Are connected cars the new media frontier?

Recently, Renault, Nissan and Mitsubishi Motors announced its partnership with Google to bring Google into their dashboards while Amazon announced the limited launch of Echo Auto, a tiny dashboard device that brings Alexa into your car. The days of cars being simply the vehicles to get you from A to B are numbered. They are becoming places where you can ‘engage’ with the outside world – and as such their potential for advertisers is hugely exciting. Could connected cars (cars equipped with internet access, either through auto devices or inbuilt capabilities) be the new media frontier and automotive firms the new media brands?

Well, we’re not quite yet up to 12 cylinders but we’re moving in that direction. Sales of connected cars in the UK are on the up according to Statista, predicted to rise from four million in 2016 to 19.5m in 2022. BMW, General Motors, Nissan and Toyota are now competing with top-end luxury brand Tesla and this will inevitably drive the cost down and accelerate take up.

Connected cars are data creators

Advertisers like scale, so it’s a no-brainer that more connected cars will mean more interest in in-car advertising. Of particular interest will be the phenomenal amounts of data that connected cars can collect, with some estimates suggesting 25GB per hour per car and McKinsey predicting that the automotive data industry will be worth $450-$750bn by 2030.

Connected cars track where you are at any given time, where you shop and work, the music you listen to and what you do at the weekend. Plus, they have external cameras which can film everything and everybody. Tesla's even have small in-car cameras which are apparently not switched on (yet) but imagine when they are and your every move (and ad engagement) can be monitored. It’s like big data on steroids!

In today’s data-driven advertising world this is very exciting for automotive firms who must be thinking about the huge potential to sell ‘in-car inventory’ and become big data players. However, there are still several thorny issues that need to be resolved – especially around privacy – before they can bank the money.

Complex issues are holding in-car advertising back

Firstly, as automotive firms partner up with tech companies like Apple and Samsung to pre-install their operating systems in their vehicles, which party will own the data? Or, in fact, could the data be owned by savvy consumers who could use this to monetise car ownership (blockchain is opening up potential here).

And with data being created in such massive volume it’s going to be hard to manage – working out which data is useful, and who it is useful for, will be essential. Plus, for maximum market value to be realised, the data will need to have some common currency – walled gardens owned by each car brand will ultimately not be useful to consumers and brands.

Secondly, will issues arise from the companies that automotive firms partner with for their operating systems? If a consumer favours Android over iOS will that become an active element in their car purchase? Also, will the relationship that automotive companies have with their customers weaken to that of the chassis provider, while consumers engage more with tech, app and retail companies? Automotive manufacturers are not going to want to lose their differentiation.

Where data, technology and the internet combine, there are also cybersecurity considerations. The advertising industry is already having to cope with fraud and the rise of the bot, but when you’re talking about the potential for hacking a two-tonne moving object the stakes are much higher – as you can see in this video where a hacker remotely takes over a car. If automotive firms want to get permission from their drivers to use their data, they need to demonstrate that their systems are failsafe and that there is value to the driver.

Consumer behaviour is also a massive consideration. There is likely to be resistance to commercial messaging in-car because this will feel intrusive in what many feel is a personal space, and there are obvious safety issues around distracting drivers; serving up ads to drivers as they come to a halt will simply not be an option as people will avoid braking to swerve the ads. Interestingly, last year BMW announced it would not be selling data for in-car ads as it didn’t feel that serving ads on its head-up display would be fitting with the brand experience its drivers want.

Mass take-up of AVs will revolutionise the media landscape

The real game-changer will be mass take-up of the driverless car, or autonomous vehicle (AV). Obviously, this isn’t the very near future. However, AVs have the potential to completely transform media consumption, especially when 5G ensures reliable internet connection on-the-go. Cars then become bona fide leisure centres. People will be able to work, watch TV, catch up on news and interact on social media. AVs could compete with mobiles as the most important devices for online shopping. There are even reports suggesting, er, ‘other activities’ that might go on, on the back seat, but this isn’t the time or place for that.

As consumer perceptions and behaviour around AVs shift, so will their acceptance of advertising – especially if it isn’t interrupting the actual driving. This could simply be driven by automotive firms offering discounts to people who opt-in to receiving ads to fund the technology. However, there should be more benefit-driven reasons for opting in to commercial in-car communications, with advertisers adding to a driver/passenger’s enjoyment of their car journey through entertaining, engaging and informative interactions.

For instance, as a music lover drives past a venue they could be informed that an artist on their playlist is gigging there in the next two weeks and be given the option to buy tickets via a virtual assistant. Or Starbucks could recognise a customer when they get within two miles of a coffee shop and ask them if they want to order a coffee-to-go. They then order it via a virtual assistant, pay for it through the app and their favourite beverage is ready and waiting as they drive up.

Digital billboards could serve up personalised ads as people drive by, and this could be enhanced by the car having a filter feature (like Google Glass) showing a tailored offer and even providing an augmented reality brand experience.

The opportunities for the future are mind-boggling, offering highly accurate, high volume data that is based on behaviour and geo-location. The ultimate targeting capabilities encapsulated in one metal box. But in the end, how will this really pan out for automotive brands? Now is the time when they should be investing in research, development and consumer insight to understand the myriad of opportunities that could be open to them.

An uncertain, but exciting future

In 10 years’ time could smart cars be bigger than Facebook? Or, indeed, could we be driving Facebook or Google cars? Alternatively, will the environmental issues surrounding cars win out by then, meaning consumers will have opted out of car ownership altogether to take up one of the burgeoning ‘Transport as a Service’ options instead? Maybe Uber could be the biggest media brand?

These are exciting but uncertain times in the world of automotive, but one thing is for sure: it’s going to be an interesting ride – on the front or back seat.

Martyn Bentley is commercial director UK at AudienceProject