Telematics and customer relationship management

Telematics and customer relationship management

Telematics-enabled customer relationship management(CRM) has the potential to reshape OEM-dealer-driver relationships, and perhaps OEMs’ relationships with insurance companies as well. Dominique Bonte, vice president and practice director at ABI Research, describes CRM as an “umbrella platform” that allows OEMs or dealers to reach customers “more efficiently” to offer services based on their profiles.

Telecoms service providers are also discovering the potential for value-added services and are taking steps to provide systems that can be put quickly into place. (For more on value-added services, see Why telematics needs better consumer marketing, How to customize telematics to meet consumer preferences and Consumers and UBI: The power of value-added services.)

For example, Octo Telematics now provides a series of ancillary services that include CRM applications, reports Giampiero Luccitti, the company’s head of corporate development. “It’s true that [CRM is] not our core, but it’s absolutely true that this is one of the main elements exploited by carmakers to strengthen their relationship with drivers,” he says.

Data about the status of the car can be of great use to OEMs and insurance companies if they communicate it in a useful way to policyholders or drivers. (For more on data, see Telematics and UBI: The data challenges, Telematics and the value of data, Telematics: How positive customer relationships improve ROI, Telematics: Using marketing partnerships to build brands and Telematics and probe data: The revenue opportunities.)

Make it easy and fun

Reaping the benefits of telematics for CRM is all about technique and approach. It’s a matter of “providing advice to the driver in order to improve the way he’s managing his asset, the car itself,” says Luccitti. Not only can OEMs alert drivers when they need to bring their car in for maintenance, they can let them know when their tire pressure could use adjustment and why that benefits them—improved safety, more reactive brakes, and lower fuel consumption.

But the most effective CRM communications will be more than just directives and data. OEMs need to make it “easy and fun” for drivers to access data about their behavior behind the wheel, says Bonte: “Add an element of gaming or social networking so people can compare data and behavior or their fuel consumption. This makes it more digestible.”

These ideas fall under ‘vehicle relationship management’—diagnostics, maintenance, and perhaps vehicle-centric firmware updates. But the larger umbrella of CRM is about a more complete experience, Bonte argues, including offering or upselling content and apps to drivers, navigation, and better entertainment and better information. (For more on content and apps, check out Content and Apps for Automotive USA 2012 on Dec. 4-5 in San Diego and read Special report: Telematics and apps.)

Off-the-shelf solutions

Perhaps the biggest boon for OEMs is the fact that CRM systems don’t have to be built from scratch.

Often OEMs can adapt their existing telematics systems and “fine tune them to add a customer dimension,” says Bonte. A CRM system just needs access to vehicle data, which is already in place with an embedded telematics system but may not be as available via smartphone-integrated approaches.

“We use what is already existing, already tested, already successful on the market, but we have decided to reshape and reconfigure that in a different way to provide value,” says Octo Telematics’ Luccitti. OEMs can receive data for use with their legacy systems or access a Web-based system provided, and perhaps managed, by the TSP.

Dealing with dealerships

As OEMs move into the CRM game, their relationships with dealers as well as drivers is likely to change. Luccitti points out that maintenance updates and scheduling are likely appreciated not only by drivers but by dealers as well, because advance notice about which vehicles are coming in for service helps them better manage their resources, including space and staff. (For more on dealerships and TSPs, see Telematics and dealerships: How to connect dealers to connected cars, Telematics: Connecting the car to the home and Reinventing the telematics service provider.)

Right now the dealer is an important touch point for OEMs to contact customers regarding sales and maintenance as well as upselling services and apps, notes Bonte. But in the process of improving their direct link to drivers, OEMs may risk alienating dealers, who are used to owning the customer relationship.

In addition, as CRM grows in popularity, other parties will be involved in communicating with customers, telematics-enabled insurance companies, for example, or TSP call centers. “There’s a big risk if everyone is reaching out to the driver but not in a coordinated way,” says Bonte. “There’s a big objective to get the players working together.”

Telematics-enabled CRM

Many in the industry are already enthusiastic about telematics-enabled CRM. Octo Telematics is planning a six-month worldwide road show at the start of 2013 to demonstrate to OEMs the CRM benefits they can provide.

Bonte, however, urges caution: “CRM should be seen as incremental.” Start small and work with the data and touch points you have, he suggests. There’s definitely a wealth of data available, and OEMs definitely need to channel it into better service for their customers, but the auto environment is complex.

Apple has perhaps set a customer service standard with the ease of updates and maintenance on the iPhone, but “a handset vendor has a one-to-one relationship with the owner,” Bonte notes. CRM is “a marketing system more than anything else. What exactly you’re doing with it is virtually unlimited. The OEMs will just figure out how far they want to take it.”

Jessica Royer Ocken is a regular contributor to TU.

For more on content and apps, see Special report: Telematics and apps.

For all the latest telematics trends, check out Telematics for Fleet Management USA 2012 on November 13-14 in Atlanta and Content and Apps for Automotive USA 2012 on December 4-5 in San Diego.

Coming up in 2013: Consumer Telematics Show 2013 on January 7 in Las Vegas, V2X for Auto Safety and Mobility Europe 2013 on February 19-20 in Frankfurt, Telematics for Fleet Management Europe 2013 on March 19-20 in Amsterdam, Insurance Telematics Europe 2013 on May 8-9 in London and Telematics India and South Asia 2013 on June 5-7 in India.

For exclusive telematics business analysis and insight, check out TU’s reports on In-Vehicle Smartphone Integration Report, Human Machine Interface Technologies and Smart Vehicle Technology: The Future of Insurance Telematics.

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