Our relationship with motor vehicles is a complex mix of emotional and rational decision making. Add to this, external influences such as longer product-retention cycles (up from five years to as much as seven years), a struggling economy and probably the greatest product choice in the market we have ever seen; there is a significant need for manufacturers to reinvent the car-buying experience.
So, while the “future of mobility” is evolving to enable new technologies such as autonomous vehicles, connectivity, electrification and shared mobility – it is necessary that there be a proportional shift in how we can innovate how these products are purchased or considered at the onset.
This trend is not new. As early as 2013, global consulting firm McKinsey published a report highlighting three key trends that would impact customer decisions and engagement on the retail end of the automotive industry. These included: an enhanced level of what it called “touchpoint management”, sales and service upgrades and the role of the traditional Dealership in the customer purchase and sales decision journey.
Fast forward to 2019. The challenge for automotive brands is how to deliver a personalised, digital service in an industry once solely reliant on bricks-and-mortar Dealerships and a hard-sell sales approach. In the premium segment, there is even more room for innovation around the Dealership experience to meet the demands of personalisation and technology while still delivering on fundamentals. This includes aspects like physically experiencing the vehicle before purchase, expert product advice and the personal customer experience that enhances long-term brand experience and loyalty.
Behaviour-driven thinking dictates how we reframe and design the customer experience of the future. As an automaker in the premium segment, we focus on three key principles of behavioural planning:
- The paradox of choice: Offering customers more choices is not always better, as we can trigger an unintended “paralysis of choice”. When we have too many options, the likelihood that we will make a decision is reduced. Given this, Audi has reviewed our options specification for new products entering our model range and will be developing specific packages around various customer needs. This allows for reduced complexity of choice and ease of ordering a new vehicle. This will be reflected on our digital platforms when configuring any of the new vehicles such as the Audi Q8 and upcoming Audi A1 and Q3. This simplification is the first step towards addressing how customers experience us as a brand.
- Availability: Creating opportunities for customers to assess choices through innovative and digital examples is a foundation of how we are slowly reinventing our Dealership experience. We are pioneering this by introducing the Customer Private Lounge (CPL) – one of a kind in South Africa and located at Audi Centre Centurion in Pretoria – that allows customers to build up their Audi using digital configuration and virtual-reality technology.
- Relativity: Customers are more likely to make decisions based on the context. While traditional Dealerships will remain key to the customer’s sales journey, Audi aims to connect new opportunities within this environment. This includes a combination of traditional selling (knowledgeable consultant, premium environment) and digitalisation (customisation, low need to carry extensive showroom stock).
The launch of the Audi Customer Private Lounge is the foundation of this latter effort. A recent Bain survey found that even web-savvy modern car buyers’ still make an average of 2.4 Dealer visits before making a purchase decision – underlining the critical importance of combining a relevant and unique Dealer retail experience when finalising a sale.
Another foundation of our retail experience effort effort is a 4000m2 Audi and Volkswagen Training Academy in Centurion, custom designed to continuously improve Dealer performance through training and skills development. Added to this is Audi’s global and digital initiative towards training – Audi Training Online. This is an online platform offering convenient learning for all Audi dealership employees around the world. Employees can access the portal at any time, from any location and easily upskill themselves on brand related topics, products, technologies and job related (technical and non-technical) subjects. Given the increasing technical complexity of our vehicles and new business and brand themes, a high level of knowledge and expertise is critical to ensure optimal customer satisfaction.
The evolution of training and customer experience is the first, necessary step to respond to today’s car-buying customers’ demand for a unique retail environment. As an industry, we need to respond to this opportunity sooner rather than later. This response must deliberately address the customer experience journey from information, to contact, to purchase, handover and to aftersales. This requires interventions in terms of personalisation, how we introduce opportunities for customers to be in control while still receiving expert guidance.
A more digital retail platform gives us a significant opportunity to better serve our customers through this journey. In the case of the CPL, a dedicated consultant, specially trained, takes the customer through the process of selecting the customised specification on their virtual-reality Audi, before they even encounter a salesperson. The CPL represents the first leg of Audi SA’s digitisation strategy. It’s progress in the retail realm, and a game changer for the automotive industry.
In future, automotive retail will require many new functions and roles to meet the demands of an omnichannel sales model. Building these new capabilities is a fascinating process, bringing in new skill and fundamentally refreshing the industry to benefit the most important stakeholder – the customer.
