Dealerships, Market Reports, Marketing, News, Technology ,

SERIAL data innovator and entrepreneur Mark Lancaster has unveiled a remarkable electronic automotive ecosystem that provides an ongoing revenue stream for dealers, cash benefits and discounts for vehicle owners and sales and marketing opportunities for participating auto (and non-auto) services providers.

Called Connected Vehicles, the service revolves around dealerships initially electronically linking their customers into its system via a vehicle health monitor. From then on, every time the customer buys from one of the participating goods or services brands, the dealer gets a share of the purchase amount.  

Wherever that customer goes in Australia and buys from a participating vendor, the dealer gets a cut. Mr Lancaster told GoAutoNews Premium that according to projections calculated by Pitcher Partners, some dealer groups can benefit from putting most of their customers into the scheme to the tune of some tens of millions of dollars a year. 

The average dealership can generate a million dollars a year if most of its customers are signed on to the system.

Take fuel for example. The car owner signed into the scheme benefits from a five cents a litre discount. This is estimated to be worth a saving of hundreds of dollars a year for the owner. 

The fuel retailer benefits from a new and ongoing customer and the dealer who introduced the customer to the Connected Vehicles ecosystem gets a share of the fuel sale via direct revenue back to the dealership. 

For example, if the cashback is say four cents a litre, Connected Vehicles will have been able to negotiate a five cents a litre cashback. One cent of that transaction will go back to the dealer. 

Effectively this goes on for as long as the vehicle stays connected.

The same applies to vehicle service and repairs, car wash, tyres, batteries, windscreens, pay-per-use insurance, roadside assistance, body repairs and even a wide range non-automotive lifestyle purchases from apparel to travel. Mr Lancaster said there are about 1000 lifestyle partners.

He told GoAutoNews Premium: “Our innovative connected vehicle health monitor not only enhances the driving experience by offering cash-back rewards at over 1,000 merchant partners but also aims to significantly boost dealership retention. 

“This program fosters a deeper, more beneficial relationship between consumers and dealerships by providing an enticing option: customers can direct their cash back rewards towards vehicle maintenance. 

“Opting for this choice can drastically reduce, and sometimes even eliminate, maintenance costs, creating a compelling incentive for customers to return to the dealership. 

“This unique feature not only ensures customer satisfaction through financial benefits but also cleverly secures customer loyalty by making the dealership an indispensable part of their vehicle’s upkeep and care,” Mr Lancaster said.

The core of the technology is a ‘health monitor’ fitted to the onboard diagnostics (OBD) connection under the vehicle facia. This maintains a Bluetooth link to the Connected Vehicles mobile app within which the owners manage their details. 

Further, to avoid having the potential inconvenience of a separate charge card, the owner’s credit or debit card is linked into the Connected Vehicles system. This also means they do not have to open the app to claim a benefit. 

Whenever a purchase is made from the owner’s regular card with a participating partner, anywhere, the card flags the purchase and allocates any discount etc to the owner’s Connected Vehicles account. 

Owners therefore do not have to stay on top of which vendors are participants or not. The system does this automatically for them even if the owner is not aware that the vendor is a Connected Vehicles partner. So in the back end the owner is accumulating cashbacks based on their normal shopping activities.

Throughout this process the shared revenue generated by each purchase is forwarded to the dealer.

Discounts, cashbacks and bonuses for the owner are stored in their own account in the app and managed through the app. Owners can elect to use any credit they have accumulated to pay future purchases with participating vendors or withdraw the money into their own pockets. 

In particular, the owner can choose to hold all their cashback to pay for future maintenance expenses back at the dealership, to cover fully or partially their future servicing. This is a recommended setting in the app, and can be reported back into the dealer’s dashboard.

There are however two more key elements to the ecosystem. One is that it monitors a wide range of vehicle operations for its owners and flags service and maintenance issues and books appointments to have those issues corrected. It can alert for tyre wear, battery replacement, recalls and a range of other configurable conditions, such as finance parity and insurance premiums. 

Getting the attention of owners in this way leads to purchasing. The goal of the app is to provide genuine utility to the owner to hold their attention on a regular basis (through rewards), whilst promoting reminders for servicing and other dealer services such as trade-in opportunities and new car sales.

