Study shows used connected vehicles can be path to owner loyalty & more
LexisNexis Risk Solutions said automakers might have a great path to stay connected with used-vehicle buyers for a host of potential business opportunities.
LexisNexis Risk Solutions explained that its new study showed U.S. consumers want to hear from their automakers about connected services, safety recalls, warranties, insurance discounts and other benefits.
Insights from more than 2,000 U.S.-based connected vehicle owners highlighted the opportunities for OEMs to further engage with their customers, create new and used-vehicle brand loyalists and realize the return on investment for connected vehicle technology. Those assertions arrived on Tuesday stemming from the study called, “The Driver’s Mindset: Connectivity and Connectedness.”
“Our study shows that automakers are at a confluence. While automakers face increasing competitive pressure to offer the best vehicle ownership experience, and connectivity is mainstream in many aspects of consumers’ lives, there still seems to be lower consumer activation and conversion rates within connectivity programs, despite the benefits,” said Dave Nemtuda, head of OEM product, U.S. connected car, at LexisNexis Risk Solutions.
“The automotive industry can take action on these insights to improve the customer experience, educate consumers on the benefits of connected services and help achieve connectivity-related business objectives,” Nemtuda continued in a news release.
Just because the vehicle isn’t fresh from the factory, LexisNexis Risk Solutions insisted that automakers shouldn’t rule out used-vehicle buyers.
Analysts pointed buyers of new vehicles are twice as likely to be offered a free trial than buyers of used vehicles, even though the technology is available and accessible. LexisNexis Risk Solutions highlighted 83% of used connected car owners — which comprised about a quarter of the survey respondents — remain untapped and serve as potential connected services clients.
Other highlights from the LexisNexis Risk Solutions study included:
• Low activation rates of a connected services free trial are related to lack of awareness and opportunity to enroll, rather than lack of interest.
Two-thirds (66%) of survey respondents were not aware of connected services before purchasing/leasing their new or used connected car and over half (57%) were not offered a connected services free trial at the dealership.
LexisNexis Risk Solutions said its study findings suggest activation rates of a free trial would be higher if vehicle buyers were offered the opportunity. Eight out of ten (81%) car buyers offered a free trial enrolled and nearly half (45%) converted to a paid subscription after their free trial ended.
Among those not offered a free connected services trial at the dealership, seven out of ten (71%), indicate they would have been very/somewhat interested in enrolling if it had been offered.
• Consumers need to be educated on the benefits of connected services.
LexisNexis Risk Solutions found that almost one-fifth (19%) of consumers indicated they did not enroll in a free trial of connected services offered at the dealership.
The top reason, mentioned by the majority (63%) of the respondents, was that they did not see the benefit or the value of connected services.
Analysts pointed out those connected services benefits not realized can include the ability for a car to be located, unlocked or started, roadside assistance and vehicle diagnostics.
“In addition, over-the-air updates (OTA) can be important for consumers, including infotainment-related map or GPS information refreshes, audio updates, new app versions, streaming services, as well as drive-control-system updates, such as feature upgrades and security patches related to Advanced Driver Assistance Systems (ADAS),” the firm said.
• A more seamless experience could help consumers activate on their own time.
LexisNexis Risk Solutions said 64% of survey respondents said that having their information prefilled in connected services activation forms would make them somewhat or much more likely to enroll.
“Automakers can help consumers by prefilling connected service activation forms,” the firm said.
• Consumers expect automakers to keep them informed. Used-car owners also indicated that they expect to receive further information from their automaker on specific topics related to their vehicles.
LexisNexis Risk Solutions discovered Nearly everyone (92%), expected to be contacted about safety recall notices, with warranty coverage coming in second, selected by 80% of respondents.
“Vehicle features with the highest interest noted were safety and convenience services,” the firm said.
• Automakers can help consumers take advantage of their driving behavior data.
LexisNexis Risk Solutions noted that 67% of the respondents said they were aware that connected vehicles can capture and transmit telematics data, which can potentially be used to obtain insurance discounts. Only 22%, however, have used their data for insurance discounts.
Among those respondents who had not used their data for insurance discounts, 71% said they would be interested, according to the firm.
“Now is the time for automakers to advance their customer journeys and develop a comprehensive customer experience strategy using the advanced data and analytics available today, or face losing to the competition in a challenging market,” said Greg Ross, connected car practice lead at motormindz. “Consumers are telling us they are open to the engagement that connectivity provides and, in many cases, they expect it.
“Automakers can differentiate themselves from other automakers by creating a unique and high-quality customer experience that engages new and subsequent owners throughout the vehicle lifecycle and educates consumers on how connected services can support their needs and busy lives,” Ross continued in the news release.
Adam Hudson, vice president and general manager of connected car at LexisNexis Risk Solutions, added his perspectives from the study findings, too.
“One of the biggest takeaways is that by understanding their customers better, automakers can offer products and services at the right time, in a way that makes their customers feel valued and rewarded,” Hudson said. “That ongoing customer connection can help automotive brands continue to innovate and expand their connected services programs while improving the user experience.
“Automakers with fully maximized connected capabilities are able to more quickly develop and deploy new services and partnerships, gaining a competitive advantage by leading the market and increasing profits,” he went on to say.
The entire study can be found via this website.