Volvo and Uber get closer to self-driving XC90
Volvo Cars’ first autonomous drive (AD) ready car has entered the next stage of pre-series production at Volvo’s manufacturing plant in Torslanda, Sweden ahead of full production start later this year. The AD-ready XC90 SUV, developed together with Uber, the leading ride-hailing firm, marks a key milestone in the strategic collaboration between the two companies.
Pre series production refers to the stage in the manufacturing process that is undertaken before full-fledged mass scale production. These cars are built in limited numbers for testing and verification purposes.
Uber and Volvo Cars entered a joint engineering agreement in 2016 and have since developed several prototypes aimed at accelerating the companies’ self-driving car development.
The autonomous drive-capable production vehicle is part of Volvo Cars’ 2016 commercial agreement with Uber for the delivery of tens of thousands of autonomous drive-ready base cars in coming years.
The AD-ready XC90 SUV, developed on the SPA2 modular platform is equipped with features that facilitate the introduction of autonomous drive systems and robotaxi services. In particular, the car is equipped with back-up systems for functions such as steering, braking and the battery. If any of the primary systems fail, these systems would immediately act to bring the car to a safe stop instead of relying on a human driver to achieve the task.
The XC90 is one of the first autonomous drive-ready cars in the world and previews the type of autonomous base platform that will be available to consumers on SPA2 cars from the early 2020s.
Maserati goes ‘e’
In line with Fiat Chrysler Automobiles’ €5 billion investment program for Italy, Maserati has announces an innovation plan for production, electrification and autonomous driving technologies.
With regards to production, Maserati has announced plans for a lineup of new and electrified products at Modena, Cassino and Turin (Mirafiori and Grugliasco).
All of Maserati’s new models will be 100 percent made in Italy and will adopt hybrid and battery electric propulsion systems capable of providing both innovation and the high performance embedded in the brand’s DNA. Maserati’s all electric models will combine traditional Maserati driving dynamics together with next-generation battery electric technology, offering unique driving modes, extended range and ultra-fast charging capabilities.
An important step for Maserati innovation is the level of autonomous driving. All new Maseratis, including the updated current models, will offer a range of autonomous driving capabilities, starting with Maserati Level 2 enhanced Highway Assist, progressing to Level 3 with hands-off offering close to full autonomy, having the ability to maneuver in and out of lanes or bring the vehicle to a safe stop at the side of the road if the driver is unable to take control of the vehicle.
In 2020, the Company will embark on electrification and the Maserati Ghibli, produced in Turin, will be the first hybrid electric propulsion for the brand.
The first of the totally new Maseratis to appear will be an eagerly-anticipated sports car – packed with technology and reminescent of Maserati’s traditional values. It will be produced in the Modena plant, where major production line upgrades are also underway to accommodate its electric powertrain.
Next up will be a new Maserati utility vehicle, set to be built at Cassino and destined to play a leading role for the Brand thanks to its innovative technologies. An investment of approximately €800 million has been earmarked for the construction of the new production line, scheduled to open at the end of the first quarter of 2020. The first pre-series cars are expected to roll off the line by 2021.
After many years of success, GranTurismo and GranCabrio remain part of the Brand’s roots and these models will herald the full electrification era for Maserati. The totally New GranTurismo and GranCabrio will be produced at the Turin production hub, where FCA is investing €800 million.
Production of the new models will complement that of the prestigious and continuously improving line-up of current Maserati range: Levante, Quattroporte and Ghibli.
With the introduction of various product innovations, Maserati is reinforcing the importance of Italy with regards to its production — particularly Modena, which will also continue to play a strategic role as the Brand’s headquarters.
Construction has already begun in Modena on a paint shop, a new feature for the plant, which will be equipped with innovative, low environmental-impact technologies. The design of the paint shop will also allow Maserati customers to watch their car being painted.
Finally, Maserati is developing an entirely new customization program for customers seeking a one-of-akind level of exclusivity. A dedicated customization workshop will be created within the Modena plant.
The 2019-2021 FCA investment plan for Italy, announced on 29th November in Turin, includes thirteen totally new or significantly updated FCA models and electrified versions of 12 new or existing models, including the Maserati products, the recently announced all-new electric version of the Fiat 500 to be produced at Mirafiori, and a new premium vehicle for Alfa Romeo to be produced at Pomigliano.