Along with this is the fact that it provides the dealership with a helicopter view of its entire customer database once the dealerships have signed up the majority of their customers to the system. 

The mobile app and dashboard displays a dealer’s entire customer book and unlocks increased customer lifecycle purchases and grows service retention. 

Mr Lancaster said: “Dealers get a live dashboard where they can genuinely see their entire car park; this is how many customers they have, how many of them have devices? How many are in their PMA?  How many are not.  

“And then how many engine lights have come on, how many vehicles are due for a service that they haven’t booked in for a service yet. How many vehicles need tires or recalls or batteries.

“So how much money is still sitting on the table?” Mr Lancaster said.

Connected Vehicles says that its various services include: 

Live Car Park Dashboard: Shows every car in a dealership in real time. Alerts dealers when engine faults are detected and vehicles need repairs, maintenance or servicing

A.I. Communications: AI assistants will automatically reach out to customers, engaging them for repairs, recalls, batteries, tyres and servicing. AI automatically makes appointments. No need for the customer to ring.

DMS Integration:  No duplication of data entry. AI assistants create appointments directly into the DMS.

Mobile App: Every customer gets a mobile app to control their connected vehicle, automate their service bookings, manage their aftermarket purchases, and secure their vehicle. The app allows dealers to communicate with them with timely notices and lifecycle promotions.

Service Retention: Connected customers are much more likely to retain the service schedule with the dealership. The automated AI assistant will ensure the best possible retention through tailored, consistent communications with the customer.

Other Connected Vehicles features for owners are automatically generated tax logbook, crash detection, remote access to fuel levels (do I have to allow time to buy petrol today), trip planning, geo-fencing (alerts when children arrive safely), driving style scoring and theft reporting.

Mr Lancaster said Connected Vehicles charges the dealer a once-only fee of $35 for the vehicle health monitor plus a monthly fee for each dealership. 

He said the early indications are that dealers will elect to fit the monitors at no cost to the owners in order to accelerate the uptake of customers signing on to the system. The health monitors can be fitted to vehicles going back to 2007.

Mr Lancaster said the development of the system would help the industry monetise the data it generates and to offset the lower revenues that will flow from EV service.

Mark Lancaster

“The challenge for dealers is they have never, ever been good at commercialising their data. We have lots of data that dealerships capture every single day. Yet, other than a service reminder, we, as an industry, are really poor with what we do with that data let alone commercialising it. 

“The other potential problem is EVs. With EVs coming, an average dealer in Australia is going to have to find another million dollars in service income a year. 

“”Imagine the big groups; we are talking tens of millions of dollars a year that they’re potentially at risk as EVs come along. Dealers need to be proactive about that now and be ready. So the dealers will make sure that every one of their customers download the app. 

“And then every consumer is looking at our marketplace benefits. They are getting a discount for doing what they normally do. We just follow them around in the background and if there’s cashback available, we get it on their behalf. 

“They are automatically going to get money coming back into their account. A lot of retail stores offer cashback, but a lot of people are not registered for them. So we’re going to do that on their behalf all of the time.” 

Mr Lancaster said that it is in the dealers’ best interests to get as many customers on the system as possible because the more owners, the better the commercial power they have to attract even bigger discounts and cashbacks. The owner gets the cash discounts and the retailers get more customers. 

“Everyone wins. Everyone is getting something that they wouldn’t have necessarily got on their own.” 

Mr Lancaster said that dealers selling cars interstate or where they are unlikely to see the car again for service can still benefit by signing up the owner before the car is shipped because it will still generate revenue every time it is serviced or new tyres and batteries are bought. The selling dealer still gets a payment for that transaction.

“But the major thing is the engagement and retention of customers in service,” Mr Lancaster said. 

“We bring services forward. We close the loop as far as increasing retention because dealers can be proactive. At the moment it is say 12 months or 15,000km but the dealer has no idea if you have done 15,000km or not. So we send out a standard message in 12 months time.

“But we can see that this driver will cover that 15,000km in just seven months and we can alert them that the first service will actually be in seven months.  And then we can make it really convenient to book that service,” Mr Lancaster said.

By John Mellor

AdTorque Edge