Digital Transformation in Automotive Industry Chinese-German CAR Symposium

Digital transformation in the automotive industry

Chinese-German CAR Symposium

April 26th, 2016

Copyright © 2016 Accenture All rights reserved. 2

China has now the world’s largest netizen population and the largest e-commerce market

Value of China’s online shopping

market at USD 440 billion

440

Online shopping accounts for 10.7% of total consumer

goods sales vs. USA 6.6%

10.7%

Social media app. WeChat has more than 600 million

active users

600

More than 642 million internet users,

the largest netizen population worldwide

642

More than 527 million mobile internet users

527

China’s “Netizens” spend 25.9 hours online every week

25.9

Online market volume in 2014

440

300

52

China USA Germany

Netizen population in 2014

642

280

72

China USA Germany

Unit: million

Unit: billion USD

Source: World Bank, United Nations, U.S. Commerce Department, Ministry of Commerce People’s Republic Of China, National Bureau of Statics of China, CNNIC, Tencent financial report


With a large population of “always on” consumers,the digital eco-system is evolving rapidly in China

Cloud solutions provide alternative service models, e.g. platforms and applications as a service, enabling new levels of scalability, flexibility and responsiveness

Social media and collaboration technologies in Marketing, CRM or Sales systems enable relationship building within and beyond the organization.In China there are many social media channels for different markets (e.g. food, travel, business, music)

Analytics/ Big Data How insight

is created

CloudHow things

are delivered

SocialHow things

are discoveredVehicle on Cloud enables OEMs to set up an automotive ecosystem at lower cost of ownership

Analytics within the application architecture enable generation of new insights and information, support of public opinion monitoring and service optimization

Smart devices, innovative apps and 3G/4G mobile Internet provide flexibility to shop, read and chat anywhere at any time

MobilityHow things

are consumedTelematics play a vital role in connected vehicle services and enable bi-directional communication between customers and OEMs

DIGITAL BUSINESS


Innovative digital players are reshaping customer experience and redefining business models

Digital Behaviors New Business Models Derived newer business models


Digitization is drastically redefining customer experience management in all key dimensions

1

5

3

6

4

Provide personalized content based on previous purchased

data

Customer experience,Digital performance optimization

Convert “Branding” to Sales (Social identity, authority authorized, group

purchase)

MarketingplatformListen and understand

“online / offline consumers”

Executive insights,predictive analyticsVender and dealer

2

Capability

CRM – Big Data

Awareness

Browse

Visualization

AdvocateTrust

Purchase

Anonymous

Broadcast

Initiative

Pause

Measurements

Position

Digital marketing,(SEO/ SEM/ Web pages), social ads and community

Integration,development,

innovation

Acquisition

Engagement

Sales

Post-Sales

Commitment

http://www.google.it/url?sa=i&rct=j&q=youku+logo&source=images&cd=&cad=rja&docid=p_cWogGz78BeJM&tbnid=nGCqozSXYedisM:&ved=0CAUQjRw&url=http://www.rologo.com/youku-logo-renew.html&ei=s6zkUZHoFILBlQWHvYDoCA&psig=AFQjCNECFWegpvDVvMOFaAz1KJKvQslvZg&ust=1374027311680680




Changing consumer behavior and competitive dynamics pose both challenges and opportunities

• User preferences change – customers want digital services

• Data is the future currency – consumer show willingness to share

• Industry boundaries are shifting – service providers establish direct client interaction

• Investment areas: Business Model Innovation and Product Innovation

• The car as "ultimate mobile device" – new players disrupt the market place based on service-oriented and data driven business models


What will be the next-generation car customers look like and what do they want?

That kid – the one in the back of the SUV with the iPad – is the automotive industry’s worst enemy.

(Bloomberg)

“”


Fast development of connected car technology and its new applications have created a new biz platform

1st Generation

2nd Generation

3rd Generation

?

Open Platform USB Jack Multimedia Player

Interface Web browser Wi-Fi Text Reader Third party partnerships

Location-based services Intelligent POI, family

tracking Voice enabled social

networking Real time traffic &

weather On-demand in-vehicle

entertainment Mobile app integration

Future Innovations of Connected Cars Full internet capability On-demand in-vehicle

entertainment Advanced Driver Assistance

Systems Augmented reality

Today…Tomorrow…

Safety & Security Voice Navigation Remote Unlock Concierge Services Vehicle Diagnostic Stolen Vehicle Recovery Bluetooth


Auto companies should consider two strategic dimensions that unlock value via Digitization

Strategic Options1) Business as Usual: Manage risks arising to existing business model(s) from digital activities of competitors2) Partial Digitization: Realize EBITDA opportunities through digitization of existing value chain3) New Business Models: Realize EBITDA opportunities through development of new revenue streams enabled by a new value chain

Value AreasDigital Customer: Apply digital technology to address customers in a more sophisticated way to increase revenues and profitabilityDigital Enterprise: Decrease costs of the existing value chain’s primary functions (e.g. R&D) as well as support functions (e.g. HR)Digital Business: Digitize your current business model or develop new business models generating profits based on digital technology

DigitalEnterprise

Internal Focus

Exte

rnal

Foc

us

Digitize Operations

DigitizeCustomer Experience

Digital Customer

DigitalBusiness

Disrupt (Sub-)Market(s)

Partial Digitization

New Business Models

Business as Usual

1

2

3


Digitization of customer experience in the whole journey of lifecycle management is just taking place

Specific use cases

Physical experience

Targeted research(actual purchase interest)

Consideration

PurchaseConfiguration/price negotiation car & downstream

Waiting phase

Purchase/sale

Hand-over

Use and AfterSales process

Sale/new purchase & FS retention

General info gathering (no immediate purchasing interest)

Awareness...

