Why BMW needs to own its customer experience from start to finish

For the last few years now, BMW has wrestled with the question of what it’ll mean to be a luxury car manufacturer in the age of electric cars, autonomous driving and rapidly changing — and increasing — customer expectations. What, after all, makes something the “ultimate driving machine” when the driver eventually stops driving?

For BMW, the answer is a renewed focus on technology and the in-car experience it enables, without forgetting its heritage in performance cars. To discuss the state of the company’s transformation, not just in terms of its cars but also its business model, I sat down with BMW’s outspoken VP of Digital Products and Services Dieter May shortly after the company unveiled the latest version of its in-car operating system.

“We build digital products and services that are meant to help us differentiate our core product, the car and generate revenue,” May said. “But these digital services also provide us with channels and touch points that allow us to now have a direct relationship with the customer on the sales side and talk to the customer directly.”

In the car industry, however, the sales channel has traditionally been the dealership. That’s where you buy the car and that’s where you get it serviced. It’s the dealer who knows (ideally) who you are and what you want. The manufacturer’s role in this model is to build the car, maybe build a bit of a central online presence with a configurator so customers can get some idea of the car’s price — and get out of the way.

That’s not the future that May envisions, though. And neither is it one where the big tech companies like Apple and Google own the driver and the user experience.

“As we’re building the digital products in the car, we are also building out the car as a channel and touchpoint at the same time,” May noted. “We’ll have our app, a personal assistant etc. and with that, we can create a user profile and provide that to our sales teams. Today, virtually every car manufacturer can’t talk directly to the customers because the customer belongs to the dealer, and because the different business units, like after sales, financial services, etc., aren’t unified and all try to talk to the customer separately.”

So for BMW, digital experiences in the car are one thing — and you can expect to hear a bit more about this in the coming weeks and months — but the company is looking beyond this and how it can use this transformation to also create new business opportunities that go beyond maybe selling an in-car Spotify subscription for a few dollars. But what gets May most excited about this is the prospect of being able to talk to the customer throughout the ownership lifecycle. “That’s the cool part, because it allows me to keep the product ‘car’ fresh throughout the lifecycle and manage it like a device,” he said.

The move that May is hinting at here means that BMW wants to not just focus on selling cars but to create a model where it can extract some revenue from users throughout the car’s life. As an example, May noted that BMW may sell you a Mini with a charging package and, in addition, it’ll sell you a flat-rate subscription to charge it. “There are so many opportunities here, but you have to play it smart, both before somebody buys the car and after the sale.

If BMW wants to own the customer, though, that means dealerships have to change. “The dealers will have to grow into a different role over time,” May acknowledged. “We expect and hope that just as we will share data with the dealer, the dealers will share their data with us. A small piece of a larger cake is still better than nothing.”

Customers will still come to the dealer for their service needs, so BMW isn’t cutting them out completely, but the company definitely wants to own a larger part of the relationship with the customer. And at the end of the day, it’s the dealer who represents the manufacturer, whether that’s taking somebody on a test drive or helping the customer take delivery of a car.

“What’s most important for us — and everybody is talking about autonomous driving and electric vehicles and so on — but if we don’t become a customer-centric company, then we are destined to fail. The number of digital elements in our customers’ lives and in the car continues to increase, and if we don’t understand that, we’ve got a problem.”

As for its current in-car systems, May told me that BMW now has more than three million registered users for its ConnectedDrive system, but what’s maybe more important is that the number of user interactions is increasing significantly faster than that. What’s interesting to hear is that the way BMW thinks about these users is pretty much in line with any consumer internet company. The team tracks monthly, weekly and daily active users, for example, and is working to increase those engagement numbers with every update.

One problem car manufacturers have long suffered from is that cars stick around far longer than smartphones, and that the in-car technology can quickly seem out of date. Because it is betting on a connected car that is always connected to the cloud, BMW (and, to be fair, many of its competitors) is now able to update the in-car software. That’s true for new head units, but not necessarily for older ones, and fragmentation remains an issue — though with a standardized model for both BMW and its Mini brand, that’ll likely be less of a problem for newer cars than for those that launched two or three years ago.

“In the car industry, a lot of people think that everything has to be backward-compatible reaching back 20 years, but my take is that we have to be more like smartphone vendors,” said May.

Taking a page from the software industry, the BMW team often launches new features that are akin to minimal viable products. That’s not necessarily something the luxury car buyer is used to, of course, but it does allow the company to test new features and expand on them as they gain traction.

The next concrete step for BMW in this journey is to feature an interactive personal assistant in the car that knows about the customer. May believes this will drive a lot of usage. Although the exact details remain to be seen, the BMW team hinted that we’ll learn more in the fall.

With its new in-car operating system, BMW slowly breaks with tradition

When you spend time with a lot of BMW folks, as I did during a trip to Germany earlier this month, you’ll regularly hear the word “heritage.” Maybe that’s no surprise, given that the company is now well over 100 years old. But in a time of rapid transformation that’s hitting every car manufacturer, engineers and designers have to strike a balance between honoring that history and looking forward. With the latest version of its BMW OS in-car operating system and its accompanying design language, BMW is breaking with some traditions to allow it to look into the future while also sticking to its core principles.

