McKinsey projects that more than 90 percent of vehicles sold in 2030 will be connected, up from 50 percent today.1 To capture the full value of this growing market, OEMs and other mobility players should consider the following three questions:
- What is the importance of connectivity for different customer segments, including those defined by region, demographic characteristics, and selected vehicle powertrain?
- How can OEMs and other mobility players create a winning connectivity offering (including attractive features, customer willingness to pay, and smart bundling)?
- How can OEMs and other mobility players maximize the commercial opportunity from connectivity through different payment models, such as one-time payments and subscriptions?
To support mobility players in the connected-car ecosystem, we recently surveyed more than 1,600 automotive customers in China, Germany, and the United States. The survey focused on 39 different features that could be part of a connectivity offering in six overarching categories: safety and security, comfort, autonomous driving, performance, infotainment, and assistant services. (For more information on the methodology, see sidebar “The McKinsey Automotive Digital Services Customer Survey: Methodology”). The survey findings allowed us to identify nine key implications that can help mobility players understand the current market, including regional differences, and capture the full value from connectivity by identifying features that consumers value, developing strong offerings, and setting the right price.
Why connectivity is important
Car buyers often prefer vehicles with strong connectivity, and the survey results reflected this enthusiasm.
How to create a winning connectivity offering
OEMs and other mobility players face a complex challenge when developing connectivity offerings because they must understand what customers in select segments want and what those customers are willing to pay. The bar for strong offerings is already high, especially in China, and will only rise higher.
How to commercially master the connectivity opportunity
Recapping: Winning the connectivity race
Winning the connectivity game requires several fundamental activities:
- obtaining a sophisticated understanding of customers, including how their needs differ across regions; behavior-based segmentation can help reveal such nuances
- developing features that strictly adhere to customer requirements
- adjusting current processes, including those for R&D, product management, marketing, and sales and services, while simultaneously shifting to recurring revenue models
- creating a strong commercial strategy that combines both sophisticated bundling and pricing in compelling offers and then ensuring that the value proposition is clearly communicated to customers and delivered through all sales channels