With the 2024 Paris Summer Olympics now behind us, I pause for a moment to reflect on a time when the last summer games were held in Europe. The year was 2012, and the Olympics had just wrapped up in London, the queen had celebrated 60 years upon the throne, and in true royal fashion, I had just purchased the latest Ford Explorer.  

This Ford Explorer came in Triple Black with every feature including the latest version of sync with voice control. I was giddy with excitement and felt like I was Captain Kirk at the helm of the Starship Enterprise steering towards new horizons. But… the voice activation was not what I had hoped for.  

When attempting to call my mother, I got my friend Monica, and when trying to dial a colleague, I received a childhood friend. If you know me, then you understand that navigation isn’t my strong suit, and when searching for directions to Birmingham in Michigan, I would consequently be sent to Alabama. You get the picture.  

Speed back to 2024 and voice-to-everything is transforming the automotive industry. Thankfully, the voice control in my 2023 Ford Edge is now working much better — the way it was intended. 

Voice-to-Everything Technology Allows for Expanded Vehicle Control  

The automotive industry is undergoing a significant transformation driven by advancements in technology that are reshaping the way we interact with our vehicles. One of the most exciting developments in this space is the rise of voice-to-everything (VTE) technology. This innovation is poised to redefine the driving experience, increasing intuition, safety, and making it more connected than ever before.  

VTE technology refers to the integration of voice-controlled systems throughout a vehicle, allowing drivers and passengers to interact with the car’s functions using simple voice commands. This technology leverages advancements in artificial intelligence (AI) and natural language processing (NLP) to understand and execute spoken instructions, minimizing the need for physical controls or manual inputs. In essence, VTE in automotive transforms your voice into the primary interface for controlling the vehicle, including everything from adjusting the climate controls, to navigating to destinations, or even managing entertainment options.  

Just Like Language Itself, Voice Technology Has Evolved Over Time 

The Evolution of VTE in cars isn’t entirely new, but it has come a long way from the rudimentary systems of the past. Early voice-activated systems often struggled with accuracy, limited vocabulary, and rigid command structures. However, recent advancements in AI and machine learning have dramatically improved these systems, enabling them to understand context, recognize natural speech patterns, and respond accurately even in noisy environments. Modern vehicles are now equipped with sophisticated voice assistants that can manage a wide range of functions. These systems are no longer just limited to basic commands; they can engage in complex interactions, understand conversational language, and even learn from user preferences over time. 

How Voice-to-Everything is Transforming the Driving Experience

The integration of VTE in vehicles offers several significant benefits, fundamentally changing how drivers and passengers interact with their cars.

To begin, VTE makes the driving experience more convenient and user-friendly. Instead of fumbling with buttons or touchscreens, drivers can simply speak their commands. This ease of use is particularly beneficial in complex, multitasking scenarios, such as driving in heavy traffic or during long trips. Modern VTE systems can learn from the driver’s habits and preferences, offering a personalized experience. For instance, the system can remember your preferred routes, favorite radio stations, or climate settings, automatically adjusting to your preferences as soon as you step into the car. 

Further, as vehicles become more connected, VTE plays a crucial role in integrating the car with other smart devices and services. Drivers can use voice commands to interact with their smartphones, smart homes, and other connected systems, creating a seamless experience that extends beyond the vehicle.

This hands-free approach is not only more convenient but also significantly enhances safety by reducing distractions.  By enabling drivers to control various functions without taking their hands off the wheel or eyes off the road, VTE greatly enhances driving safety.  Whether it’s making a phone call, changing a song, or setting up navigation, voice commands allow drivers to stay focused on the road. An additional benefit is increased productivity during long commutes, which significantly improves the driver experience. 

Finally, VTE is paving the way for the future of autonomous driving. As cars become more autonomous, voice commands will likely become the primary mode of interaction between the driver and the vehicle, allowing for smooth control of the car’s functions even when manual driving is no longer required. 

Let’s Drive Towards a Voice-Powered Future Together 

Voice-to-everything is rapidly becoming a cornerstone of the modern automotive experience. By making driving safer, more convenient, and more connected, this technology is set to revolutionize the way we interact with our vehicles. As it continues to evolve, VTE will play a crucial role in shaping the future of transportation, bringing us closer to a world where the sound of our voice is all that’s needed to command the road. Just to be clear, I am not yet ready to include my vehicle in my friend group, or as part of my fantasy team, but it’s clear that the voice-driven car is more than just a concept—it’s the future.  

As I’ve mentioned in a previous blog, Perficient is in the middle of conducting primary research on connected products. We also have a robust innovations lab that routinely helps OEMs with their customer experiences, data needs, and cloud infrastructure.  Please explore our automotive expertise and schedule a meeting, as we would love to discuss how we can help create a sustainable competitive advantage for you. 

Connected vehicles are no longer the future. They have become the present. This year, our team is conducting connected products research in which we are collecting insights from consumers, commercial end users, and manufacturers. The reason? Almost every manufacturer is working on providing connected products and solutions for both their consumers and their businesses operations. With that initiative comes challenges with leveraging huge volumes of data and questions about how companies can create revenue opportunities that still generate significant value for the consumer. 

