For most of its history, the automotive industry has been about bending metal. Today, however, the changes have been bending minds, as the vehicle has become practically a computer on wheels—hence the expressions “software-defined vehicle” and “connected vehicle.” Increasingly, the consumer experience is being shaped digitally, driven by data and technology. Automotive News Canada asked two of Salesforce Canada’s thought leaders in the connected-car sphere — Rory Macleod, Area Vice-President of Sales, Manufacturing, Automotive and Energy; and Achyut Jajoo, Senior Vice-President and General Manager, Manufacturing and Automotive — to help demystify the emerging era of the software-defined vehicle and to explain the challenges — and detail the opportunities — that await auto companies.
Expert Insights: The Future of Connected Vehicles and Customer Experiences
Q: Over the past several years, the term “software-defined vehicle” has emerged. What does this term mean and why is it important to the consumer?
Achyut Jajoo: For more than a century, cars have been a symbol of engineering prowess because of their hardware: engines, transmissions, brakes, axles and other physical parts. When we talk about how we’ve now entered the era of the software-defined vehicle, what we mean is it is now software, not hardware, that is shaping the driving experience. The underlying architecture of what makes a car a car is being fundamentally rewritten.
Rory Macleod: Once all cars — electric, hybrid or gas — are more software-defined and connected, the capabilities and possibilities for more enjoyable, safe and sustainable driving experiences will grow exponentially. The software-defined vehicle will connect more than just cars but also drivers, manufacturers, dealers and auto lenders in ways that create more personalized experiences and higher levels of customer service
Q: Can you provide an example of current connected-vehicle solutions or features?
Jajoo: Some cars, especially more tech-forward EVs, are a harbinger of what software-defined vehicles will look like in the future. Cars that park themselves, offer guidance to the nearest gas or charging station, signal needed repairs or pull up a child’s favorite shows are all great examples. What’s really exciting, though, is that in the near future, these won’t be nice-to-have, premium features; they’ll come standard on every vehicle.
Q: What types of experiences are on the horizon that will be supported through connected or software-defined vehicles?
Macleod: As digitally fueled car sales increase, vehicles are also becoming more connected. By the end of the decade, it is estimated that connected cars — cars that can communicate and share data with a variety of systems both inside and outside the vehicle — will make up about 95% of all new vehicles sold around the world.
Layering web-based and location-based data, for example, a car will be able to alert a hungry driver that a favorite fast-food dining spot is coming up in a few miles. From the car, the driver can instantly place an order via a voice-enabled chatbot and even utilize a special coupon generated on the fly for the driver.
Jajoo: On the commercial side, vehicles will serve as platforms for advanced fleet management and telematics solutions. With route optimization, real-time planning, remote diagnostics, predictive maintenance and driver performance monitoring, businesses will be able to minimize driver downtime and further optimize fleet operations.
Another common situation where connected cars will be helpful is with fender-benders. In a software-defined vehicle, camera recognition technology will confirm everyone is OK and doesn’t require medical assistance. Then, a workflow can automatically kick off — alerting the insurance carrier, proactively calling a tow truck and initiating the claims process, all automatically and in real time.
Q: How will in-vehicle transactions evolve and who will be driving innovation?
Jajoo: By bringing together car and driver data, automakers will be able to orchestrate consumer experiences across marketing, sales, commerce and service — at scale — and push them right into a car’s infotainment system. And this is why technology like Salesforce’s Automotive Cloud is so important. With Automotive Cloud, automakers can unify all of their customer and vehicle data across all channels and interactions — such as customer inquiries, service requests and vehicle data — into a single, real-time profile for every customer that gives them the foundation they need to bring these next-generation, in-car experiences.
With Automotive Cloud, automakers can do things like help drive adoption of their software subscription services by creating a personalized, automated flow that can offer a customer a trial of the automaker’s new park-assist feature before the customer attempts to park the car, enabling automakers to target the right customer at the right time.
And with increased connectivity, we will see an explosion in the types of in-car services and transactions that can be enabled by technology. You will be able to use your card as a mobile wallet to purchase gas or to recharge your vehicle. And beyond just new subscription services, automakers will be able to do things like offer on-demand vehicle upgrades right through the driver’s console.
