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Phygital in Automotive: Bridging the Gap Between Physical and Digital – Part 2

 
 

Mobility | Tony Whitehorn |
11 May 2021

In part 1 of this article, we discussed how Phygital has become part of the automotive dictionary, as the value of combining physical and digital retail experiences has become clear. We also considered the opportunities it presents to automotive businesses during the presale and sale stages of the customer journey. Now, we will look at the post-sale stage with an intriguing case study and some final top tips.

OPPORTUNITIES FOR POST-SALE SYNERGY & A GREAT CASE STUDY

The industry has historically focused on developing a prospect into a customer, but this has now progressed to making that customer a long-term client, recognising that this is the key to business success. OEMs are shifting their strongly physically oriented offering towards a more balanced business that combines physical products and digital services. This requires a good CRM system but also a digital solution that can continuously engage the customer with the car, the dealer, and the brand.

Dealers, OEMs, and other industry businesses have been searching for a digital solution which engages the customer and works alongside the enjoyable experience they receive from the physical car. One such solution is being developed by Endava with a couple of manufacturers and is called a Personal Digital Car Assistant.

Personal Digital Car Assistant (PDCA) 

Usually, the manual that is found in the glove compartment of any car is used by the owners as a pure reference document. They will refer to it when a warning light suddenly flashes, or when they need to replenish the screen wash or engine oil. However, the manual is cumbersome, difficult to navigate, often too generic, and not specific to the car’s trim level, and therefore frustrates the owner. OEMs are now looking to digitalise the manual (accepting that some pages need to remain physical), which is also an opportunity to digitalise the customer relationship.

The PDCA is an app with integrated Artificial Intelligence (AI) and bot technology that may appear to be a digital manual for the car, but it can engender significant engagement for the customer. Imagine having ordered the car and receiving a PDCA app specific to your car prior to delivery. This app will enable you to interact with the car dealer and request real-time order status and ETA updates. No more having to contact the dealer for an update on your order – instead, there could be videos of the factory in which your car is being built and photos of the dockside and the ship transporting it. This will completely engage the customer and remove the angst felt by sales staff having to provide an order status to an expectant customer.

The PDCA will also become embedded in the customer’s psyche, as it becomes the go-to “concierge” for all things related to the car. During that time between order and delivery, the customer will want to learn more about all car functions and features, receive information about the ordered car, pre-configure car settings and the navigation system.

In addition, very specific sales “add-on” opportunities arise, particularly service plans, accessories, protection products, and insurance. The app also removes these aspects from the original order conversation when the sales staff are nervous about additional costs jeopardising the car sale.

Besides containing all the information about that specific car, the PDCA is voice-activated, driven by AI, and more than a digital manual. Once the car is handed over, it also becomes an integral part of the relationship between the customer and the car itself.

Because it provides updates about the car’s ETA before it arrives at the dealership, raising the anticipation of the expectant customer, that customer develops an affinity with the PDCA. Once the car is handed over, the app could integrate with other systems, including geolocation and vehicle telematics, further enhancing the customer interaction. Imagine the tyre pressure monitoring system identifying low pressure in a tyre, and the PDCA informing the customer of the correct tyre pressure and where the nearest forecourt with a tyre inflator is situated.

Having AI and Machine Learning (ML) capabilities allows for great data generation, which can be harvested by OEMs to further improve the relationship with customers moving forward. However, it is vital that this data is not only collected and stored but used in the most efficient way. Too often the focus of the output is the amount of data generated, rather than the effective and efficient use of it to benefit the customer.

The PDCA is a great opportunity to really engage the customer on an ongoing basis and to bridge that physical-digital gap. It is dynamic and responsive and enables the customer to build a digital relationship that complements the physical enjoyment of owning and driving a car. This is a great example of Phygital in action.

TOP TIPS TO ADOPT PHYGITAL

So, this sounds great! But is it a reality? The answer is “yes”, but the true question should be: “Where on earth should OEMs start to achieve that?” Here are some top tips to whet your appetite and kick-start some action:

  • Engage with your customers and prospects to identify how they want to research and buy a car, and then map your physical and digital touchpoints accordingly.
  • Consider introducing virtual showrooms or virtual auto shows to emotionally engage potential customers with your dealership(s) even before they physically enter.
  • Think about introducing more sophisticated levels of digitalisation like VR/AR or gamification to encourage potential customers to stay longer on your digital site.
  • Realise that price transparency is coming – no more haggling – and prepare for “click to buy”.
  • Look at introducing a PDCA into your brand to develop that ongoing digital relationship.
  • Ask yourself how the data you are generating is going to be used to benefit the customer. Implementing a standardised, holistic data strategy is vital to generate more sales through digital services and increased customer loyalty.
  • Review your legacy systems and identify the pain points which are stopping you from introducing any of the above initiatives.

Covid-19 did not initiate the digital revolution; it merely made customers realise that digitalisation is not just a reality but rather a necessity. All OEMs need to grasp elements of the above – not to get ahead of the competition but to satisfy what customers have come to expect from other retail relationships. OEMs must stop looking at software and IT organisations with fear of them entering the market but rather embrace them as partners to realise the dynamic digital changes required to satisfy the ever-changing customer requirements.

Tony Whitehorn

Consultant

Tony has worked in the automotive industry for more than 35 years, holding senior positions with Renault, Toyota and Hyundai. He is passionate about helping businesses succeed through collaboration, embracing change and empowering their people. Tony helps our clients to assess their readiness, navigate the necessary changes and start to build on their vision of this future as it relates to mobility ecosystems. When he isn’t working, he loves playing and watching sport, volunteering with his church and spending time with his family.

 

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