Evolution of Automotive Digital Technology from Visualization to Retail

Mediawire
New Delhi [India], July 11: The heightened focus on digitalization across the automotive industry has accelerated the need for auto retailers to reimagine the way they operate. Digitalization is the top business priority for all stakeholders, including OEMs and dealers. The Covid-19 pandemic fast-forwarded the auto industry's shift to digital. However, the digital technologies could not evolve much owing to the sudden impact of the pandemic and only augmented the pace of implementation and acceptance of digital. This resulted in the knowledge gap being not effectively addressed during the pandemic phase.
Pandemic Accelerated Shift to Digital
The Covid-19 pandemic fast-forwarded the digital shift across the automotive industry given the spike in online buying behavior patterns, where digital was the first access path to any vehicle or product information. The pandemic perhaps dawned realization among auto retailers that they had to become more smarter, market-savvy, and fine-tune their legacy sales strategies to thrive in the digital world.
Automotive retailers have been traditionally accustomed to customers walking into dealerships and engaging with sales consultants with little or no prior product research before arrival in the showroom. All that has changed thanks to the power of the internet. Gone are days when a customer would step into a dealership unsure about which product they want to buy and have limited product research. Today, thanks to quick and easily available online searches, a customer is aware of so much about a product long before he buys it. According to a report, 8 in 10 vehicle buyers leverage online sources (online research checking the car's history, choosing suitable model, reading user reviews, etc) before buying cars.
CX is the Key
The 'experience quotient' for car buyers is of paramount importance - today, customers prefer a wide range of choices and are empowered with a slew of online reviews and end-to-end personalized experiences. Customers would not settle for anything but the 'best' and are willing to switch to a competitor brand in case of any negative experience.
Emergence of Digital Technologies from car visualization to auto retail
The automotive marketplace is evolving in a way products are showcased before the customer. The trend of OEM/dealer websites showing up simple 360 images was subsequently replaced by the more interactive WebGL technology that delivers product information in a much better way than 360 images. This emerging technology with the help of 3D modeling can go beyond just creating visually appealing car exteriors. It can help OEMs to design various components, such as custom car accessories as well as enable online customization of interior car designs and general prototyping.
Another technology that is making all the right noises in the auto industry is the Pixel Streaming technology. This cloud-based dynamic technology matches experience with real-life expectations, seamlessly paving the way for conversion from marketing to sale. Pixel Streaming has cinematic quality and loads instantly. More importantly, it drives clarity in terms of bringing the end consumer closer to his choice of brand variant selection and customization. However, unlike Pixel Streaming that stores and streams data from the cloud, WebGL uses device storage to load the data which makes the overall experience sluggish, adding to that, auto retailors using WebGL faces a higher probability of data breach.
Pixel Streaming has been deployed by several Indian OEMs - Hyundai Ioniq5, Honda, and Renault, Honda & Renault have leveraged this technology for their car range, and these are all mass products. The competitive technology edge probably is where India is at par or at some places ahead of the curve. The Indian IT infrastructure is witnessing growth on the back of powerful cloud-based data centers and faster data bandwidths. The day is not far when the Indian cloud will be powering the visualization for the automotive world.
AI at the Forefront of Disruption in Auto Industry
Like any other industry, the automotive industry has been embracing cutting-edge digital technologies such as Artificial Intelligence, computer vision, IoT, etc. aimed at making vehicles smarter and intelligent and car driving an enjoyable experience. The prominence of Artificial Intelligence can be witnessed across the auto industry.
The AI-enabled 3D printer technology has helped the auto industry accelerate innovation. It leverages 3D printers for creating automotive prototypes to check fitness, making aesthetically pleasant parts, designing efficient car models, etc.
Machine vision is another key technology the auto industry is deploying for unambiguous object detection, accelerating existing production processes, eliminating potential errors/risks, etc. It has high speed where the algorithms need milliseconds to detect, analyze, and process sufficient data from images. The potential of AI is immense in autonomous vehicles (AVs) that can sense the nearby environment and driving on its own sans any human intervention.
Artificial Intelligence is also making its presence felt in driver monitoring systems and vehicle tracking systems. Driver monitoring systems uses a driver-facing hi-tech camera backed by advanced on-board software to track drivers' eye movements and alert drivers of drowsiness, distraction, etc to avoid fatal road accidents. Vehicle tracking systems enable auto players efficiently locate the vehicle as well as help in the recovery of a stolen vehicle and provides details on fuel, speed, engine, etc.
Direct-to-Consumer DTC Model
The automotive industry is witnessing steady adoption of the Direct-to-Consumer (DTC) retail model, which is being touted as the 'Retail of the Future'. This retail model is expected to take customer experience to the next level. The DTC model drives higher levels of transparency, wherein dealers perform the role of franchise partners - what's more, the entire vehicle stock of an OEM is accessible to the franchise partners (dealers earlier) and customer through a centralized system. This model enables customers engage and complete the vehicle-buying cycle digitally and directly with the OEM, thus facilitating a streamlined purchase process. The retail model goes a long way in saving time of vehicle buyers as well as influencing their decision-making.
OEMs are having their fair share of challenges in driving a mindset shift by among their franchise partners and convincing them about this model. Franchise partners (dealers earlier) are now empowered with a centralized inventory, which effectively means that they can drive significant savings on storage costs, staffing, inventory, and logistics. Under this model dealers only take responsibility for physical interactions such as conducting test drives, processing transactions, vehicle handover, handling service appointments, etc.
Top German brand Mercedes-Benz adopted the Direct-to-Customer model in India and sold as many as 1,000 cars directly to customers even as its dealers handled test drives and delivery touchpoints. This reimagined retail experience has been a hit in the Indian market. Another automotive behemoth BMW is mulling adopting the DTC model or direct sales model soon and is believed to be actively engaging with dealers.
Conclusion
There is little doubt that Digitalization is here to stay but it does mean that physical in-store interactions would be a thing of the past. Physical dealerships would continue to stay relevant simply because customers would still want to visit a dealership and touch-and-feel the car as well as take a test drive. Automotive retailers must look to reimagine the car-buying process as an individualized journey for each client by resorting to deep personalization of the car buying and car ownership process, which can go a long way in building a loyal customer base.
Safe to assume that the auto retail space will continue to witness a hybrid model wherein customers conduct pre-sales activities online, but finally experiential sales will be key since customers would desire to walk into a dealership, touch-and-feel the vehicle, test-drive it before eventually deciding on whether to buy a vehicle or not.
(Disclaimer: The above press release has been provided by Mediawire. ANI will not be responsible in any way for the content of the same)