If you’ve driven a recent luxury car, then the instrument cluster in front of you was likely one large screen. But at least in even the most recent BMWs, you’ll still see the standard round gauges that have adorned cars since their invention. That’s what drivers expect and that’s what the company gave them, down to the point where it essentially glued a few plastic strips on the large screen that now makes up the dashboard to give drivers an even more traditional view of their Autobahn speeds.

With BMW OS 7.0, which I got some hands-on time with in the latest BMW 8-series model that’s making its official debut today (and where the OS update will also make its first appearance), the company stops pretending that the screen is a standard set of gauges. Sure, some of the colors remain the same, but users looking for the classic look of a BMW cockpit are in for a surprise.

“We first broke up the classic round instruments back in 2015 so we could add more digital content to the middle, including advanced driving assistance systems,” one of BMW’s designers told me. “And that was the first break [with tradition]. Now in 2018, we looked at the interior and exterior design of our cars — and took all of those forms — and integrated them into the digital user interface of our cars.”

The overall idea behind the design is to highlight relevant information when it’s needed but to let it fade back when it’s not, allowing the driver to focus on the task at hand (which, at least for the next few years, is mostly driving).

So when you enter the car, you’ll get the standard BMW welcome screen, which is now integrated with your digital BMW Connected profile in the cloud. When you start driving, the new design comes to life, with all of the critical information you need for driving on the left side of the dashboard, as well as data about the state of your driving assistance systems. That’s a set of digital gauges that remains on the screen at all times. On the right side of the screen, though, you’ll see all of the widgets that can be personalized. There are six of those, and they range from G meters for when you’re at a track day to a music player that uses the space to show album art.

The middle of the screen focuses on navigation. But as the BMW team told me, the idea here isn’t to just copy the map that’s traditionally on the tablet-like screen in the middle of the dashboard. What you’ll see here is a stripped-down map view that only shows you the navigational data you need at any given time.

And because the digital user interface isn’t meant to be a copy of its analog counterpart from yesteryear, the team also decided that it could play with more colors. That means that as you move from sport to eco mode, for example, the UI’s primary color changes from red to blue.

The instrument cluster is only part of the company’s redesign. It also took a look at what it calls the “Control Display” in the center console. That’s traditionally where the company has displayed everything from your music player to its built-in GPS maps (and Apple CarPlay, if that’s your thing). Here, BMW has simplified the menu structure by making it much flatter and also made some tweaks to the overall design. What you’ll see is that it also went for a design language here that’s still occasionally playful but that does away with many of the 3D effects, and instead opted for something that’s more akin to Google’s Material Design or Microsoft’s Fluent Design System. This is a subtle change, but the team told me that it very deliberately tried to go with a more modern and flatter look.

This display now also offers more tools for personalization, with the ability to change the layout to show more widgets, if the driver doesn’t mind a more cluttered display, for example.

Thanks to its integration with BMW Connect, the company’s cloud-based tools and services for saving and syncing data, managing in-car apps and more, the updated operating system also lays the foundation for the company’s upcoming e-commerce play. Dieter May, BMW’s VP for digital products and services, has talked about this quite a bit in the past, and the updated software and fully digital cockpit is what will enable the company’s next moves in this direction. Because the new operating system puts a new emphasis on the user’s digital account, which is encoded in your key fob, the car becomes part of the overall BMW ecosystem, which includes other mobility services like ReachNow, for example (though you obviously don’t need to have a BMW Connect account just to drive the car).

Unsurprisingly, the new operating system will launch with a couple of the company’s more high-end vehicles like the 8-series car that is launching today, but it will slowly trickle down to other models, as well.

Ola will add 10,000 electric rickshaws to its India fleet over the next year

Ola announced today that it will add 10,000 electric auto-rickshaws to its fleet in India over the next 12 months. The program, called “Mission: Electric,” is part of its ambitious plan to put one million electric vehicles on the road by 2021. The company launched a trial EV program last year in the city of Nagpur, but has reportedly run into some recent road bumps.

Three-wheel rickshaws are a popular way of making quick trips in many cities and can be hailed through Ola’s app; the company’s electric vehicle trial program in Nagpur, which started in May 2017, already includes rickshaws. As part of “Mission: Electric,” Ola said it will add 10,000 new electric rickshaws across three additional cities this year.

To enable drivers to switch to EVs, Ola’s program also includes infrastructure like rooftop solar panels and charging stations. Last month, however, Factor Daily reported that Ola is scaling back its electric vehicle plans after India’s government appeared to become less enthusiastic about creating an explicit EV policy, despite its previously stated goal of making all new vehicles electric by 2030.

Around the same time, Reuters reported that many Ola drivers participating in its Nagpur trial wanted to switch back to fuel-powered cars because of long waiting times at charging stations and higher operating costs.

An Ola representative told TechCrunch that the company has installed charging dockets at the homes of some drivers so they can save time by swapping out batteries, stating that “with new technologies like battery swapping, the charging experience has been significantly improved.” Ola is currently in discussions with several state and municipal governments about where to launch its electric rickshaw program and is “willing to work with any city committed to sustainable mobility solutions.”

“We have clocked more than four million [electric] kilometers and have learned the ins and outs of vehicles, capabilities and applications. We have learned real-world operating challenges and cost implications of chargers, batteries and solars,” she added. “Deployment of electric vehicles would require support of like-minded partners.”