Capgemini tackles data analytics with new automotive insights laboratory
Capgemini has launched a new Automotive Insights Laboratory, a virtual lab that will use Big Data and analytics to help car manufacturers anticipate customer behavior. The service, part of the company's AutomotiveConnect offering, has already helped OEM clients improve customer targeting, boost warranty claims predictions and increase sales. It also could potentially impact the way automakers approach service.
"The industry needs to improve its ability to combine intelligence about vehicles and consumers to produce insights that can be actioned. Companies should, for example, be able to predict when a consumer will be looking to change their car, and what sort of car they are likely to buy," said Kai Grambow, global head of automotive, Capgemini. "Companies need to start treating data like the new oil powering this industry. Like oil, data can be difficult to find and extract, but becomes a hugely valuable asset once refined."
The lab uses data from macroeconomic trends, geographic habits, social media, and information provided from the manufacturers themselves to improve the development of business strategies, define customer service offerings and identify new opportunities. According to Capgemini, the lab has helped clients improve consumer profiling and targeting, renewal and loyalty, and enhanced predictions for pricing, demand and warranty claims.
According to Nick Gill, chairman of the global automotive sector at Capgemini, the Insights Laboratory evolved out of discussion about the influx of customer and vehicle data now available to automakers, and how to make the best use of it. "We are collecting all of this data to get to know the customer better, and collecting all of this intelligence from the car," Gill says. "What are we going to do with all of this massive, big data that we are going to collect?"
Automakers can approach the company with specific questions or problems, and have their own data mapped to economic and socio-demographic data, along with industry data from Edmunds, JD Power, and other sources. "We've been able to find some amazing things for several clients," Gill says. "In an industry where a one or two percent change is significant, we can come up with solutions that can influence results by as much as 10 or 15 percent."
Among the benefits experienced by clients using the service: campaign revenue increased through four-fold improved customer targeting; a 10 percent cost reduction via smaller target group sizes; doubling the accuracy of warranty claims predictions; and doubling or tripling of sales conversions via up-sell and cross-sell opportunities.
"You never have all of the data you want, but you often have more than you need," Gill says. "Many of our insights have come from public domain data. For example, we worked with an OEM on where to market electric vehicles. Just taking information about where people live, their environmental affinities, spending power, what types of houses they live in, all of these things influence the propensity for buying an electric vehicle. You can map that and not only say a certain type of person is likely to be a buyer, but you can focus on specific dealerships because of the qualities of the people living nearby."
So far, most of the projects have focused on the sales side: determining who might buy a new car, when they are likely to buy, and how much they would be willing to pay. Gill says that service is likely to be just as big an area of interest because it is a more predictable operation than sales.
"From the connected vehicle side, there are so many variables," Gill says. "If you have a problem, do you need to solve it immediately or defer it? You can develop some more menu-based services based on those client needs and consumer needs. There is a lot more we can do with the data on the service side that we are not doing today."
So far, telematics data has not played a large role, however. "There's actually very little communication between cars and hubs today," Gill says. "The insurance industry is probably doing more of it than the manufacturers. That's a wake-up call for the industry. I'm nervous that we may let the moment pass us by and other industries like insurance will seize the data opportunity ahead of us. Connected vehicles just aren't that connected today. Not many companies are leveraging that data a meaningful way."
The AutomotiveConnect line of offerings includes consulting, technology expertise and digital services. The Insights Laboratory is the key feature of the Connected Insights focus area, while the Connected Customer module helps manufacturers better segment their customers into the proper channels. The Connected Vehicle focus area keys in on telematics and consumer connectivity in the vehicle.
Gill says the auto industry will continue to grapple with data management as the number of vehicles on the road increases and the number of sensor points available expands.
"We're really at the beginning of a journey, and we're just now seeing what kinds of things we can do with the data," Gill says. "Most consumers are very happy these days to share data, as long as they trust the company and get a benefit from sharing the data. The industry can gain a deeper understanding of the customer and tailor services around that."
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