Our research spans many industries, but I wanted to focus in on how connectivity is uniquely playing out in the automotive industry. This industry is on the brink of a technological revolution, and connected vehicles are at the forefront of this transformation. As the world becomes increasingly interconnected, the cars we drive are no exception. Today, cars are not only becoming sophisticated, but also becoming data centers on wheels. With advanced sensors and constant internet connectivity, connected cars can communicate with other vehicles, infrastructure, and even pedestrians. This interconnectivity promises to enhance safety, efficiency, and convenience. 

Explore Our Connected Vehicles Strategy Position

Will Promises of Value Outweigh Privacy Concerns? 

Proponents argue that connected vehicles will significantly reduce accidents through real-time data sharing and advanced driver assistance systems (ADAS). Imagine a world where traffic lights communicate with cars to optimize traffic flow, or where a vehicle can warn its driver of an impending collision long before it happens. The value of these interactions for drivers and their communities would be life-altering.  

However, this connectivity raises serious privacy concerns. With cars collecting vast amounts of data on our driving habits, locations, and even conversations, consumers are wondering who has access to this information and what is being done with it. For manufacturers, the questions must be asked: are consumers being fully educated on their data and how it is used? Are they getting value from their data being collected? Are consumers going to resist the full adoption of connected vehicles if they do not feel entirely comfortable with this transaction of privacy for value? 

Securing Consumer Data Is the Pathway to Adoption 

The whole question of data privacy is critically important. There are regulatory and compliance issues with data, and the impact goes way beyond the consumer and their vehicles. For OEMs, the goal must be bigger than just monetizing the data. The data must be leveraged for the consumer and provide value to them as well. The consumers need to get value from their data in terms of benefit to them, their fellow consumers, and the larger community.

The promise of connected vehicles is undeniably exciting, offering unprecedented safety, convenience, and efficiency. However, we must tread carefully. As we move towards this connected future, it is crucial that we address these challenges head-on, ensuring that the benefits of connected vehicles do not come at too high a cost for consumers.  

The future of the automotive industry is here, and it is connected. OEMs are busy getting ready for a connected future along with managing vast data opportunities and issues.  

Ready to connect? Reach out to discuss how our expertise in the automotive industry can help your brand forge the future of connected vehicles. 

There is an untapped potential for automotive loyalty programs, and we are living in an era where customer loyalty is more fleeting than ever. Until now, the relationship between OEMs and customers has been largely transactional. A customer buys a car, and the interaction ends there until the next purchase cycle—typically five to ten years later.

But in today’s competitive landscape, this model is no longer sufficient. Customers expect ongoing engagement and value from the brands they choose.

The way forward is to build innovative loyalty programs beyond the usual incentives to create genuine brand advocates. The power of loyalty programs has proven successful in other industries, from airlines to retail. They create a sense of belonging and reward customers for their repeat business. However, the automotive industry has been slow to adopt comprehensive loyalty programs.

This needs to change, and here’s why.

Why Does Loyalty Need to Change?

Three major desires of OEMs and customers are changing the face of automotive loyalty:

1. Increased Customer Retention – It’s significantly cheaper to retain an existing customer than to acquire a new one. Loyalty programs can keep customers engaged between purchases, ensuring they return when it’s time for a new vehicle.
2. Higher Lifetime Value – Loyal customers are likely to spend more over their lifetime, not just on vehicles but on related services such as maintenance, accessories, and upgrades.
3. Enhanced Customer Experience – A well-designed loyalty program can improve the overall customer experience, leading to higher satisfaction and positive word-of-mouth.

Crafting the Ultimate Loyalty Program

To create a successful automotive loyalty program, manufacturers need to think creatively and holistically. Here are key elements to consider:

1. Tiered Rewards Systems – A tiered system encourages customers to strive for higher levels of rewards. For example, a basic tier might offer discounts on services, while higher tiers could include exclusive access to new models, VIP events, or even free maintenance packages.
2. Personalized Experiences – Leverage data to understand customer preferences and tailor rewards accordingly. Personalization can range from targeted service reminders to custom offers based on driving habits and vehicle usage.
3. Integrated Ecosystems – Create an ecosystem where customers can earn and redeem points across various touchpoints—dealerships, service centers, online stores, and partner businesses. This integration makes the program more valuable and versatile.
4. Community Engagement – Build a community around your brand. Organize events, create online forums, and encourage social media engagement. Customers who feel part of a community are more likely to remain loyal.
5. Seamless Digital Experience – Ensure your loyalty program is accessible and easy to use via a mobile app and online portal. Customers should be able to track their points, redeem rewards, and access exclusive content with just a few clicks.

Several automakers are already pioneering in this space. For example, Tesla is known for its referral program, as it rewards customers who refer new buyers with exclusive perks including early access to new models and significant discounts. The BMW Loyalty Program also offers a range of benefits, from special financing rates to personalized gifts and invitations to exclusive events. Further, Hyundai Rewards allows customers to earn points for vehicle purchases, service visits, and even test drives, which can be redeemed for future purchases and services.