As the industry continues to accelerate into the digital world, we will see more partnerships with technology companies like Salesforce, as well as other industries like fintech that can enable in-car purchases, to drive continued innovation.
Q: How can the emergence of connected-vehicle technology increase customer lifetime value?
Macleod: The automotive industry is facing a new digital imperative amidst massive upheaval brought on by the rise of direct-to-consumer models and the dawn of the electric-vehicle age. But with great disruption comes great opportunity, and companies accelerating into the digital-first future with technology like Automotive Cloud can gain a competitive edge while simultaneously future-proofing their businesses.
With connected vehicles, OEMs now have the opportunity to engage with their customer on a daily basis, and the only way to engage and delight customers at scale is with automation. It’s clear how this can help increase the customer lifetime value, but what about the vehicle’s lifetime value? OEMs and dealers don’t know and can’t interact with the second or third owner of a vehicle or other drivers within the same household. With connected vehicles, they now have the opportunity to create relationships via the connection to the vehicle’s telematics and improve the customer experience. Think about all the added complexity to the industry with the increasing number of first owners and now subsequent owners.
Q: How do connected cars change a consumer’s ability to customize a vehicle, and how will the consumer’s experience with owning and operating a vehicle change as connected cars become the norm?
Jajoo: Connected cars will supercharge vehicle customization, not just during the buying process but throughout the entire lifetime of the vehicle.
For one, cars will no longer be limited to the features and upgrades selected at a dealership. Cars and trucks will be dynamic, instantly upgradable machines thanks to the software, connectivity and volumes of telemetry data that a car generates. In real time, the data coming from the car can help shape the features and change the way you’re experiencing the car itself. Your car will become as personalized and integrated into your daily life as your iPhone is today.
Let’s say you’ve started out on a road trip, but you don’t have a trip optimization service installed on your vehicle. To help, your automaker can see this and immediately send a notification through your car’s infotainment system to install the service — which can point you to the best rest stops, find the best places for you to recharge or refuel at the lowest cost, and other features that will make your trip easier and more enjoyable. You’ll even be able to do things like upgrade your vehicle’s horsepower on demand.
Q: Connected cars generate a tremendous amount of owner-specific data. Does this data need to be protected, and is there an impending struggle over who can use this data and for what purposes? And who ultimately owns the data?
Jajoo: Connected cars will be computers on wheels, generating an estimated 100 petabytes of data per month, per vehicle; and it is imperative that automotive companies make sure they are taking a values-led approach to their customer data. While customer data is an essential part of delivering personalized experiences, consumers need to trust that if they hand their data over, it will be safe, used legitimately and benefit them as well. This is exactly why at Salesforce we always ensure we manage first-party data in a trusted way, with privacy, security and compliance built right into our products.
Macleod: To take a step back, in the past, automakers would buy data from external agencies to try to better understand their customers. But today, they have a wealth of data being generated that they can harness to deliver better customer experiences at every interaction. This data isn’t just coming from connected cars but from things like website interaction as well. With Automotive Cloud, automakers can capture and harness all of this data not just to drive better decision-making but to deliver personalized experiences for their customers in the car, at the dealership, at the service center and online.
Q: In terms of importance, how will connected-car capabilities and experiences compare to a consumer’s traditional motivating purchase criteria, such as style, performance, safety, aspiration and utility?
Macleod: With a true connected car, things like vehicle performance, utility and safety will still be important, but they will come to be defined by software. You’ll even be able to do things like boost your car’s horsepower with an over-the-air update or make your EV growl like a muscle car with a sound-effect add-on. We will see connected-car features become more and more important for consumers and emerge as the key differentiators for automakers looking to stand out in an increasingly competitive industry where electric vehicles are standardizing performance.
ABOUT THE PANELISTS
Area Vice-President, Sales, Manufacturing, Automotive and Energy
Macleod has over 25 years of experience leading digital transformation initiatives with C-suite stakeholders and currently leads Salesforce’s national industry organization in Canada focused on manufacturing, auto, energy and utilities.
Senior Vice-President and General Manager, Manufacturing and Automotive
Jajoo has more than 20 years of software industry experience related to manufacturing —discrete, process, automotive and energy — with a focus on bringing to market innovative products and solutions with global impact. He offers a track record of general management, product development, product marketing and collaboration to produce excellent products and achieve customer satisfaction while meeting and exceeding P&L goals.