How to deploy an analytics-driven showroom


Dealership owners and marketing managers need to increase visibility of specific cars to specific audiences. Through targeted campaigns and real-time insights, you can ensure your message is reaching the right audience. Leveraging consumer data can show which cars are attracting more or less attention – enabling car dealerships to adjust in-store promotions accordingly.


Kyra: Hey, everyone. Thank you for joining us for today's webinar. We're super excited to have you here. We're excited to have Joseph Lanners, Director of Retail and Automotive Retail Innovation at Samsung SDS, and Daniel Xing, Senior Manager of Product at HARMAN, or the Ignite cloud platform, here today. Joseph, why don't you get us started?

Joseph: Hey, everyone. Thanks for joining. I appreciate it. Joseph Lanners here. Great introduction, Kyra. Really excited to be with everyone today.

What I want to do is just kind of give a brief overview for everyone on the call about the converging trends that are happening within the dealership, OEM, and consumer space, and how technologies are used now to drive analytics-based decisions. Owners are definitely demanding better in-vehicle services. Dealerships need better purchase experiences and customer leads. And then, owners are also demanding, basically, a better purchase experience as well. So, pre- and post-sale. Those types of services are needed. And, of course, with the innovation of new IoT-based data sources, the ability to collect, capture and analyze data is increasing and improving drastically.

So, you've already got access to hundreds of different applications, web services, CRM tools already within your dealership market. What's changing, of course, is the way that sensors are being utilized within physical spaces. And the sensors could even include video sensors. So, we'll talk a little bit about how you can improve the in-dealership experience and your ability to capture data, and use technology that can, basically, create new analytics reports, give you new insights to your customers' requirements dealership data, as well as the OEM data that you can leverage and capture as well. That can drive, essentially, better advertising, contextual signage, and a better ability for you to staff, merchandise your showroom and order the right inventory to meet market demands.

So, as you look at the way that sensors can be used, even video cameras or beacons or other technologies, they can essentially watch for patterns within a physical showroom, or in a service center area. Essentially, that data can be viewed as metadata, as opposed to actual video streams. So, the video streams are never actually recorded. The beacon information is all captured in terms of metadata. As a platform, there are platforms out there available out in the marketplace that can allow you to capture all that data, get information about demographics, foot traffic, whether it's male or female or family, a group of people, where they're lingering, how long their dwell time is, how long they're interacting with sales people, how long they're actually interfacing with a particular car, which would be a merchandising type of scenario.

And then, that content that you are using in your buying or leveraging from the OEM directly, or that you've created for your own dealership can be used in such a way where you can specifically target the demographic that you're looking for, or the ones that are actually in the dealership showroom, as opposed to putting it in a loop. This is called a contextual digital signage. And these whole platforms that are available out there leveraging cloud, which you'll be hearing a little bit from Daniel in a little bit as well, kind of shows exactly how OEMs dealers and consumers are now converging in terms of the way that that data can be analyzed, captured, and create the best service in sales experience.

So, just for an example, this could be an interactive showroom. It could also be a pop-up store that many OEMs are using, or even large dealer groups, or even dealers who have a large market are basically going off-site into the community at an event center within their ZIP code, within their regional area, where you're going to have a lot more foot traffic, to be able to capture more leads. You're seeing some of these activities with some of the more innovative car companies that are out there. The newer car companies in the market like Tesla. They're leveraging these spaces, even a Kia Stinger, for example, maybe launching. These are sponsored by the OEMs. And what comes out of these are qualified test drives, better quality leads for buyers who are actually interested in the automobile. And then you're able to convert those once you get them physically within the dealerships, not just grab web leads. But you're actually getting leads from community engagement.

And, of course, these types of data capabilities are affected by both the digital experience for the customer. You can collect new insights at the OEM level. And then, of course, for lead generation for the dealership. So, you want to be able to promote more loyalty for the service that you're providing within the dealer. You can gain more insights about that individual customer's requirements, which gets you better quality leads, better quality test drives, and then a higher price per unit in terms of what you are selling the vehicles for.

The same data can be collected and captured at the OEM level so that they know which cars to manufacture, not just, you know, produce the cars that are ordered by the dealers across the nation. And you can essentially see where this should be going. You know more about the consumer, OEM builds the right cars, the dealership orders the right cars to meet market demand, and you're able to essentially then sell the car for a higher revenue per unit.

So, other types of technology then that are being utilized within the physical showrooms are virtual reality or augmented reality 3D modeling capabilities. And, you know, customized design for more higher-end vehicles in the luxury car market.

