Connectivity
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Connectivity

Back to Overview

Connectivity

We help companies in automotive, high-tech, insurance, and other industries turn vehicle connectivity data into valuable, customer-centric products and services.

Connected cars generate data about how and where they are used and who is behind the wheel. As usage for shared mobility, powertrain electrification, car autonomy, and vehicle connectivity grows, the amount of data collected from vehicles will rise exponentially. This presents opportunities for companies in the automotive ecosystem to monetize data.

Based on our research—comprised of surveys, consumer interviews, and observations—we expect the global value pool from car data monetization to reach $450 billion to $750 billion by 2030 (revenue pool of $200 billion to $250 billion, plus significant potential from costs avoidance).

Projected impact

There are two capabilities we believe companies in the industry should have in order to stay competitive. The first is to quickly build and test car data-driven products and services, and the second is to develop new business models built on technological innovation and strategic partnerships.

Our research identifies more than 30 connectivity use cases for data to generate value for both individual end-users and businesses. These range from predictive car maintenance features, over-the-air software updates, and vehicle usage- based insurance. Each use case has the potential to create value in one of three ways: revenue generation, cost reduction, or safety and security enhancement.

Value creation models

Revenue generation

Direct monetization—selling products, features, or services to the customer

Tailored advertising—leveraging car data to push individual offerings to customers

Selling data—collecting, analyzing, and reselling big data to third parties

Cost reduction

R&D and material cost reduction—gathering product field data for development

Cost reduction for customers—analyzing actual usage patterns to reduce repair and down time costs

Improved customer satisfaction—better tailoring product/services to customer needs

Security enhancement

Reduced time for intervention—collecting and forwarding warnings in real time, pointing in the right direction

Our surveys reveal that customers are interested in data-enabled features that make mobility safer, more convenient, or save them time or money. Across geographies, nearly two-thirds of consumers saw the various car data use cases as personally relevant, and more than three-fourths deemed them useful. In order to develop these features, however, users need to be willing to share personal information retrieved from their smartphones, such as calendar entries and email.

Insights from our research on car data monetization indicate that car data monetization requires a set of enablers across three broad categories that include in-car technologies (for example, sensors and navigation hardware), infrastructural technologies outside the vehicle (data towers and cloud computing), and back-end processes that facilitate the analysis of and secure sharing of car data (cybersecurity operators and regulators).

Client impact examples

Client impact examples

Creating an internationalization concept

An auto manufacturer develops a standard global concept for future connected car services in a key vehicle segment, along with an implementation strategy for US market entry.

Defining an operating system strategy

An auto manufacturer analyzes the impact of operating system selection, the breakdown of data ownership by type, and detailed modeling of revenue opportunity.

Assessing the viability of a data and analytics business

A media and entertainment company evaluates an opportunity to build an at-scale, profitable data and analytics business in connected vehicles.

Cross-industry perspectives

As vehicle connectivity comes to market, we anticipate disruption across multiple sectors and industries. We have identified critical areas of focus for incumbents and new entrants in these particular sectors wanting to keep pace amid the changes ahead:

Automotive

There will be consolidated monetization models, along with changes in product cycles, the value chain, and interactions with end customers.

Technology

Partnership strategies, app development and execution will evolve.

Insurance

Usage-based insurance will impact premiums.

Proprietary assets

Proprietary assets

Our research has developed extensive insights and tools to address critical connectivity topics that include:

Car data use-cases and revenue pools

Our model quantifies the overall car data revenue pool and the opportunities for businesses based on selected and prioritized use cases.

Sharing of data

Our surveys administered in China, Germany, and the United States are helping assess preferences, trends, and concerns of more than 3,000 new car buyers regarding car data.

Consumer preferences

We set up customer clinics with our experts at LUNAR to understand user attitudes toward car connectivity features and services.

Cross-sector collaboration

We lead roundtable sessions for leaders from the automotive industry, including original equipment manufacturers, suppliers, and sales, as well as from the high-tech, insurance, telecommunications, and finance sectors.

Featured insights

Article - McKinsey Quarterly

Will car users share their personal data?

– Surveyed consumers in China, Germany, and the United States say yes, if they see value in return.
Report

Monetizing car data

– Cars generate data about how they are used, where they are, and who's behind the wheel. But how can industry players in the evolving... automotive ecosystem turn these data into valuable products and services?
Report

Creating value from car data

– Increasingly connected and autonomous vehicles will generate enormous amounts of data. Here’s what that may mean for consumers... and the industry’s business model.

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