......

...... NEW

Usage Repurchase

Cross-Market Sales Funnel KPIs

Data Quality Reporting

Customer Service Operational Reporting

Customer Service Agent Performance Reporting

Marketing Campaign Efficiency Reporting

Channel Reporting (Customer Activity)

Lead and Prospect Qualification

Sales Talent Analytics

Customer Service Capacity Planning

Contact Routing Optimization

Statistics about vehicle and driving behavior

Expected Re-Purchase Date

Service Recommendation

Crisis Detection

Social Network Analysis

Segment-based Contact Strategy

Churn Analytics

Test Drive Model Forecast

Configuration Recommendations

Website Personalization

Next Best Offer

Marketing Optimization

1

2

3

4

5

6

7

8

9

10

12

13

14

15

16

1718

11

19

20

21

22

23

Cross- and Up-Sell Analytics

Overall use cases


Integrated content mgmt. and multi-channel mgmt. are key to effective digital sales & digital marketing

WeChat

Mobile APP

Pop-up storelocation

Mul

ti-c

hann

el e

xper

ienc

e in

tera

ctio

n

My CAR

Call Center

E-commerce

Improved sales

3rd party data

Inventory Management.

Task plan

Activities executionConnectivity

Service data

Online behavior

data

3rd party data

Sales data

Online & offline data

integration

Marketing activity

data

Parts data

Data warehouse

Service data

Policy Process Marketingactivities

Sales strategy

CustomerBetter experience

DealerEfficient

operation

OEMFlexible policy


Data becomes ever more powerful only if being connected – data connectivity to be improved

External data Internal data

Available external data

Unionpay payment

data

Website browsing records

WeChat payment

data

Ali-pay payment

dataMobile App

using records

Transportation records

(airline, rail, etc.)

Accommodation records

(hotels booking, etc.)…

Data links:Mobile

phone, MAC address, etc.

DMS

CRM

POS

…


Business model innovation towards a more service-orientation becomes increasingly important

1CAR SHARING SERVICE• Alternative service for private

transportation• A new fashionable lifestyle for

younger generations

2VEHICLE SERVICE• Vehicle related items

incl. parking, fuel charge, repair service etc.

• Exclusive discount or resource availability

3CHARGING SERVICE• Charging facility

location• Charging meter

package and high usage discount

4NEV add-on• NEW add-on mobility service

(combustion engine vehicle rental)• Short term substitution for NEV

with other conventional models

6ONE-APP for CITY LIFE • Everything needed in

your city: travel guide, ATM location or even restaurant tips (covers all daily needs in city life)

5CONNECTED VEHICLE & PERSON• Connected vehicle – OBD,

digital content, CRM etc.• Connected person –

location based service (part of social media)

MOBILITY SERVICE

P


• What will be the future customer needs?• What type of business models can be realized beyond

traditional “hardware” in the context of service transformation?

• What is my partnership strategy to bring together the right set of competencies?

• How to achieve shorter innovation cycles, higher agility?• How to build up the right competencies?

To cope with the challenges, car manufacturers need to address a few key questions proactively


To successfully digitize customer experience, six key areas need to be taken into consideration

Integrated

Journey Design

Personalized Digital

Experience

ContinuousCustomer

Access

DigitalInteraction

Management

SocialEngagement

DigitalIntelligence

16

5 2

34

Ensure a seamless customer journey!

Make it relevant. Make it personal!

Maximize availability and convenience for 24/7-Customers!

Listen, learn and use social media

activities!

Move beyond transactions

to digital relationships!

Digital Business

Define and continuously use

predictive analytics!


A well thought-through digital strategy and organization transformation is needed to win in future game

Digital Trends & Visioning

BusinessModel

CustomerExperience

Digital Enterprise

People & Innovation

• Explore• Educate• Engage

“Engage me with the art of the probable”

• Reinvent my business

• Disrupt or be disrupted

“Disrupt my industry”

• Customer engagement

• Products as Services

“Excite my customers”

• Do more with less

• Increase collaboration

“Redraw my operations”

• Build a Digital culture

• Adopt Digital ways of working

“Build a Digitally native

organisation”

How I can use Digital to…

Motive

17

DisclaimerThis report has been prepared by and is distributed by Accenture. This document is for information purposes. No part of this document may be reproduced in any manner without the written permission of Accenture. While we take precautions to ensure that the source and the information we base our judgments on is reliable, we do not represent that this information is accurate or complete and it should not be relied upon as such. It is provided with the understanding that Accenture is not acting in a fiduciary capacity. Opinions expressed herein are subject to change without notice. It is not intended to provide advice on your specific circumstances.

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Digital Transformation in Automotive Industry Chinese-German CAR Symposium

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Transcript of Digital Transformation in Automotive Industry Chinese-German CAR Symposium