So, just a few quick examples of even advanced analytics capabilities that go above and beyond that. I think we mentioned at the very beginning to kick off the webinar that there are many CRM applications or web services that you're already subscribing to. Those services and applications are usually quite integratable into some of these newer, advanced IoT-based sensor systems. These IoT-based sensor systems then can help you improve and integrate into the sales funnel for better targeted advertising, capturing information about, you know, what areas of the showroom might need to be remodeled or re-merchandised with a different vehicle, which ones are getting the most traction with the number of visitors, how long they are dwelling around a certain car or interfacing with a certain car. And a lot of information about demographics, including the age, gender, and even sentiment now as they are interfacing with digital signage. So, you can gauge whether a piece of advertising that you are using is making somebody happy, whether they are having a negative experience, they are surprised, or just a neutral experience. And then how long they're dwelling around that digital asset that you have invested all that money to create as well when you've remodeled your showroom.

Just some examples of some of the reports that are out there in the marketplace gives you a better feel for being able to look at Generation Z, Gen X, Gen Y as baby boomers have gotten, you know, older as well. And you're able to then segment that by age and category, even time of day, day of week, or seasonality associated with, you know, how many visitors you get. This becomes quantifiable data that says, "Look, we're getting more visitors in the showroom during these months out of the year. Maybe we should staff more." Or "We're getting a ton of visitors coming from the service department into the sales departments during times that we normally don't staff for sales people or product experts, maybe it's a good idea that we change that." Same thing with looking at the zones within the physical spaces, as well, whether it's the waiting area that it's not getting utilized any more. Maybe it needs to be revamped or, you know, updated.

And so, I'll give one quick example of a German OEM that has created a very dynamic experience within some of their showrooms throughout China, and at some of their experience centers. And as you can see on here, they've gotten into the use of a lot more data in technology. And with that, they're able to provide sort of a digital check-in process, even some self-service. As millennials grow up and as some of us younger generation do grow up or we become more proficient and comfortable with technology, we're more comfortable with doing things on our own. Yet some other demographics may prefer a more personalized experience. So, you can begin to see how the data can then drive an experience within video walls in a VR experience at the digital check-in or even a service center area that enables an analytics-driven showroom.

To that end, though, of course, you know, wearables are a new trend in the market as well where service personnel or sales personnel are able to get alerts based on interactions within the showroom as well. Or when a particular guest drives their car up into the service center, they can be greeted with a special greeting, or your service agent can actually get an alert on their watch to finish up and come greet their special guest.

So, now, I'd like to hand it over to Daniel, who's going to hit a little bit about some of the enterprise cloud services and the technology that's going into the vehicles at the OEM level that are going to continue to drive more data that can be captured, and start to impact the additional value across the whole community.

Daniel: So, like Joseph said, I'll be shifting the conversation a little bit more to the connected vehicle landscape, and talking about, basically, what happens as more and more vehicles and cars are becoming connected to the cloud, and what type of new applications and services are going to be offered as a market trend in the following years in the automotive space.

So, basically, there's just two parts to the connected vehicle domain. One is connecting the vehicle to the cloud. And the second is running a cloud platform that enables innovators and companies to launch services and applications on this cloud platform. We are seeing a lot of investments in the space not only from the traditional OEMs, but also OEM suppliers and the new entrances from big tech companies as well.

And the story I like to usually invoke is similar to the early and mid-2000s when mobile handsets were getting smarter and more capable. The applications and services that were traditionally only available on PCs and computers were starting to become available and integrated into the mobile device, creating the ecosystem that we now have with Android and iOS.

So, at HARMAN, we believe in the platform and enabling innovation and development into the applications and services for the automotive domain. However, we're also a huge believer in three key technology areas, which we are collaborating with Samsung with, since our recent acquisition last year. The first one is very obvious. It's the self-driving autonomous vehicle technology. Secondly, it's the AI assistance, coming from not only Samsung Bixby, but the likes of Microsoft Cortana, or the Amazon Alexa. And this space is particularly interesting because it could be a transformational technology once applied to a vehicle environment. And lastly, we believe a trend where, basically, Android is going to have a much more prominence in the hardware of the vehicle, of driving the operating system of the navigation and in-vehicle infotainment systems, whereas the traditional model powerhouses have been QNX and Linux-driven OSes.