The Road Ahead

The future of automotive loyalty programs is bright, but it requires a shift in mindset. OEMs must move beyond the traditional sales cycle and invest in long-term relationships with their customers. By doing so, they can turn one-time buyers into lifelong brand advocates, driving sustained growth and market leadership.

By fostering deeper connections with customers and offering meaningful rewards, OEMs can ensure that their brands remain top-of-mind and top-of-choice. The journey to loyalty starts now. Are you ready to take the wheel?

The Perficient automotive team would love to hear your thoughts and help you to build out a world class loyalty program that gives you a sustainable competitive advantage in the marketplace.

It is an honor and privilege to impact another person and make their lives better with more opportunities, and the Time for the Children Event Gala in Detroit is one of the greatest examples. I was able to attend this event last week with my colleagues and support an organization called Friends of the Children which is making generational impacts with at-risk children in the city.

Friends of the Children

Friends of the Children’s mission is to support at-risk children throughout their school years by setting them up with a mentor who follows them all the way to their high school graduation. With a mentor by their side, these children grow into successful young people who graduate, enroll in further education, get jobs, stay out of trouble, and deliver change to their entire families. It’s all about mentorship and love.

This organization reinforces how mentorship and guidance are essential for unlocking the full potential of our youth. Mentors can provide young people with the guidance, support, and feedback they need to turn their ideas into reality. The years leading up to high school graduation are key developmental years that greatly benefit from advice about navigating life from experienced and trustworthy people. Beyond advice, these mentors can also share their networks and connect young people with relevant resources and opportunities.

The Power of Mentorship and Support for At-Risk Youth

The highlight of the event for me was the Caregiver Spotlight, which gave well-deserved recognition to Tori Scheday, a woman who stepped in without hesitation to raise her daughter’s three children. I was touched by her story of how she and her husband quickly rose to the occasion to take care of three children who would become successful, confident, and well-adjusted young people. It is wonderful that the Friends of the Children in Detroit supported them along the way – they never had to be alone.

At Perficient, we’re deeply committed to supporting organizations like Friends of the Children in Detroit because of our strong desire to make a difference in all the communities in which we live and work. I’m delighted that this is our second year of sponsoring the Time for the Children Gala and being able to attend and participate, especially because I can see myself in so many of these children with limited means and guidance.

I had parents who had to prioritize work to keep our household going and did not pursue any higher education. My father had an eighth-grade education, so he taught me to work hard but could not guide me in pursuing further education. Most of my peers also were lost with no direction and no guidance. My way to success was to find a mentor of my own – though not in person. Vince Lombardi, the legendary Green Bay Packers coach, became my role model as I read about him and channeled his spirit into my schoolwork and activities. I never had the opportunity to meet him, but I imagine he would demand excellence in both academics and athletics and so I applied maximum effort to everything that I did.

My parents thought it was odd that a nine-year-old boy would be making his bed, doing his chores without being asked, getting straight A’s, and was the athlete who was always early to arrive and late to leave.  I will tell you, though, that it was the impact of my mentor Vince Lombardi – the impact of having guidance from someone who knows how to become successful.

So, of course, I understood that feeling of hopelessness and confusion due to a lack of guidance. I can empathize with the feelings of seeing so many of my peers being lost to drugs or prison. I am so grateful that there is an organization out there stepping in to guide and support these children who are going through such hardship.

A Tribute to The Great Motor City

There was no better way to close out the night than to celebrate this great city with a performance from the youth choir. The children sang many Motown songs that made us all feel proud of the great city of Detroit. It was also great seeing many leaders in the automotive industry participating and showing their support.

One of the leaders at General Motors spoke about his story, explaining how someone mentored him at college and suggested he go to a job fair where General Motors was interviewing. This mentor bought him a shirt and tie and prepared him for his interview, which would become his first step in a journey towards becoming Vice President at Cadillac. By his own merit, he is a great leader in the automotive industry today, but it was because someone believed in him that he was motivated to take that leap of faith.

Overall, this event reminds me that the time, attention, effort, and money you offer to someone else could not only impact that one person, but everyone who interacts with them. I had a great time with my teammates, and as a bonus, I learned that Lomas Brown (ex-offensive lineman for the Detroit Lions) is a wonderful and kind human and that his hand can swallow my whole arm.

Thank you Friends of the Children – I look forward to diving in and doing even more with your organization in the future!

The Marconi Automotive Museum in Southern California was the perfect backdrop for our roundtable event, during which we discussed the evolution of brand loyalty with leaders from several of the world’s most influential automobile manufacturers.  This is an important topic for the automotive and mobility industry, one that is front and center as emerging technology is creating new opportunities to improve customer experience and build stronger, more personal relationships with customers. With over $80M of exotic and rare automobiles surrounding us, the discussion felt even more special.   

Evolving Consumer Preferences and Emerging Tech

Today, OEMs spend billions of dollars building loyalty programs and thinking strategically about omnichannel customer experiences. All the hard work poured into that process can be undone if the dealership is still thinking in a transactional way.  At the same time, it’s important to remember that dealerships think in terms of transactions because of the way they are incentivized.   

