The Jaguar Land Rover company is internationally known for its excellence in automotive manufacturing, designing and selling luxury and sports utility vehicles around the world, for decades. A company with such a long and stellar history in the industry understands the importance of quality to its customers - and this is exactly how it is thinking about its digital ambitions.
Whilst some in the automotive industry may believe that ‘digital innovation' in cars means filling a vehicle with all the latest apps and services, Jaguar Land Rover is taking a more nuanced approach that speaks to the fundamentals of its brand and what it means to own a car. Simply put, the company is thinking about how digital can be used to improve its quality for customers, get customers where they want to go, and how it might impact future business models.
Harry Powell, Director of Digital Excellence at Jaguar Land Rover, was speaking at this week's Google Cloud Digital Manufacturer Summit, which can be accessed here. Powell said that customer experience is at the center of everything Jaguar Land Rover does and that it is very focused on how people interact with its cars over the web. He said:
The thing that our customers need from us more than anything else is quality. If they spend £100,000 on a Range Rover, they don't want to be sitting on the edge of the motorway. So linking our cars through the connected car, through this new world of real-time streaming data, how can we continuously improve the car? How can we continuously improve the software? So the very basis of the customer experience is being able to drive their car, being able to get where they want to get to, every time, all the time.
Sometimes it sounds a little less exciting. But if you're the person that's stuck on the hard shoulder of the motorway, life is not about exciting at that point. It's about getting where you need to go.
Understanding the user need
In addition to the above, Powell said that connected car information can be used to ensure that Jaguar Land Rover cars are filled with features that customers actually want - rather than relying on guess work or packing too much into a car that's not needed. He said:
User experience, it's really important. My Range Rover's seats have 24 different directions of movement, right? It would be really useful to know which of those directions do people actually use? Because customer experience is only customer experience if people actually use those features, right?
What people say they want is not actually always their revealed preference, what they actually use. If they're not using stuff, unless it has some weird halo effect, you're better off not putting it in the car to make the car cheaper, or even better, replacing it with something that they actually do use.
Powell added that these insights can also allow Jaguar Land Rover to think about how it can bundle and create packages for people that are buying its cars. The aim being that if customers are more engaged with a variety of services supplied by the company, they will be more likely to purchase again at the end of their vehicle's lifetime. He said:
It's not enough to get people to buy your product once, you want to provide things that get them absolutely loving the way that they use your product. Providing them with the right kind of packs that they're going to use, that they're going to get really attached to, so that they want to buy it again next time. It's really important in the sustainability of your business.
The future of automotive
Jaguar Land Rover is also considering how it can use digital and data to assess its role in the future of the automotive industry. Car ownership and the way cars are run is changing - with the rise in elective vehicles and ride sharing to get people where they want to go. Powell knows that Jaguar Land Rover can't bury its head in the sand with these market trends and is actively thinking about how it can take advantage of them. He explained:
It's not just about autonomous, it's about shared, electrified. We have a number of platforms that we've invested in, which are all about the shared economy. And shared cars will be driven by how people use the car. Using that information to create new services and new ways of doing things is a really big part of what we call our ‘Reimagine Jaguar Land Rover" going forward.
When you start thinking about the shared economy, you can start to see how people are driving their car, when they're driving their car, where they're driving their car - you start to connect the patchwork and understand what products you can offer that would appeal to people. That would appeal to diverse groups of people that currently don't connect together.
However, Powell notes that prioritization is the name of the game in digital and data - because there's always more to do and there's always more that you can do. However, it's important to understand the route to value, he said, and to think about not only the challenges facing Jaguar Land Rover as a business, but also the challenges within the industry as a whole. He added:
There are clearly strategic priorities for us. Our new strategy was announced in the Autumn, with a very, very big emphasis on batteries. It's a massive challenge, we're trying to electrify the whole of Jaguar by 2025. This is a massive change for us and we've got new platforms to develop. Anything that can help us simplify, that's a big priority for us, because we've just got so much going on right now.
The other thing about prioritization right now, having just come through COVID-19, is around profitability. And why is that? Because without profits we can't invest in the things that we need to invest in. We have huge amounts of investment to do as a business, both in software and hardware, so we need prioritise where we can create profit, where we can create value. And data can be incredibly useful in that. This is really crucial, because when you can automate the outcome, the route to creating value is lower risk.
Keeping it simple
Powell also took the time to speak in a personal capacity about how he perceives digital developing over time in the automotive industry - and it closely aligns with the themes mentioned above. Simply put, it's about understanding why people buy a Jaguar Land Rover - or any car, really - and putting tools and services in place to make that experience better. He said:
Cars are still going to be about moving people about, fundamentally. The extent that services can help move them about, I think there's real value there. To the extent that services are making the journey more pleasant - maybe - but many journeys are quite short.
But to the extent that those services interrupt people's concentration, I think we want to be a little bit careful about how much economic value we put towards those things.
I think it depends on the kinds of cars that you're selling, right? A Range Rover is going to cost you, let's call it £100,000, so the proportion of that value that's going to come from apps is going to be a little bit different to the proportion of an iPhone, which might cost £1,000. The proportion of value coming from apps is going to be different.
That doesn't mean I don't think there are massive opportunities there. But it's probably going to come from a restructuring of how we think about how we drive, how we share, how we charge - all of those kinds of things. Rather than thinking that you have a screen in your car and you use the apps like you do on your phone.