Digital Transformation at Enormous Speed
The automotive industry has been going through rapid changes. New technical possibilities and innovations, socio-political requirements as well as changing customer needs have a strong impact on the traditional set of regulations in the automotive industry. All areas are affected, starting with product development, production, distribution and the everyday use of the car by the customer.
As a result, the automotive industry is using the opportunities of digital transformation to better respond to the current and future needs of consumers. Examples of this are the digitalization of the supply chain with the help of blockchain technology, increasingly digital distribution, the development of voice-based vehicle assistants, multimodal mobility offers or “On Demand Car Functions“ (ODCF) in the vehicle that can only be activated for a fee if required. All the way to autonomous automobility, which will open up completely new possibilities of use for the vehicle as a "space": Work, media consumption or simply relaxation. The basis for all these scenarios is 5G technology, which provides the necessary data capacities for autonomous driving.
The ultimate challenge for the automotive industry will be to ensure that all digital transformation initiatives are planned from the beginning as part of an infrastructure and the overall business model and influence the key business processes. One major opportunity here is to redefine the relationship between OEMs and end consumer though digital channels, eco systems and considering this along the whole customer journey. At the same time the self-image of the automobile manufacturer is changing to that of a holistic mobility service provider.
Fast Changing Needs and Expectations Are Creating New Challenges
- Research shows that digital channels are already the primary information source for customers. This means there is potential threat of competition from online retailers, which puts pressure on the existing dealership structure
- Sales processes need to be updated and improved through digital transformations to fulfil customer demands
- OEMs and their respective partners will need to embrace new technologies like Artificial Intelligence (AI), Virtual Reality (VR) or Blockchain or otherwise risk losing their innovative ability and competitiveness
- Original Equipment Manufacturers (OEMs) need to separate themselves from their competitors. Hence, increasing investments in connected, autonomous, sharing and electric strategies are a necessary part of the digital transformation process
- Due to an increase in regulations regarding environmental and safety standards, OEMs and their partners will need to be able to anticipate these developments and resulting consumer trends
Digital-enabled trends and opportunities in the Automotive industry
Omnichannel: present and future opportunities
The traditional retail model is outdated, requiring retailers to enhance their online presence to stay competitive. Given that 35% of buyers utilizing more than 10 different touchpoints—both online and offline—to research their new car, brands must address their communication throughout all touchpoints, making omnichannel experience essential. While eletric vehicle (EV) buyers tend to prioritize online tools more than ICE buyers, most car buyers and EV buyers still plan to purchase their next vehicle from dealers, highlighting the continued importance of integrating physical and digital customer experiences
Consumer behavior, preferences, and expectations
As consumers' preferences and expectations evolve, car manufacturers must be prepared to completely restructure the mobility value chain. While demand for cars slightly decreasing in younger generations, there is a growing emphasis on a transition to EVs driven by environmental and climate concerns. Additionally, there is an increase in demand for personalized experiences, advanced features, and seamless integration with digital ecosystems. These developments reflect the broader trend of digital transformation across the entire industry, aiming to optimize both the customer experience and operational efficiency
The role of personal interactions for dealerships
With the rise of digitalization, dealerships face significant disruption. According to Google's Automotive Shopper Study, 95% of vehicle buyers leverage digital as a source of information, with twice as many people starting their research online compared to starting at a dealership. Aftersales services and personalized relationships can act as a significant lever for dealerships, providing consumers with a seamless and supportive buying journey. This approach significantly improves customer engagement and loyalty
Changes driven by the rise of shared vehicles & autonomous driving
Advancements in autonomous driving are creating new user groups with diverse transportation needs, such as increased demand for shared vehicles in urban areas and on-demand car use for specific occasions. As private car ownership and the number of drivers decline, these changes highlight the need for car manufacturers to explore opportunities in developing autonomous and shared mobility solutions
Our Expertise
As an experienced partner in providing digital transformation solutions, we identify, analyze, and evaluate digital targets and their potential, as well as performance improvement opportunities. We combine our exceptional capabilities in digital strategy, operations, technology, and digital marketing and leverage our cross-functional automotive experienced team. Based on well-researched and integrated data analysis, we cover all aspects of a highly customized digital transformation.
Our international team has assisted >2,000 projects in digital strategy, digital operational excellence, data science, and transaction advisory services. With a team that speaks over 20 languages, and a 50% female-male ratio, we ensure both effective communication and representation throughout the advisory process.
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How We Help Our Clients
DAL: Harnessing the power of clean tech
Deutsche Leasing Group (DAL) is Sparkassen-Finanzgruppe’s center of excellence for leasing, factoring, and other alternative forms of financing, with around € 12 billion of assets under management and new business of around € 1.65 billion per year. Deutsche Leasing Group is the solution-oriented asset finance partner for the German SME sector, supporting investment projects in Germany and other countries and offering a wide range of financing solutions & services. OMMAX supported DAL during a credit transaction review for a large CleanTech client with the technical assessment of a high-power charging (HPC) station concept to be rolled out in several hundred installations across Germany.
The MG Motor Case
OMMAX assisted MG Motor with their launch into the German market by establishing a digital go-to-market and lead-generation strategy and implementing the digital infrastructure. Additionally, OMMAX created a digital channel approach for MG Motor and produced high-quality content for all digital channels.
- Successful entry into the German automotive market
- Development of digital infrastructure including a holistic digital marketing running engine
- 140% YoY growth
- Outperformed competitors in electric vehicle sales in H1 2023
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