Redefining premium in the data business
Talking Business – Key Facts
- Audi understands “consistently connected” to mean an open, digital ecosystem. The focus is on a seamless digital customer experience.
- The goal for 2025 is to achieve a connected vehicle share of 100 percent.
- Connectivity enables new digital services and business models both inside the car and beyond.
- The newly established Car.Software organization pools the software expertise of all Group brands and leverages significant synergies in the development of digitalized cars within the Volkswagen Group.
Predicting customer wishes
“For Audi, data is the basis for future, digital business models.”
There will be 40 times more bytes of data worldwide in the course of 2020 than there are stars in the observable universe.
1 In the future, connected data will govern increasingly larger parts of the value chain. What will generate the competitive edge in the future is not the most powerful engine or the most innovative composite fiber, but intelligently designed algorithms and new connectivity initiatives.
“For Audi, data is the basis for future, digital business models,” says Felix Schwabe, Head of Data-Based Business Model Development at Audi. “If we analyze and understand the data, we can identify customers’ wishes even more accurately in the future and derive new services and business potential from this information. This allows us to tailor our model portfolio and services precisely to different markets and individual customer requirements.”
Felix Schwabe and his team are responsible for the profitable design of new data-based business models and services. Their field of activity also comprises the proper functioning and implementation of digital services and their business models for vehicle data.
More connected data, less congestion and stress
Audi customers benefit not only from an optimized product portfolio, but also from significantly improved service and greater comfort. For example, they can choose to display the nearest charging station for the Audi e-tron or be informed and warned in plenty of time about local hazards such as black ice. Consistently connecting vehicles with their environment will also help ease traffic jams in the future. Even now, Audi drivers can use the
Audi Traffic Light Information service at selected traffic hubs in Dusseldorf, Ingolstadt or New York City to surf the “green wave.”
They can see in the instrument panel the speed needed to reach the next green light. That increases safety, soothes the driver’s nerves and protects the environment, since intelligent vehicle-to-infrastructure services such as this can improve the flow of traffic. For instance, it is conceivable that in the future cars will drive especially economically and “think ahead,” such as automatically choosing the ideal speed for maximizing a “green wave.” Green lights could also be incorporated into the optimum route navigation. All these steps contribute to the perspective goal of offering customers automated driving and thus freeing up valuable time – for work, entertainment or relaxation.
Connectivity creates synergies
“It’s about products that improve the customer experience, whether through entertainment services or parking navigation systems.”
We also use connected vehicles and the information gained from them for business models with other industries, such as weather and traffic services,” says Schwabe. “Additionally, it’s about products that improve the customer experience, whether through entertainment services or parking navigation systems.” The decisive factor here are the synergies that arise from their use throughout the Volkswagen Group. “Data-based business models only develop their full potential when they are used in a large number of vehicles. We are able to leverage this advantage thanks to the entire Group. That also gives us a competitive advantage over other manufacturers,” explains Schwabe.
Premium means data protection
The current Audi models send data to backends at Audi, where it can be automatically anonymized. For the first time with the Audi e-tron, several parameters such as speed or the use of assistance systems can be specifically obtained and analyzed. This information can then be incorporated into the product development process in the future. Data protection and security are the priority, which is why drivers should retain control over their data. Automotive security is also becoming increasingly important in this context, with an emphasis currently being placed on the areas of cybersecurity and software updates.
The main objective here is for manufacturers to introduce processes and mechanisms that protect the vehicle from cyber threats and guarantee that software updates can be carried out securely anytime and anywhere. Audi even goes one step further: In the future, customers at Audi will be able to benefit from the transmission of their data. In addition to receiving an extended range of services, the idea is that they will be able to use an app in the future to simply determine themselves which data is used and what it is used for. They may also possibly be able to receive incentives for certain uses. Schwabe: “With such offers, we are transferring our premium claim to digital business and are taking our customer orientation to a new level.”
Transformation in development
The company’s transformation is most evident in its adoption of digital business models: The development of digital products and services follows completely different rules than the development of vehicles. The life cycles of software are considerably shorter than those of hardware. New approaches are therefore being pursued for the development of digital products, such as supplying a minimum viable product. This minimum version of the product is then developed continually in the market in accordance with the state of the art. But especially in the field of occupant safety or as far as processing and protecting data are concerned, this is an inconceivable procedure for Audi. That is why Audi aims to find the optimum for these different approaches in the development of hardware and software. The primary objective is to combine the latest technology, the highest quality and inspiring design to create a compelling customer experience.