  • Less Variety The future is one of reduced choice but not less interest as bricks and mortar retailers provide an increasingly edited por`olio of products through ever more ecient channels
  • Small and Distributed Local at home produc:on matches consump:on with 3D and digital scanning and prin:ng providing highly ecient and good quality instant physical outputs
  • Bridging The Last Mile The need to make public transport as exible as private focuses aVen:on on the rst or last mile between mul:-modal hubs and the home / work des:na:on
  • Access Not Ownership Rising sustainability impera:ves and increasing cost of ownership all shiO the balance from ownership to access and we prefer to rent than buy
  • Redening Value Consumers want to par:cipate in value crea:on, shiOing the mindset to made with me - Value is about shared with me as the ownerless economy expands
  • Openly Shared Insight Knowledge is nothing if not freely shared as value crea:on shiOs from insight ownership to insight use and applica:on while branded and local sources of content compete to share
  • Mass Customiza7on Consumers expecta:ons of unique and bespoke are met through the apparent delivery of individual combina:ons drawn from choreographed choice architectures
  • Macro Trends Impac7ng Many Sectors
  • Ubiquitous Data Access We will nally be connected everywhere - everything that can benet from a network connec:on will have one and everyone will have access to the mobile internet
  • Con7nuously Earned Trust Inherited and historical status of brands and icons is subsumed into a world where trust goes to the most credible source in the moment and many ght for authen:city
  • Ci7es Not Countries Ci:es are more important than countries and increasingly set the standards as cultural connec:ons predominate over na:onal iden::es and urban markets group around common issues
  • Internet of Things Every device and consumable product has an integrated unique IP address that enables everything to become an ac:ve node in the shared network
  • Peer to Peer Networks Recommenda:on and advice shiOs from experts to the crowd as peer to peer networks dominate in an era of shiOing trust and declining respect for ins:tu:ons
  • Adapta7on to Climate Change As the :me to impact of renewable alterna:ves becomes clear, the world recognizes a period of increased planetary stress and we seek to beVer adapt to more extreme weather paVerns
  • Almost Zero Waste Escala:ng waste produc:on, changing aftudes to resources alongside new approaches, regula:on and business models lead many to aim for the almost zero waste society
  • Dense Ci7es As urban migra:on increases, ecient, densely populated ci:es, not distributed op:ons, are the blueprints for more sustainable places to live
  • All Digi7zed By 2020 all the worlds informa:on is digi:zed, storage is nearly free and the volume of data in the world is doubling monthly we can all access the 21st century archive
  • Sector Feedback
  • Gaining Feedback We shared the ini:al views on emerging trends for feedback from around the world on which may have greatest impact , which could happen rst and why.
  • Trends most likely to happen 1. Predic:ve Remote Maintenance 2. Uninformed Customers 3. 20,000 Mile Service Intervals 4. Declining Cost of Ownership 5. Access Not Ownership 6. Transparent Pricing 7. Mobile Servicing 8. Smart Cars 9. Retail Showrooms 10. Autonomous Vehicles Those that may have greatest impact 1. Transparent Pricing 2. Predic:ve Remote Maintenance 3. Mobile Servicing 4. Retail Showrooms 5. Digital Showrooms 6. Uninformed Customers 7. Access Not Ownership 8. Pervasive Leasing 9. Electric Car Services 10. Inclusive Service Plans Wider Views Feedback from car manufacturers, dealerships and industry commentators helped to priori:ze the trends that are seen to be most likely to happen rst and those that could have greatest impact
  • Poten7al Scenarios
  • 2020 - A World With: Smart cars Everything digi:zed Electric car services Inclusive costs Predic:ve remote maintenance Pervasive Leasing Transparent pricing Uninformed Customers Smaller cars 20,000 mile services The 2020 Perspec7ve From the feedback, it is clear that, sooner or later, most agree that technology will have a major impact on the service experience in providing a more connected, ecient and simplied landscape
  • Small and Distributed Large and Concentrated But, there seems to be two dis:nct ways in which the future experience can be delivered that have dierent implica:ons for customers and impacts for the auto-service providers
  • Small and Distributed Large and Concentrated Customer Experience: Local and personal Mobile servicing Workshop Impact: More exible approach Less frequent foo`all Fast t whenever possible Cross-brand support Convenient loca:ons Just-in-:me stock access Mul:-skilled but fewer sta Decoupled from retail Value-based pricing Best price parts and labor Small and Distributed In the Small and Distributed scenario, we can see a world in which customers vehicles are maintained away from the retail space where and when they wish with maximum convenience and minimum hassle
  • Large and Concentrated Customer Experience: Immersive centers Drive thru op:ons Workshop Impact: Infotainment experiences Fast priority lanes Digital showrooms Mul:-brand access City-center / mall loca:ons Smaller forecourts Mul:-brand rela:onships Integrated with other retail Compe::ve pricing Best price parts and labor Large and Concentrated In the Large and Concentrated scenario, we can see a world in which customers vehicles are maintained away from the retail space where and when they wish with maximum convenience and minimum hassle
  • With all the data openly available, how quickly can the customer experience be reinvented? What new approaches can be adopted to unlock new sources of value and dieren:a:on? How will margins be impacted by more transparent pricing and greater eciency? Will the control balance between manufacturers, dealers and workshops have to change? What can be learnt from other sectors that have gone through similar and rapid shiOs? Five Ques7ons For the sector, these both raise a number of key ques:ons for the future primarily around the speed of change but also impac:ng issues such as control, protability and business models
  • The worlds leading open foresight program Future Agenda 84 Brook Street London W1K 5EH +44 203 0088 141 :[email protected]