Connected cars are likely to be one of the first Internet of Things (IoT) applications to achieve true scale. Many connected vehicles are already on the road, and earlier this year Gartner predicted that by the end of the decade there will be a quarter of a billion vehicles equipped with this capability.
This opens up a whole new market for connected car products and services. Business Insider reports that revenues from connected services are expected to exceed $152 billion (£100 billion) by 2020, giving drivers and passengers access to features such as safety management and in-car entertainment.
A new report from BI Intelligence looks at the revenue generated by various connected car internet services, as well as consumer attitudes to these services and how they want to pay.
It reveals that safety is the most lucrative area for connected car services at the moment, already bringing in $13 billion (£8.5 billion). These features alert drivers to road conditions, such as severe weather or an approaching hazard, as well as collision-avoidance.
Entertainment features, such as integration with music streaming services and social networks, are popular but are not a major revenue driver, BI Intelligence said.
The research also found that only about half of those who have a connected car actually use the car’s connected features at present — but they show high levels of satisfaction with these features.
Thinking about how they want to pay for connected car services, one in four global consumers would be willing to receive in-car advertising if it meant they got free basic services in exchange. According to BI Intelligence, this suggests that marketers have a big opportunity to tap into the connected car market.
A recent article by Advertising Age looked in more detail at the opportunities for advertisers in the era of the connected car, highlighting the potential of in-car advertising as well as the entirely new set of consumer data that could be leveraged by marketers, such as real-world location data.
“The connected car, the first large-scale IoT platform, offers great promise to marketers — and a whole new way to reach consumers — at a time when they were previously reachable only on a very limited basis, such as with out-of-home or radio ads,” author Loren Hillberg said.
Tags: Internet of Things