“With millions of cars rolling off dealer lots with built-in connectivity, auto companies are gaining access to unprecedented amounts of real-time data that allow them to track everything from where a car is located to how hard it is braking and whether or not the windshield wipers are on.” (Wall Street Journal)
This data has potential beyond vehicle operation and automaker information. Auto manufacturers are interested in the potential new revenue stream that could come from monetizing this data. Automakers could have the ability to build a Google type ad platform, allowing businesses the ability to be put in front of drivers at opportune times.
According to McKinsey & Co., these “revenue streams could be worth as much as a whopping $750 billion – yes billion – in little over a decade.”
This figure seems outrageous, but when you consider what is already being rolled out, according to eConsultancy, it is less preposterous:
- GM’s Marketplace app helps drivers find parking spaces and schedule service appointments. The app will soon be including sending gas station deals to a driver when the vehicle is running low on gas.
- Hyundai is planning to launch a program that will give drivers discounts from insurance companies based on their driving habits.
Somebody’s Watching You
Cars with onboard entertainment systems allow drivers to hook up their smartphone with the Bluetooth or a USB connection. These connections allow the car to access data right from the drivers’ personal device. This includes contact lists, call logs, text messages, photos, location data, etc.
Also included in nearly every new car sold now is the EDR or the Event Data Recorder. The EDR is known as the car’s “black box” and it collects data in the event of an accident. Data collected includes driving behaviors, speed, and whether the airbag deployed.
Currently, EDRs only become available if someone intentionally access the information, i.e. after an accident.
Location-Based Marketing in Hyperdrive
Newer vehicles have a tracking technology that actively tracks the vehicles movements. Which is explained to consumers in the sales paperwork when buying a car, so drivers have given permission for this data to be used.
Currently, there are 78 million cars on the road with this tracking technology and experts estimate that within just a few years 98% of all cars sold will have it.
This location-based tracking data is useful for local businesses, insurance agents, realtors, and more.
Additionally, the location tracking can offer insight into the patterns of the driver, such as where they are going based on past habits, time of day, route taken, etc. This location-based analytic is valuable to the businesses the drivers frequent most and even the daily habits like going to the local school or working out at the gym, great information if you want to sell products aimed at mothers or fitness fiends.
Pumping the Brakes
There are a lot of issues that need to be ironed out with this data collection. Many consumer watchdogs are concerned about data security and privacy issues. There will likely need to be some sort of opt-in process required for automakers to use the data obtained from individual cars.
However, for businesses looking for a new, wide open field to advertise this may be promising.
The data collection from the army of sensors in modern vehicles can collect a lot of valuable location data. The sensors can collect data on the car’s speed, temperature, fuel levels, braking patterns, and even if there is a passenger in the car.