We also discussed how consumers and their buying habits are changing.  Automotive purchasers no longer mainly consist of Baby Boomers and Gen X, but rather of Millennials and Gen Z. These younger generations have spent most, if not all, of their lives depending on computers and smartphones. A “Netflix” and “Amazon” effect is taking over consumer behavior, and the automotive industry will not be saved from the implications. These folks want a different experience built around their needs, not the outcomes of an incentive plan. 

The vehicles have also evolved, no longer differentiated by performance but by their software and connected capabilities.  

Brands Must Be Loyal to their Customers

I was pleased to find that the OEMs are building business cases and asking the right questions about how we can help the consumers.  Lasting relationships are two-way streets; we can no longer define brand loyalty as only a customer’s loyalty to the brand.  One of my favorite comments during the event from a major OEM was that we need to think not only about what the OEM wants for lifetime customer value and loyalty but also what our customers want and need. 

Solving the “Loyalty Dilemma” is an inflection point in automotive. What problems are we solving?  Are they the right problems? What is the generational impact of this solution?  Those are just some of the questions that over time we will answer.  Industry changes, consumer needs and preferences change, and it is time that all the players in the industry lock arms and address this challenge.  I love our clients who participate in the roundtables because they want to be changemakers in our industry. Sure the solution to lifetime customer value has ROI benefits for the OEM, but it also dramatically changes the relationship with their consumer.

At Perficient, automotive expertise helps clients achieve their goals, disrupt the industry, and accomplish things that give them a sustainable competitive advantage.  Let’s connect -I would love to continue the conversation and create something that helps improve your customers’ lives.

Last week, I had the privilege of attending our Accelerate Conference in St. Louis where I learned that Perficient’s secret sauce is really our people. We are a global digital consulting firm competing against the largest consulting firms in the world – and yet, we stand out.

We heard from a couple of our largest clients who spoke about the groundbreaking work we are doing together.  I got goosebumps when I heard that the work my Perficient teammates are doing is helping people live better lives. As part of the top ten consulting firms in the healthcare space, we are even improving the world in ways that can be the difference between life and death. This aligns well with our new vision: “to be the place where great minds and great companies converge to boldly advance business.”

Our entire leadership team was at the conference, and we got to hear from our CEO, Tom Hogan, as well all the SVPs and AVPs leading critical areas of our business. The key component to all their talks was really about the quality of work the team is doing, the impact we are making on the world, and the huge opportunity in front of us to serve our clients in the Perficient way: creating a sustainable competitive advantage. We reviewed case studies and applauded outstanding performances, but we also took time to celebrate each other and the rest of our 7,000 teammates around the globe. I was proud to have even gotten an awesome mention from our SVP of Marketing, Bill Davis, who used my “one team, one mission” mantra.

Personally, I am extremely proud to be a member of our Digital Strategy team as the automotive industry lead. The team is off the charts in terms of intellect and accomplishment, but also in terms of kindness and that “one team, one mission” thinking.  We are brothers and sisters who support each other with kindness and love, but aren’t afraid to also challenge each other to think harder and work smarter to create even better solutions, especially in automotive.

I was touched when an individual or team won an award and the whole room joined in the excitement. There was applause and pats on the back, and they were all just as happy as if they won the award themselves. That moment, when individuals become a team, is the moment that you know you are in a special place.  I am humbled and honored to be part of a team where the only wins are team wins.

Finally, while we do get to see some of our teammates on the regular, there are other teammates that we have not seen yet. Our company spans the globe, with the best talent from several continents. The conference was moving because it was a place for us to all finally come together, build real connections, and even exchange handshakes and hugs along the way.  All of this was confirmation for me that Perficient may not be the largest company in its space, but it is certainly making the largest impact.

Of course, this is all still just the beginning.

For the second year in a row, I spent an evening with my colleagues at the University of Michigan’s Ford Robotics Center in Ann Arbor to celebrate MRacing’s unveiling of this year’s EV. It did not disappoint – it was a beauty, designed with the look and feel of a Michigan football helmet, including the blue and maize figured prominently. I spoke to team members from all over the world, and I knew very quickly that these young men and women are the future leaders in engineering and robotics. They will be the ones who lead our great automotive industry into this new technological world.

One of the things I love most about working at Perficient is the passion to give back to our communities and support things that are way bigger than us. We are committed to not only serving our clients, but also serving the whole automotive industry. Last year, we sponsored eight schools around the country who were giving young automotive engineers the opportunity to build their own vehicles and compete all around the world. The program, named “Electrifying the Future of Automotive,” was so successful that, this year, we decided to not only continue but expand our program to include thirteen schools, some of which were international.

The University of Michigan is a fantastic school that is near to my home and place of work, so it was a no-brainer for me to revisit this year. There is nothing that fills my heart more than talking to these young folks on the University of Michigan Formula SAE team – they are all managing components of the vehicle and program, learning much more than just about the engineering of the vehicles. Each year, the team elects a captain as well as leaders for all the different areas of running the program and building the vehicle. More than anything, though, it is amazing to see how this program fosters their ability to function as a team. They are learning to work together without the silos and weight of industry history, which, at times, inflict the larger automotive industry. Rather, they see the endless possibilities of the future.

