The commerce-connected car and how to prepare for it

It’s a scene everyone is too familiar with: sitting in the car stuck in traffic on the way to and from work. As daily commutes become longer in the U.S, commuters will be spending 900 million more minutes in their car each day by 2025.1

The connected car is transforming those hours into productive time that can be used to complete tasks ranging from shopping, adding appointments to digital calendars and prepaying for gasoline purchases — all with the help of a voice assistant.

Though still considered somewhat of an anomaly, fully connected cars will be more prominent in the next few years. In fact, 32 million connected car shipments were predicted for 2018. By 2020, that shipment prediction is expected to more than double.2

As the connected car becomes more common, consumers will have increasingly higher expectations for technologies available in their car. Companies that use the eCommerce space to integrate their services into connected cars will be better able to reach their target audience and meet those rising expectations. And those who integrate their services today will be in a leadership position when connected cars become mainstream.

As for auto manufacturers, brands that establish themselves as a pioneer in the connected car revolution early on stand to outshine their competition.

For example, Ford Motor Company is a company ahead of the curve, committing to 100 percent connectivity in all new U.S. vehicles in 2019 and 90 percent connectivity globally by 2020.3

The company also plans to create an open-sourced, cloud-based platform for connected cars that would connect cars and drivers to services.4 If successful, Ford’s cloud could pave the way for other automakers to follow suit.

The interactivity connected cars will bring to consumers and businesses has the potential to create new channels for retail sales, potentially contributing between $210 and 740 billion in global volume in 2025.5

eCommerce sales will continue to accelerate, making up 17 percent of all U.S. retail sales by 2022. Connected cars could nudge eCommerce projections even higher.6 In fact, 43 percent of commuters said they’d order and pick up groceries more often via a connected car.7 This creates an opportunity for a big box store to create a connected car app that allows drivers to verbally order items from the road and pick them up at a nearby store.

General Motors is in the process of developing a similar car-retail ecosystem. In 2017, GM launched Marketplace, which connects the car’s system with applications from outside companies.8 Now GM gives drivers the ability to prepay gasoline purchases directly through its vehicles at Shell stations, via the Marketplace application.

Drivers sign up for a Shell rewards account and link the app to the car’s infotainment center. When the car is low on fuel, the car locates a Shell station, shows whether the driver is eligible for discounted gas and preapproves the transaction as the car enters the station.

The seamless integration removes the friction of using a discount program and paying at the pump, therefore enhancing the customer’s experience. Shell benefits, too, by collecting more information about its customers.

As connected cars become more commonplace, early access to these technologies may provide an early adopter advantage. Businesses should look for opportunities to partner with connected car solution providers to promote their products or gain exclusivity within this niche (for now) audience.

Source: Business Insider, Bank of America Merchant Services Analysis

But the audience won’t be limited for long. More consumers will begin to expect a convenient, helpful and engaging experience as connected devices evolve. They’ll see new technologies deployed across payments and retail environments, prompting them to demand a personalized, seamless purchase journey while in the comfort of their cars. Businesses that tap into these technologies now will quickly raise the bar for all other industry players.

The connected car: processing decisions

Two very different car payments ecosystems could result depending on how payments are processed.

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