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Automotive software can improve customer experience beyond just diagnostics

We had the opportunity to speak with Sripriya GN, who has worked at Ather Energy, leading software-side product management. The interaction focuses on the role of automotive software in the 2W space. Sripriya believes that automotive software has the potential to improve customer experience and ride quality beyond just diagnostics, which is currently the more prevalent area of software deployment.

I have a background in SaaS, and my introduction to automotive software came when I joined Ather Energy. My tenure with Ather began around the time when their first model, the 450, was launching. I’ve been part of Ather for approximately five years. Recently, I decided to take a career break for a few months.

During my time at Ather, I led product management from the software side, including the companion app and the platform for data analytics, digital channels, service, sales, delivery experiences, and the dealer management system.

We have found that the majority of individuals don’t find their daily commute enjoyable and have internalised the considerable anxiety associated with it. Concerns about navigation, traffic congestion, safety (especially for two-wheeler riders, particularly at night and for women), and the constant connectivity of modern life all contribute to this stress. The fact that commuting often occurs during peak productive hours only worsens the situation, as it results in time being wasted without accomplishing meaningful tasks.

Examining the entire journey, from the initial intent to travel to finding parking and beyond, highlights the numerous friction points and sources of anxiety that individuals silently endure. Fortunately, advancements in communication technology and solutions such as navigation and call controls present an opportunity to address these challenges and enhance overall well-being by alleviating the stress associated with commuting.

I primarily addressed issues in customer experience, though most people today still utilize this technology primarily to enhance vehicle diagnostics. I believe that only uses about 5 to 10% of automotive software’s potential. Building an entire solution around addressing downtime seems premature from the outset—the majority of the problem space and the opportunity to solve lies in improving customer experience. It is not just about having technology and building any feature.

The key is to approach it with a product mindset. Take Ather’s pioneering introduction of a touchscreen dashboard on a two-wheeler, featuring maps as a core component. This addresses a relatable problem for many who prefer avoiding the hassle of navigating unfamiliar locations.

While smartphones offer maps, constantly stopping to check directions during a journey can be cumbersome, especially on a two-wheeler. Another impactful feature introduced was call controls. Many view commuting as wasted time and wish for more efficient ways to utilize it, highlighting the need for seamless solutions like call management while on the go. This demonstrates how software innovations can significantly enhance the journey experience.

That title was deliberately provocative, stemming from my deep passion and years of experience in the field. When I say ‘automotive software has largely failed’, I’m referring to how success is typically measured in consumer electronics or devices. It’s about how consumers perceive your product—are they talking about it, are the reviews positive, is there excitement and word of mouth driving sales? This is the gauge of success. If you attend keynotes or look at gadgets, you can gauge their potential success based on buzz and sales figures.

However, with automotive software, things are different. There’s limited public information available because it’s not sold as an independent product; it’s part of the automotive package. However, we can still measure success through other indicators. For instance, press coverage rarely focuses on automotive software, and many drivers don’t even use the features. This lack of utilization means it doesn’t influence purchasing decisions or generate buzz. This is why I say it hasn’t taken off as predicted. The earlier expectations of revolutionizing the automotive business model, akin to what the App Store did for iPhones, have fallen flat.

Monetization has been a challenge, as has getting people to use the software in the first place. If there were more users creating noise about bugs or issues, it would indicate engagement, but that’s not the case. Overall, the lack of interest and utilization suggests that automotive software has largely failed to make an impact.

I believe there are three key areas where OEMs are falling short.

  • Firstly, they need to view automotive software as a product, not just a tech add-on to vehicles as an afterthought. It’s not enough to simply enable features; there needs to be a vision for the entire user experience, from onboarding to daily usage. Currently, many vehicles have the capabilities, but the overall experience is lacking due to this fragmented approach.
  • Secondly, understanding that automotive software requires a different mindset akin to communication technologies is crucial. Unlike traditional vehicle design, software development operates on faster timelines and allows for continuous discovery and iterative development. OEMs need to adapt to this approach to leverage the potential of automotive software fully.
  • Lastly, the organizational structure within many automotive companies needs to be updated. The individuals responsible for automotive software often lack seniority and influence, leading to key product decisions being made without their input. This lack of representation hinders the effective integration of software into vehicle design. Addressing these gaps is essential to unlocking the full potential of automotive software.