This unveiling is one of my favorite events to attend for the year. I love talking about the future of automotive with the people who will one day be leading the industry. For me, it is a chance to brainstorm about sustainability and customer experiences and recognize that, even with vastly more distractions around, automotive enthusiasm is still a massive cultural phenomenon.

As I was heading back to my car to drive home, I turned back for one last look at the Michigan team – a team of young people whose bright future and talents will take us very far. I felt an intense pride that the Perficient leadership is so supportive of our automotive practice and partnering with the universities who are participating in Formula SAE. We can support the future of automotive with more than just our innovative solutions to serve our clients. These thirteen sponsorships serve the future leaders, thinkers, and doers in the automotive industry and creating generational change.

A sustainable competitive advantage in the automotive industry starts with building a foundation for the future, and that’s the Perficient automotive speciality.

This is a very personal blog for me, but I think it is important to write from the heart.  I am a huge believer that each experience we have shapes our lives and our thoughts.  A few years back while I was at Global Team Blue, I had the privilege of working with the Ford Dealer Association Funds (FDAF) and that gave me the opportunity to work with Ford clients as well as many of their dealer bodies all over the country.

The FDAF is a group of dealers that are focused on regional marketing.  They operate as a Board and represent the Ford dealers in their regions. My role was to help them with their digital marketing, provide an industry perspective, and lead all their war rooms.  I had the honor of meeting dealers all over the country, and in some areas, I became a regular fixture in Dallas, Pittsburgh, Carolina, New England, St. Louis, Tri-State, and Southern Virginia. I learned so much about automotive from these great connections, spanning perspectives from the manufacturers to the dealerships.

One of the groups that I became close friends with was the Pittsburgh FDAF.  I think in some ways, being in the Pittsburgh District was a lot like being home for me. Those dealers were very successful, but they had to work their way up. They were strong, humble with absolutely no pretense – a handshake was a contract to them. They brought me back to how I was raised and aigned to my blue-collar roots. Through the years, I got to know all the dealers on the FDAF very well, and I even visited their dealerships to talk to their staff about digital marketing, customer experience, and how they can generate a sustainable competitive advantage for their dealers.

I regularly keep in touch with these dealers and their spouses — they have become extended family.  It was during one of these routine check-ins that I learned of the passing of Mark Smail.  Mark was the leader of the Smail Automotive Group, and he was loved by his fellow dealers. I had the opportunity to spend time with Mark at one of his dealerships holding a digital marketing workshop with his team. Mark was tremendously successful yet so modest, he taught me a lot about what dealers needed and how they could leverage technology better.  I always looked forward to spending time with Mark and his wife Kelly at the Pittsburgh Auto Show, sports events, and the outstanding holiday parties we had each year.

Mark had an infectious smile and an understated approach in our Board meetings.  He debated ideas, but never people. We did great things together in our War Rooms and were able to go to market smarter.  I remember having intense life conversations with Mark at some of our happy hours and alone time.  I am going to make a point to drop by one of Pittsburgh District’s FDAF meetings and talk about the automotive industry.  Mark’s passing was sudden, and I did not get a chance to tell him how much I appreciated knowing him and having him in my life. Mark’s father, Bud Smail, was a close friend of my father-in-law Jim O’Connor, and it was a great conversation over lunch one day when we both realized that connection.

Mark lived his life well and built a beautiful family, he also treated his team at the dealership, fellow dealers, and his partners with grace and friendship. Mark was both a great and good man and he will be missed by the entire automotive community.  I am a better person and automotive strategist because of Mark and the rest of the Pittsburgh District FDAF.

Humbled and honored to know so many outstanding dealers who play such an integral part of the customer experience in the automotive industry.

When we conducted our electric vehicle customer journey research last year, we confirmed a commonly held belief in the United States: most people aren’t happy with their dealership experiences, specifically as it relates to aggressive sales tactics. Automotive customers desire experiences and service centers that meet their needs, listen to their concerns, and provide a comfortable environment to explore vehicles at their own pace. OEMs are putting a greater emphasis on the customer experience, whether online or at the dealership, than ever before, but are we thinking about this priority the right way?

No longer are demographics of automotive shoppers dominated by the Baby Boomers and Generation X folks. The largest group of shoppers are now Millennials and Generation Z, both of which had access to computers, handheld devices, and subscriptions services for a significant part of their lives. However, when I think of an iconic experience that has touched a majority of these shoppers and changed their expectations for all other experiences, I think of Apple and the experience at their stores.

The Apple Store Difference

I remember walking in a mall and comparing the Microsoft store to the Apple store. What a huge difference in customer experience. Microsoft was a typical mall store, which had nothing really wrong with it, but it held no candle to Apple’s stores.

