Telematics: Getting Consumers Globally Connected
All you need is Internet access, and a telematics program can transform your shop into a profit center.
As vehicle electronics continue to multiply and become more integrated within the automobile, the entire aftermarket channel has had to adapt in repairing these on-vehicle electronics, whether by a gung-ho attitude and acceptance, or by initial reluctance and in some cases, force. Those who don't could get left behind.
And just as we got up to speed on the latest in servicing planar technology, i.e., Mode $06, CAN, GDI, turbine fuel pumps, EUI, swash plate variables, hybrid batteries, drowsy driver alert sensors, E/V charging couplers, HEV, common rail and the other 250-plus computer-driven modules embedded into every car... boom ... enter telematics.
Yes, telematics. It's only a natural progression that the automotive industry would develop services that work in conjunction with those electronics to provide the consumer a more enjoyable, safer driving experience. These services, in turn, can create business opportunities for OEMs, suppliers and service repair shops alike.
It is predicted aftermarket telematics could be worth $1 billion by 2014. It's also forecasted that 50 billion machine-to-machine communication devices, such as cell phones, laptops, washing machines and even utility companies, will be globally connected by 2020. The reality is telematics has been around for more than 20 years with GM OnStar, Ford Sync, Mercedes-Benz mBrace and Lexus Enform, to name a few, and with insurance companies such as Progressive, AAA and State Farm. All are using telematics in some form or fashion. And not only with consumers, but also on fleet vehicles, car rentals and even heavy-duty commercial vehicles.
But What is It?
Telematics, in the simplest of terms, is an enabling technology, a machine-to-machine communication tool allowing companies to talk with their customers and vice versa through a device installed on the customer's vehicle. This two-way communication, coupled with vehicle data delivered from the device, allows repair shops, for example, to assist their customers with a variety of services, such as remote vehicle diagnostics, roadside assistance, service maintenance reminders, vehicle health monitoring and incident management. Telematics connects repair shops to their customers, increasing business loyalty and fostering long-term relationships, all while increasing shop profitability.
Telematics goes by many names and features a variety of functionalities, but the principal concept remains the same: create a valuable connection for consumers through their vehicle for a better driving experience.
And yet, many aftermarket professionals still have a difficult time determining how telematics can work for them. This is particularly true for repair shop owners. It's a mystery; a conceptual business model versus a real life business opportunity. The truth is, however, telematics is a reality of today. And it could represent growth and profitability for the aftermarket repair shop owner.
So Who Wants It?
A recent survey shows 60 percent of connected consumers with mobile-to-mobile communications consider on-vehicle diagnostics important. And with the proliferation of smart phones, predicted to hit 500 million by 2015, consumers are "electronically open" to embracing telematics for additional driver peace of mind.
Creating a connection with their local repair shop and having a telematics device installed on their car, consumers can receive time-to-service alerts on their phone or when they should schedule an appointment for routine service maintenance. Telematics can help take the unpredictability out of car maintenance for drivers and allows the repair shop to build lasting relationships with their customers.
However, the question of privacy continues to remain one of the primary concerns when discussing telematics devices with consumers. Drivers can rest easy though, knowing they will maintain the ability to control their aftermarket telematics device - on or off - as well as the company they choose to partner with for their telematics program. Recent research also reveals consumers do want their telematics provider knowing where they are ... especially when they need roadside assistance.
Where We Are Today
Currently, repair shop telematics are still in a development phase. This is primarily due to channel partner integration, which would make up an operational telematics business model. What does this mean? The distributor, repair shops, air carriers, service providers and technology enablers, all must work together to offer this services-based program to consumers.
OEMs and their dealerships are leveraging their on-vehicle telematics to capture consumers after the warranty period has ended. Today that provides them an advantage, although it is limited in scope. Currently, the dealer can only offer one choice - one OEM, one telematics "style." Aftermarket telematics provides choice to the consumer regardless of vehicle make or model.
What You'll Need and What to Look For
Picture this. Your customer is headed to a picnic. Through telematics, you have been monitoring her vehicle's battery life. It's been declining. Alerting her by text, you schedule an appointment to have her car in for service. That's right ... You know what's wrong before the customer realizes there may be a problem or before the car even gets to the shop. In the simplest form, that's how telematics works.
And the best news for repair shop owners, regardless of size, is all you need is Internet access to get started with your aftermarket telematics program. Yep, you heard right - you only need Internet access.
So, you have Internet access, but what would the telematics supplier provide you? As aftermarket telematics begins to develop and companies begin to position themselves as a telematics solution, it's important to understand what each telematics provider offers. Some will be able to deliver a complete solution. Some companies may only provide one facet of telematics, such as the hardware or hosting capabilities or call center or data mining.
For a total solutions telematics provider, dependent on your shop growth strategy and/or program requirements, it may be as simple as the supplier providing the device for purchase or lease. Or it could be a more comprehensive program using:
1. Hardware: The actual telematics device. This device is located on the vehicle, which then transmits global positioning system (GPS) data, cellular information and vehicle data back to the data server for collection.
2. Customers/Vehicle data: Based on features selected, vehicle data could mean speed and location or vehicle diagnostics data, which is then transmitted wirelessly from the telematics device to the data server for collection.
3. Data server: Collects, stores and analyzes data transmitted from the onboard telematics device. Also known as hosted services or backend support.
4. Web portal and/or smart phone access: User interface to visually "see" and manage the telematics device and subsequent data collected.
5. Applications: Software application that transforms raw data into useful functionalities and features for repair shops, technicians, shop owners and consumers.
6. Call Center: Communication hub for repair shops and consumers to interface.
7. Air Plans: Like your cell phone, air plans are the costs associated with wireless connectivity for the telematics device and data servers.
So there you have it ... aftermarket telematics simplified. It's a lot to absorb and you're interested in learning more, but what are your next steps? How do you stay up to date on the latest happening with aftermarket telematics? Bottom line: Ask questions.
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