The answer depends on various factors. One of the most significant considerations is your company’s DNA and where you aspire to be.

  • If your company prides itself on innovation and introducing breakthrough technologies to the market, it’s unlikely that you’ll find off-the-shelf solutions from vendors that meet your needs. In such cases, building in-house capabilities is necessary.
  • However, if your competitive advantage lies in execution and you excel in areas like manufacturing or distribution, and you can achieve parity in certain capabilities or features, then working with external vendors may be a viable option.

Ultimately, understanding the dimension on which you compete and the market realities is crucial. For instance, mature products may justify adopting off-the-shelf solutions, but in nascent industries, in-house development is often required, with knowledge eventually spreading across the ecosystem. Both approaches can coexist, but regardless of the path chosen, having a clear vision for the product and executing it effectively is essential.

What truly excites me is not necessarily the automotive sector itself but rather the broader trends in consumer electronics and how they can be applied in automotive contexts. One trend I’m closely watching is the emergence of AI-driven devices.

  • While voice technology, including voice recognition and speech-to-text capabilities, has been around for a while, it has often lacked the ability to comprehend intent accurately, leading to limited interactions. However, with the advancements in conversational AI, the interactions with devices can be more natural and conversational, reducing the barrier for users who may not be digitally savvy. Imagine being able to instruct your vehicle using natural language commands, such as asking for parking assistance or requesting navigation to a nearby cafe. These advancements enable vehicles to understand user intent and provide personalized recommendations seamlessly.
  • Another area of interest is enhancing productivity while driving without compromising safety. Features like call controls and message management are just the beginning, and there’s immense potential to integrate more productivity tools seamlessly into the driving experience. Overall, I’m excited to see how these trends continue to evolve and reshape how we interact with vehicles and enhance our driving experiences.
  • Features related to EVs, particularly those focused on navigation and smartly locating charging points, address a crucial aspect of the navigation challenge.

In the short term, when there are still relatively few vehicles on the road equipped with these capabilities, assuming everything is functioning successfully and there is significant user engagement – monetization can occur in two ways. Firstly, by commanding a premium on the vehicle itself, perhaps up to 25% to 40% higher than vehicles without these capabilities. Secondly, offering these features as part of a subscription model is becoming more common even in the Indian market. This second approach could potentially generate additional revenue of around 10% to 15% per unit sold compared to companies that haven’t focused on such offerings.

Looking ahead to the long term, with millions of these vehicles on the road, there is the opportunity to build an entire ecosystem around these services. This could involve affiliate revenue, where partnerships with brands could be established to showcase their products or services to engaged users on the platform. While traditional advertising may not be the preferred route, exploring innovative affiliate revenue models tailored to the engaged user base could be highly lucrative.

Like I said, much of the industry today still views connected tech as primarily serving the diagnostics piece. From the feedback I’ve gathered from vendors and different players in the ecosystem, that seems to be the prevailing perspective among OEMs as well. I believe it’s not a huge value add but rather an incremental one.

Consider this: Do you want to know what’s working or not working in your vehicle? You would assume that everything is working. Having a checklist to confirm this may bring some anxiety, as you hope such issues are rare occurrences.

Similarly to safety features, while useful, you hope you never have to use them. So, any feature designed with the hope that it’s seldom used won’t be perceived as a key value by consumers. While servicing is considered important during vehicle purchase, the ability to remotely monitor vehicle health may not significantly sway consumer purchasing decisions. It may be perceived as useful but not necessarily something consumers are willing to pay a premium for.

Instead, diagnostics features are more valuable for OEMs to enhance their efficiency in servicing through remote monitoring and predictive maintenance. Overall, while it’s a good-to-have capability, it’s not a feature consumers actively seek out or value highly in their purchasing decisions.

Also read: How electric scooter market is different from ICE scooter market

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