The Apple store is an experience where customers would not only transact to get products and services, but also engage with the products and staff. The staff was extremely educated about all the products, and their job was to guide customers to experience the products and learn more about them, focusing less on the aggressive sales tactics that many other stores implemented. As a result, people actually made plans to go to the Apple store to hang out, play with the latest products, take classes, and even have personal meetings with the “Apple Geniuses.”  As my wife is shopping at the mall, I have often found myself spending time at the Genius Bar learning new features on my iPhone, iPad, Apple Watch, or Mac computer.

What If Dealerships Were Like Genius Bars?

So, here’s my question to everyone who thinks dealerships must be only focused on selling vehicles or driving traffic to service centers: Is there not another option? What if automotive dealerships were more like the Genius Bars at the Apple stores, and people looked forward to visiting rather than dreading a whole day of browsing options, negotiating, and paperwork? I think of my mother-in-law, who has bought three brand new vehicles — an Aston Martin, BMW, and recently an Audi — only to immediately return all three because she could not understand the technology in the vehicles.

It’s true that vehicles will only get more complex with time, and there will be many benefits to these new features, but a critical component that we fail to consider is how customers will be able to learn all this technology. Especially since most drivers keep their vehicles for a few years, the technology will have changed so much by the time they begin shopping for a new one.

Customers need accessible and beginner-friendly ways to explore new vehicle technology and feel confident about driving a new car off the lot. There should be resources available on how to use the dashboard, connected products, subscription services, and even software updates. All OEMs should have a mobile app if they do not already, and all OEMs should be working with dealers to make sure that their customers understand how to get the most out of their vehicles using that app. Imagine a future in which folks are booking classes at the dealership, playing with new products, and getting sneak previews of upcoming products and the latest technology.

The Evolution of Loyalty Requires a New CX Approach

The saleswomen at my local Ford dealership spent over an hour with me on my new Edge just to explain how to use the dashboard. Her commitment to creating a great experience has made my wife and I loyal to her dealership, and we buy all our vehicles from that location. Even better, we send our friends and family to this dealership.

I am suggesting that dealerships change their approach to customers by looking beyond service and delivery centers as the only means to lifetime value. They must considering becoming a lot more like Genius Bars, and OEMs should invest in this future for their dealers as well.

Enabling dealers to become showrooms staffed with educators, such as with dashboard screen simulators that teach customers about how to leverage the great technology within vehicles, is the key to long-lasting loyalty and increased revenue. Consumers who understand connected products will spend more money on subscriptions and will be more likely to keep coming back for purchases, from vehicles to aftermarket parts, as well as servicing.

The Genius Bar approach is not an earth-shattering idea, but rather a strategy that aligns the brand with the new technology it sells and the modern consumer it sells to. If done correctly, the increased loyalty will help OEMs and their dealers better understand their customer base, providing more guidance for future product releases.

At Perficient, our automotive experts are ready to help you create a great customer experience, both online and at your dealerships. Whether you need a workshop to develop an approach or a capability assessment for the technology you’ll need, we have the industry knowledge and the technological expertise to build a sustainable competitive advantage for your brand. Together, we can develop your consumer lifetime value and increase loyalty.

Tap into our automotive industry expertise.

Last year, Perficient hosted an automotive event in Detroit that was so successful we had to return. Last week, I returned to the Shinola Hotel to meet with a new group of industry leaders – this time, we discussed brand loyalty and emerging trends and technology.  

Everyone Should Take the Wheel of Loyalty 

Loyalty is being transformed by a changing automotive customer demographic – millennials now represent the largest group of automotive shoppers, and they naturally have different preferences and needs. As consumer preferences change, so does our strategy for achieving and growing loyalty. It used to be that the responsibility of loyalty was housed in one department, where marketing was the custodian. However, loyalty is so much more. It’s not only about getting to the next sale, but rather achieving lifetime value. As a result, loyalty is managed across departments like technology, finance, and sales, all tightly aligned with marketing. 

Improving CX Will Win Back Customers 

The steep decline in loyalty to one brand presents a serious challenge for automotive OEMs that want to maintain their customer base. With increasing competition and changing market demands, brands must rethink their CX strategies. Thanks to behavioral science research, we are continuing to better understand what motivates customers to remain committed to a brand. Brand loyalty is built over time with consistent and positive experiences, so any tangible improvements in these areas will have a lasting impact on a brand’s bottom line. 

Emerging Trends to Watch 

One of the biggest emerging trends for loyalty is that it is expanding beyond a rewards and points system. Customers desire a strong affiliation with the brands they love, which means that loyalty can no longer be one-sided. The most successful brands will prove their loyalty to their customers, not just demand that customers are loyal to the brand.  

In attendance at our event was an executive of customer care at one of the largest OEMs, and she stated that every customer interaction they receive is answered. She also explained that negative reviews are actually a great opportunity to demonstrate loyalty to the customer. These strategies are only a few of the many ways a company to broaden and strengthen their loyalty efforts, and they’ll help brands set themselves apart from the crowd. 

The Data That Drives Loyalty 

The average American participates in almost 15 different loyalty programs according to Consumer Reports. The way to become the favorite is to provide lifetime customer value: Pre-purchase to post-purchase experiences must excite and delight to obtain high retention.  

