From Machine to Mindset: The Ripple Effect of Autonomous Vehicles
Brad Bowers, Product Principal
In 2009, Google kicked off a top-secret project, Waymo, to create an entirely new breed of vehicle. Led by the co-inventor of Google Street View, the Waymo team set out to do what no other company had done successfully: create a 100 percent autonomous vehicle.
In 2014, Google revealed a glimpse of the future of autonomous cars with its prototype vehicle lacking a steering wheel, gas pedal, or brake pedal — features most people typically associate with driving. The prototype came on the heels of an exciting announcement that Google’s self-driving cars had collectively driven 300,000 miles under computer control without a single accident.
What seemed like science fiction became reality virtually overnight. Car manufacturers began unveiling their own autonomous driving innovations in rapid succession. Nissan committed to releasing several driverless cars by 2020. BMW unveiled its autonomous i8 concept at CES 2016 and began promoting its driver automation under the banner of BMW iNEXT. Shortly after, Volvo announced its self-driving joint venture with Swedish supplier Autoliv.
As of 2017, companies have collectively invested 80 billion dollars in autonomous driving technology. Societal acceptance of autonomous cars is slowly but surely rising, a trend that shows no signs of slowing.
Although most experts predict that mass production of fully autonomous cars is at least another 15 to 20 years away, plenty of luxury vehicles today are equipped with semi-autonomous features such as lane departure technology and adaptive cruise control. Societal acceptance of self-driving cars is inevitable — and as consumers get cozy with the idea of cars that do the driving for them, it isn’t just the automotive industry that will be upended. Rather, it’s tangential industries that will feel the effects in more ways than one.
Media and Entertainment Behind the Wheel
This generation will push automakers to capitalize on commuters’ demand for entertainment behind the wheel. According to a report by The Center for Generational Kinetics (CGK), 22 percent of Generation Z consumers cannot comfortably spend an hour without accessing the internet. Sixty-one percent of that same subset said their primary online use is for entertainment — social and streaming media being the most common.
As car travel requires less attention from those in the vehicle, it’s unsurprising that commuters will want seamless access to their favorite streaming media and entertainment. In the short term, automotive behemoth Ford established a partnership with Amazon’s Alexa to begin offering connected experiences for drivers.
While for now it appears that the partnership will simply allow commuters to interact with Alexa from behind the wheel, this could set the stage for in-car shopping and even media streaming as autonomous cars require less and less direct control from drivers. That likely means extraordinary challenges for the radio industry as commuters swap from morning radio shows to their favorite Netflix series. Autonomous cars that offer both video and music streaming could be the final right hook that takes out the radio industry for good.
In the longer term, brand new companies are beginning to reimagine the driving experience in relation to consumers’ demand for constant connectivity. Just consider startup company Navdy, which aims to capitalize on consumers’ demand for uninterrupted access to media and entertainment with its heads-up display. Controlled entirely with voice commands, the “smart” windshield would allow commuters to view navigation, send, and read text messages and access their social media accounts without the need for a handheld device.
Marketing Goes Mobile
Unsurprisingly, in-car media will only continue to advance as drivers who are no longer preoccupied with operating their vehicles seek out entertainment to pass the time. This creates particularly intriguing opportunities for marketers and advertisers who now have the near undivided attention of a captive audience behind the wheel.
For Google — which arguably jump-started the autonomous driving revolution with its early R&D — more time and attention behind the wheel means yet another digital environment through which consumers can be served ads. Just as advertisers use browsing data to determine which ads to serve to which online customers, the same could be said for driving data gathered by increasingly sophisticated, connected cars.
This type of hyper-targeted advertising isn’t just on the horizon, either. In Australia, Lexus already sends targeted ads via digital billboards equipped with sensors that recognize the makes and models of cars approaching them. In the near future, sensors strategically placed along highways could serve targeted video ads based on a car’s make, mileage, or intended destination.
The Industry Ripple Effect Beyond the Driver
Of course, it’s not just commuters who will feel the impact of autonomous cars. Logistics and retail are both poised to transform as fewer and fewer cars are manned by human drivers. In fact, the rise of the autonomous truck fleet is already on the horizon as startup Embark completed its first fully autonomous coast-to-coast trip — nearly 2,400 miles in total.
In only a few years, autonomous trucking could mean drastically lower shipping costs for retailers, translating into much lower costs for shoppers as well. Faster, easier and more cost-effective nationwide logistics could mean a major uptick in online shopping and a bigger push for same-day and next-day shipping. For small businesses, this might require a pivot toward logistics companies that can offer the speed and simplicity of autonomous logistics in order to keep up with the likes of Amazon.
More autonomous cars on the road mean fewer accident-related industries; in the case of autonomous fleets on predetermined routes, no one is behind the wheel at all. Fewer accidents mean fewer injuries and fatalities — some experts estimate a possible 90 percent reduction in road fatalities thanks to autonomous cars.
Although this is good news for just about everyone, fewer accidents will have a major impact on insurance companies. Some recent forecasts indicate that the insurance industry could stand to lose $25 billion by 2035. With less need for accident-related repairs, insurance providers may need to consider pivoting to data protection and software security to maintain relevance for a new generation of consumers no longer concerned about costly accidents.
Getting Out Ahead
As autonomous vehicles become the “new normal,” it’s not just automotive brands that should expect a seismic shift in consumer demand. The rules of the road are changing for business leaders in industries as diverse as entertainment and media, logistics and retail as well. Those who don’t recognize the tidal wave of change headed their way aren’t likely to survive what comes next.
Although autonomous driving is still in its infancy, the time to prepare for the future is now. Just as carmakers must completely reimagine the consumer experience, so too should industry leaders well outside the automotive sphere.
Consumers’ expectations regarding the driving experience are already changing — automotive brands today will need to think bigger than behind the wheel. In this multi-installment series, we’ll continue to uncover how transforming expectations about the driving experience will alter both the automotive industry and society as a whole.