Okay. So, that's kind of a brief overview of connected vehicles. How does this particularly relate to dealerships and the vehicle purchasing journey of your car customers? Well, I think, basically, if we dive into three key disruptions in this dealership and OEM space, we can key in on one is the success of the Tesla sales and dealerships models, where the model is shifting from a sales-first approach to a dealership to a showroom where an OEM or a dealership can showcase the innovations and the technology of the vehicles that are being brought to the market. And, Joseph, covered quite a bit on, you know, on this aspect of this and how data and analytics can transform a traditional dealership into one of the showroom model.

One factor is the new generation of millennials that are becoming more of a factor in the customer acquisition lifecycle. As there's more millennials are purchasing cars, they are demanding better and more personalize products and sales experiences. A subcategory of this is car as a service. Basically, car share platforms that creates competition, direct competition to vehicle ownership itself. And what we're going to start seeing in the next several years is basically OEMs and dealerships kind of incorporating this car as a service into its own product offering.

And lastly, innovation in IT and big data creates incredible amount of challenges to the bottom line and the PnL for dealerships and OEMs. A good example of this is TrueCar. And basically, what the challenge here is now that OEMs and dealerships will have to kind of look to more creative avenues for revenue generation. And this I'll cover in the last few slides of this webinar as well.

So, I'm going to cover two use cases of where cloud analytics can actually help deliver dealership experiences and drive some business intelligence and decisions along that space. So, the first use case is it's around the fact that now; OEMs are spending a lot more money, investing in instrumentation of metrics into their vehicles themselves. They are trying more about how the customers are using the cars that they are selling. This includes how many customers and how often the customers of these OEMs are using satnav or navigation systems versus Apple CarPlay or Google Android Auto. This includes monitoring radio stations, button presses, soft key, etc.

So, what this allows OEMs to do is essentially build a product that is very much different from the traditional press fire and forget design process, where you build a car once and you deploy and you sell it. Now, they are able to capitalize on this information to constantly iteratively revise and improve the product features, throwing in resources into the features that matter the most to their customers. How this relates to a dealership expense now is that you can kind of see that by understanding the demographics and the users and the potential customers coming in, what type of features they use the most, it really can drive how you promote, and advertise for these features.

Now, one specific example: just imagine a vehicle is on the showroom floor. And for the first month, you know, you can use the Validex tool to figure out, "Okay. I should be promoting features X, Y and Z." Well, now, as the product is, .as the vehicle is becoming, and as the OEMs learn more about the customer base and is continuously improving their products, the features could actually change over the next several months. Imagine three months later, you could be promoting a different set of features that's being constantly updated and added to the vehicle, as that car is still up the showroom. So, these are some of the powerful ways that a connected car can really change the way OEMs and dealers envision and building and selling traditional vehicles.

So, next is a simpler example. I like to use this one because it's very clear of how cloud analytics can directly influence how a car that's sold in the marketplace and advertised. So, basically, as an instrumentation ad occurs on the vehicle, OEMs and dealers know exactly what radio stations or which channels their users listen to the most. And this could drive direct marketing decisions in terms of where to put your marketing dollars where it matters the most.

Okay. So, that covers the second topic of the millennials and how that's affected and how data and analytics can actually help alleviate some of the challenges in the area. The third topic was around TrueCar's innovation in IT and the big data challenge and the PnL and getting creative with revenue generation. Well, the good news is that in a study by KPMG last year, most of the automotive executives really believe that within the next 5 to 10 years, around 2025, that the post-sales revenue coming in from a vehicle will actually surpass the value of the car itself that was sold.

So, this is very powerful because one, the product of a car itself as just a one-time purchase is evolving. Now, we need to think about the car as its own kind of digital ecosystem where services and applications that could generate revenue for OEMs and dealerships can come on top of this after the sale of the product, the vehicle. And secondly, data is actually extremely important to this. KPMG thinks that this is kind of the fuel of the future for automotive. And what they particularly alluded to is basically that the monetization of this data will be extremely important. And it will be extremely important for dealers and OEMs to figure out a good way to leverage data.

So, in terms of how we perceive this post-purchase revenue taking place, we break it down into three key categories. Basically, we believe vehicle health, remote diagnostic, being able to offer these services post purchase will be extremely important. The second key is usage base insurance, which is extremely data driven, as well as offering vehicle maintenance as a subscription service could be one viable marketplace we'll see in the future. Vehicle maintenance is actually very interesting because we do see churns in a mechanic marketplace from various vendors and tech companies may involve something of a Amazon of sorts where consumers can pick and choose, you know, maintenance vendors based off of applications that the connected vehicle enables. And then lastly, it's an offering of premium content and services over the cloud post-purchase. And this includes being able to promote OEM and brand through these channels as well.