Of course, technology is a big part of initiating any loyalty program today. With the customer journey becoming increasingly complex with multiple touchpoints, no longer following a linear path, companies must be able to pull in data from all angles and analyze it effectively to drive decisions. Currently, most brands aren’t pulling enough data. Others might have an abundance of data, yet they lack the strategy to utilize it correctly.  

Customer data collected from loyalty programs is only powerful with the right technology. For example, machine learning is critical to processing the mass amounts of data, and effectively inform how a brand can better provide lifetime value, uncover audience insights, and track churn. Automotive brands should dive deep into how they can get the most out of their loyalty platforms like Salesforce, AWS, and more. 

Continue to Explore the Changing Face of Loyalty  

The combination of changing consumer preferences and emerging technology makes brand loyalty a constantly moving goal post. Automotive brands must get ahead with a deep understanding of their audience, a pulse on the latest trends, and a firm grasp of the technology that is helping them achieve their goals.  

This automotive event’s conversation was certainly excellent, but it also is certainly not the last. I thank my teammates, technology partners, and wonderful clients for spending time with us to bring light to the challenges and solutions in the loyalty space. 

We now continue our trip across the country to meet up with automotive leaders everywhere to discuss loyalty and emerging technology. Please reach out if you’re interested in attending an event like this one – and learn more about Perficient’s automotive expertise in the meantime. 

It’s best to learn from our past in order to prepare for the future. As part of that practice, let’s review what happened in the last quarter of 2023 for the automotive industry, and make some predictions on what we can expect for 2024.

Gas Prices at the Close of Q4, 2023:

Hawaii               $4.68                               National Average     $3.07

California          $4.62                               Florida                       $3.12

Washington      $4.04                              Pennsylvania            $3.35

Oklahoma         $2.59                               Virginia                     $2.93

Arkansas           $2.63                               Texas.                        $2.68

My prediction: Oil prices will be back on the rise as global demand for crude rebounds driven by China’s emergence from COVID lockdown – further swayed by a worsening of the Russia-Ukraine war.  The US is taking some oil off the market by refilling our strategic petroleum reserves.

The Purchasing Managers Index (PMI)

Manufacturing PMI: The Purchasing Managers Index (PMI) is a major economic indicator derived from the monthly survey of Private Sector Companies – and measures the change in economic activity in the manufacturing sector.

• PMI>50.00 points = Expansion
• PMI<50.00 points = Contraction
• The PMI in the U.S. was 47.90 points in December 2023, down from 49.40 points in November 2023.

Automotive Economic Factors

• For the U.S. Auto Market – “Normalcy” will sum up 2024 per Cox Automotive
• Slow growth ahead, but better than a recession
• Vehicle supply is back, favoring consumers, and placing downward pressure on prices
• In 2024, we officially bid farewell to the Sellers’ Market
• The EV Market in 2024 will be the “Year of More” – More models, more incentives, more discounting, more advertising, and more sales muscle

Electric Vehicle Sales

EV Sales: 4^th Quarter sales were up only slightly from the 3^rd Quarter, but year-over-year growth was 46% pushing total sales to 1.1 million units.  EV’s share of retail sales is 7.4% of the market.

Here are the top EV States:

State                                                              EV Share of Retail Sales

California                                                     21.1%

Washington                                                15.4%

New Jersey                                                  10.3%

Nation                                                           7.4%

Connecticut                                                6.6%

Texas                                                              5.4%

New York                                                      4.7%

Pennsylvania                                               4.1%

Michigan                                                      3.1%

Ohio                                                              3.0%

• EV Status: More models, more choices, more sales, 37 new models in 2024, 34 new models in 2025
• EV Inventory: The day’s supply is well above the industry average. EV inventory increased by 92% in 2023. This is a 113 days’ supply as of 12/31/2023. ICE days supply is 69 days.
• EV Transaction Prices: Started off in January 2023 at $20,000-$25,000 higher than ICE.
• As of December 31, 2023, EV average price is $50,736 and ICE average price is $48,759. This is driven by supply inventory, higher incentives, and competition.
• EV Leasing: Expected to rise further in 2024 – Treasury announced that leased EVs not assembled in North America can receive the IRS tax credits.

Today’s Fastest Growing Competitor

BYD (Build Your Dreams) sold 525,409 electric vehicles in the 4^th Quarter of 2023 vs Tesla who sold 484,507 in the same quarter.  In the full year of 2023, Tesla sales are 1.8 million electric vehicles vs 1.57 million units for BYD. However, BYD also sold 1.44 million hybrids.

BYD was founded in 1995 as a battery maker for cell phones. It also sells hybrid gas/electric cars and forecasts to sell 3.6 million total vehicles this year.

