Customer Experience Emerging As Key Driver For Automotive Brands

Customer experience will continue to dictate business and operational models in the automotive and smart mobility space in the years to come.

Arguably, the disruption in the automotive industry over the last decade stacks up against all other industries. With the emergence of new media, technology innovations, emerging business models, and most recently, the COVID-19 pandemic, there has been a tectonic shift in journeys of automotive customers globally, especially in the developed markets.

Like the rest of the world, the Indian market is also undergoing a dramatic transformation. Indian consumers are investing a significant amount of their time in researching about vehicles during the purchase journey. Deloitte’s Global Automotive Consumer study highlights that the manufacturers and dealer’s websites are among the most credible sources of information for Indian customers and often play a crucial role in influencing their final decision and that they’re embracing the idea of connected vehicles at more than 1.5x the rate than consumers in the US. 

This study also points to the growing importance of getting CX right and delighting customers with dynamic content, interactive tools, meaningful insights, and customer support across all digital touchpoints to enable them to make better-informed purchase decisions.

Unfortunately, many automotive brands are failing to keep pace with new Customer Experience (CX) realities due to factors like the size of original equipment manufacturers (OEMs), complex sales models of dealers (who continue to be the lynchpins of automotive distribution chains), and so on.

Interestingly, Google research has revealed that as many as 900 touchpoints can influence automotive buying decisions. Overall, this increasingly complex landscape of possible touchpoints has led to customer journeys becoming serpentine and leaving customers more informed than ever.

Traditionally, many auto OEMs have viewed customer experience as the primary post-sale responsibility of their dealership partners. But times have changed. 

Some forward-looking OEMs have now begun to realize that CX is a differentiator and must be treated as a pre-sale activity and a focal point of innovation. Investing in building organizational processes and marshalling their resources to improve service experience have yielded repeat customers and improved customer loyalty for many of these OEMs.

Digital Experiences: A "New Normal” for Automotive Brands

Let’s face it: despite all the technological disruptions in the automotive space and cars becoming swankier and feature-rich, purchase and service environments and customer experiences haven’t changed much – even though customer expectations significantly have. Inspired by their digital experiences in other sectors, customers now seek new, modern experiences while interacting with automotive brands. 

Today’s Gen Y or millennials find the automotive customer experiences somewhat outdated and inferior. With their declining interest in car ownership and preferences shifting toward new mobility concepts such as ridesharing, subscription models, or even rental services, the underlying model shifts from product to service to customer experience. But the current disconnect in what customers expect and finally get to experience is becoming more conspicuous than ever.

According to the Experience Per Mile 2030 report by 2030, “96% of new vehicles (will be) shipped globally with built-in connectivity (2X increase since 2020), 79% of new vehicles (will be) shipped globally with Level-2 autonomy or higher (vs 45% in 2020), 26% of mobility profits (will be) derived from new sources. 

With these four megatrends disrupting the automotive sector - autonomous driving, connectivity, electrification, sharing economy (ACES), legacy OEMs and dealers are now forced to rethink their business strategy to –

  • address the expectations of this first generation of integrated-mobility customers.
  • deliver more contemporary, superior customer experiences.
  • maintain their competitive advantage.

Even before the stage of purchase decisions, automotive brands are battling for customers’ attention based on the quality of experiences besides the quality of their products.

The transition to digital customer experiences in the automotive sector just hit fast-forward due to the recent COVID-19 pandemic. Incremental improvements didn’t suffice. Automotive brands were forced to jump years in a matter of few months to offer simple, intuitive digital customer experiences. 

Digital-first Go-to-Market (GTM) Strategy

Nearly 70% of the customers expressed their willingness to replace visits to the automotive dealer, store, or bank with AI-enabled assistants. 

Honda Cars leveraged this trend and launched their virtual showroom, enabling customers to browse through the digital version of a car and interact by clicking on different parts.

Interestingly,, a technology company, partnered with MG Motor India last year and used its own AI platform to offer life-size AR compliant renders on Facebook and Instagram platforms for the automaker’s new product line-up. Similarly, the company partnered with Volkswagen to offer immersive experiences to customers with life-size 3D versions of its SUVW range. 

It’s a no-brainer that the “new normal” in the automotive sector is marked by:

  • A transition toward live streaming, digital product launches, virtual brand centers, etc.
  • Surge in digital experience solutions, e.g., test drives, AR product explainers, online consultations, etc.
  • Shift toward the on-demand purchase and usage models
  • Predictive maintenance services and replacement of vehicles
  • Next-best offers from OEMs and dealers focusing on emotional connect

However, automotive brands must address the complete spectrum of customer experience and not individual touchpoints across the customer journey while embracing a digital-first, GTM approach. 

The German premium automotive brand Mercedes-Benz has planned to drive 25% of its new car sales transactions online by 2025 and developed a “single log-in” digital strategy that offers lifestyle, mobility and shopping solutions to owners and non-owners alike. Also, its customer touchpoints have widened to include temporary pop-up stores, lifestyle-focused Mercedes Me stores, events, and conferences.

However, shifting customers to digital channels even before the automotive brand is ready or only has subpar digital capabilities for targeted touchpoints can trigger the “boomerang effect”, forcing customers to repeatedly contact the brand for troubleshooting or issue resolution. This can severely hurt impact the CX and the brand’s revenue growth.

Nimble technology services organizations are well abreast of these trends and paradigm shifts in the automotive space. Using the right technology framework, they’re crafting streamlined and humanized digital journeys for customers, bringing together three pillars of customer service – end-customer experience, operational efficiency, and support agent productivity; powered by intelligent insights.

Customer experience will continue to dictate business and operational models in the automotive and smart mobility space in the years to come.

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house

Tags assigned to this article:
csscorp Customer Experience Strategy


Around The World