Our vision towards where connected vehicles will become kind of a industry-changing technology in the future. So, I'll hand over this conversation back to Joseph for the rest of it.

Joseph: Thanks again, Daniel, for the great insight as to where the industry is going, leveraging cloud and basically, trying to collect more data from the actual vehicles, and being able to utilize that at the OEM level, and for dealerships and consumers through data experiences. So, I think we'd like to, Kyra, turn it over to you. See if we've had any questions come in. And I'll probably take those when you get a chance.

Kyra: Great. All right. Thanks, guys. Great presentation. I had a question that just came in. How do you recommend that dealerships get familiar with analytics-based integration? Most of the budget at our dealership is already dedicated to other initiatives.

Joseph: Well, that's a common one. You know, the budgets are tight. Margins on common vehicles that are in highly competitive marketplace are very low. Sometimes, they are even loss leaders for dealers. The whole objective there is to be able to capture that customer and get them in and keep them.

So, there are some service industry areas or some service center area applications, and when I say "applications," you could take some of the existing cameras, or just a handful of other cameras, do a very small pilot or test run. I might even recommend a small pilot around a digital signage that you've already deployed within a physical dealership. There's a lot of great vendors out there including Samsung, that have these video analytics capabilities. And I might even recommend doing a sentiment analysis on the effectiveness of the digital signage that you have going on within a physical dealership space already. It's easy to capture sentiment. And people are looking at the screen or interacting with the screen, you can pick up their facial images from that, and then you can get general demographic information about the number of people.

So, with a small number of cameras, a very small pilot, it's quite easy to test and demo this. There's just a myriad of use cases wrapped around that. You could do it in the service center, you could do it within the physical sales space. I'd recommend taking a look at the market and seeing how to leverage that. But that's a really small investment to get a high return, and a lot of useful data in terms of how to remerchandise your dealership service area, or even measure what types of digital signage is most effective.

Kyra: Okay. Great. Thank you so much. And I think we have time for just one more question today. All right. Can you please explain further of how Samsung and HARMAN are working together to provide a more interactive and engaging showroom?

Joseph: Wow. I'm going to hit two sides of this. So, it sounds like the question was, "Can you explain further on how Samsung and HARMAN are working together to provide a better showroom, you know, experience?" There are two really key assets that are related to a showroom experience, or I'll call it an in-dealer retail experience. One is the AVL side. The other one is the digital data and the analytics associated with being able to, you know, know your customers even better, and be able to anticipate their needs.

So, with the acquisition of HARMAN, HARMAN has some of the most advanced, interactive showroom capabilities from in-dealership lighting, external dealership lighting, architectural lighting, audio and video sound, and control systems. So, when it comes to being able to control the ambiance of the physical space, those systems could be triggered using the Samsung analytics platforms that we have that leverage machine learning, video analytics, other sensors and other data that we're able to collect using our platforms. And really, what you could do is tailor the in-dealership showroom experience specific to the audience that you have in that particular dealership on a certain day.

So, if you've got soccer moms and dads coming in during the week, and you've got families coming in on the weekends, the music and the ambiance can change based on the demographic and the age and the gender and other information that you have within the dealership at that point in time without having to manually think about it as a dealership owner or a GM. And so, that's one of the ways that HARMAN and Samsung are working together. We're merging those types of systems.

I will mention one other that probably is very complimentary to that. It probably relates a little bit to what Daniel was talking about and mentioning. And that is, of course, you know, we are the world's largest smart intelligent vehicle enabler in the marketplace. So, our technology is actually go into the physical automobiles. So, when you get into connected vehicles, smart vehicles, safety features that go into those, those core technologies or pieces of data that eventually will also feed into the system. So, that's a little bit of glimpse into the future. And I think that probably covers it.

So, Kyra, with that, I want to thank NADA, all of its members for joining the webinar. We certainly look forward to promoting the automotive industry, and supporting it, both from an OEM level, a dealership level, and all of us as consumers. So, thanks again for hosting the webinar and we look forward to more educational sessions in the future.

Kyra: Absolutely. Thank you, Joseph and Daniel, for being here today. Thank you to all of our members who joined on. Thanks, everybody.

John Bertoli
John Bertoli

John Bertoli currently serves as Head of Marketing & Partner Services at Samsung SDS America where he is responsible for brand awareness and driving demand through outbound campaigns and optimizing inbound marketing channels to generate meaningful opportunities for the various business units and solutions, namely retail technology, digital out of home (DOOH), HPC Managed Services, blockchain, and retail analytics software.