A few BYD highlights:

• BYD has outsold VW, formerly the best-selling brand in China
• BYD has Warren Buffet Berkshire Hathaway backing
• Berkshire Hathaway took a 10% stake in BYD in 2008 for $232 million. By December 2009 this investment was worth $1 billion
• BYD is now in Europe and Southeast Asia, and is already the top EV seller in Australia, Sweden, Thailand, and Israel
• Not in the US yet for cars, but BYD has become one of the largest electric bus and truck manufacturers, a segment with an easier entry point than passenger vehicles
• US/China relations are so tense that BYD executives said the US Consumer vehicle market is effectively off-limits for now
• China companies are great copiers – first car was in 2005 and looked identical to the Toyota Corolla except for the badge – they called it the F3

BYD avoids expensive investments in automation and hires thousands of workers to handle simple processes. They typically bring in employees on short-term contracts, replacing them to avoid wage increases. Some of BYD’s lowest level factory floor workers are paid $750 a month, compared to $1,000 a month at the Tesla Shanghai plant.  They make almost all the parts for the vehicles in-house with few suppliers.  They could sell the F3 for $8,000 or half the cost of the Toyota Corolla.

The EV market and economy have slowed, and there were fewer government incentives. BYD sold 21% fewer vehicles in 2019. In 2020, they came out with a 375-mile range battery – and the total car costs $30,000-$40,000 less than a Tesla S with a similar range. Its global sales quadruples from 2020-2022. BYD is China’s top seller of EVs and plug-in hybrids. China’s market is 33% full EV and plug-in hybrid. BYD’s big push has been electric buses in the US, UK, and Japan over the past decade, and they are also building plants with more automation.

What’s the Next Bottleneck?

Over the last 24 months, chip availability used in vehicle production has been a major issue.  Elon Musk thinks of vehicles as computers on wheels – all controlled by chips. It was chips in 2022-2023 that caused a slowdown, but in 2024-2025, it could be graphite. China’s new restriction on exports of graphite – a key material for electric vehicle batteries – is casting uncertainty on US EV battery production. China, effective December 1, 2023, requires export permits for certain graphite products for use in EV batteries.

Graphite is the main component in lithium-ion batteries and accounts for more mass than lithium, cobalt, manganese, and other materials used in the cathode and elsewhere in the battery. The US needs a million tons per year – the current capacity is zero in North America.

General Automotive Highlights

• 2024 North America – Car, Truck, SUV of the Year Award
  • Car: Toyota Prius/Prius Prime
  • Truck: Ford F-Series Super Duty Pick-ups
  • SUV: Kia EV9
• Demand for EVs continued to climb, but at a slower pace than expected. Ford, GM, and others postponed or cut back investment in anticipation of a more gradual transition into an electric future
• Lithia is the number 1 Automotive group based in the US – they’ve expanded in the UK with the purchase of Jardine Motors and the Pendragon Group
• Hyundai – Amazon to sell new vehicles through Amazon’s website. Where will this go? What OEMs will follow?

Stay In Touch With the Latest In Automotive

Perficient’s automotive expertise runs broad and deep in the industry, covering the top priorities, biggest concerns, and most pressing needs of dealer groups, OEMs, suppliers, and other automotive companies. We stay in touch with the present and always keep an eye on the future, making us the best partner for your path to success. Learn more about our automotive expertise and bring us in on the conversation to accelerate your innovation.

Did you miss our event or need a refresh? Watch a recap of Lisa Sherwood’s presentation at our Electric Cars + Coffee virtual event!

On February 16, I had the opportunity to join my colleagues Lisa Sherwood and Kevin Espinosa in hosting our “Electric Cars and Coffee” virtual event. The event brought together our clients, Driftaway Coffee, and Perficient teammates for a lively discussion over freshly brewed coffees about electric vehicles (EVs) and barriers to adoption.

Caffeine and Customer Experience

We kicked off our event with an AeroPress brewing demonstration led by our friends at Driftaway Coffee. After everyone finished brewing their coffee, we dove into a discussion about electric vehicles (EV). Lisa Sherwood, Director of Audience Insights at Perficient, presented our findings from our EV customer journey research and broke down the insights we obtained from surveying automotive customers who had either recently bought an EV or would consider doing so in the next few years. These findings included the most important factors of their car-buying decisions, including what they prioritized as features of a new vehicle, why an electric vehicle may or may not be a good fit, and what they wished dealerships would do better during the shopping experience. Within her presentation, Lisa focused on the key insights that could help OEMs, dealers, and adjacent companies transform their experience to better support EV adoption.

Cross-Industry Collaboration Is Key to EV Adoption

Our team could tell from the onset of the event that the conversation would be informative and engaging, as we had attendees representing multiple industries, including manufacturers, automotive companies, and even utilities and electrification infrastructure companies. The discussion did not disappoint, with our clients asking thoughtful questions and sharing their own insights on the challenges of electrification.

It is not often that such inspiring leaders come together in a cross-industry environment to openly discuss topics like these that are impacting us all. More importantly, this event gave us all an opportunity to collaborate on what companies should be doing to better serve their customers.

We look forward to continuing the conversation about EVs, infrastructure, transportation, battery regulations, and more topics in the months and years to come as these leaders build out the future of automotive.

Explore our Journey Science and CX expertise that enabled our electric vehicle research.

Learn more about Perficient’s automotive industry expertise.