Self-driving cars could dampen the consumer love affair with cars and car brands. However, new technology may open new brand building opportunities.

KNOWLEDGE @ BI: Marketing

Fully autonomous vehicles that take all the driving duties away from car passengers will soon be available from most of the world’s automakers and a variety of world famous technology brands such as Google and Apple.

Although a great deal of attention is being paid to the technical and legal issues involved in the adoption of self-driving cars, less attention has been given to branding implications of self-driving technology, and this essay uses branding theory to describe how this exciting new technology could dampen the consumer love affair with cars and car brands that have inspired thousands of car songs over the past 100 years.

The future of not driving

Imagine getting into a car and having the car ask you where you wish to go, and after receiving your instructions it takes you to the office while you productively use the drive time to surf the internet or get a few more minutes of beauty sleep.

After delivering you to work, imagine being able to order the car back home to take your children to school and then park itself in your garage. In the afternoon the car could be instructed to drive itself to the grocery store to pick up a few items you ordered online, and then proceed to school and your workplace to return the entire family back home in time for dinner.

Such experiences will be delivered by self-driving cars, and many of the world’s automakers and leading technology firms are putting major efforts into making fully autonomous cars available for sale as early as 2018.

Love affair with cars

My recently published article in the International Journal of Technology Marketing uses branding theory to predict how self-driving cars might influence the consumer love affair with cars and automotive brands that has inspired over a century of popular songs from Merry Oldsmobile in 1905 to Beamer, Benz or Bentley in 2010

No other man-made product has been the subject of as many popular ‘love songs’ as the automobile and its brands, and the article examines the degree to which self-driving capabilities might cool the relationship that so many consumers have with their chosen car brands.

The article is derived from a case I wrote for my MSc course in New Product Development, and discusses how self-driving cars might change the importance of automobile attributes such as safety, reliability, prestige, and performance, which have been used by engineers, designers, and marketers for decades to create profitable distinctions between brands such as Skoda, Audi, Chevrolet, and Cadillac.

The changing importance of brand attributes

For example, brands such as BMW and Porsche have proven to be very profitable because they are desirably perceived as sporty cars, but consumers may be less likely to pay a premium for performance brands when self-driving cars are programmed to follow all roadway speed limits, and move slowly to avoid causing motion sickness in passengers.

Self-driving cars are also predicted to crash far less often than human driven vehicles, and may therefore reduce the importance of perceived safety advantages offered by brands such as Volvo.

On the other hand, self-driving will likely increase the importance of the infotainment attribute as non-driving passengers seek to be entertained while riding to their destination. Yet popular advantages held by certain self-driving cars are likely to be quickly copied by competitors, and the article suggests that it may become more difficult to create or maintain car brand distinctions as self-driving technology becomes widely adopted.

While autonomous cars might reduce brand equity and profits for automakers, self-driving technology will likely create opportunities for non-automotive brands such as Google and Apple if they follow the ‘Intel-inside’ strategy and supply self-driving technology and entertainment product to automakers.

Self driving implications for car ownership and non-car brands

Self-driving technology might also cool the consumer love affair with car ownership.

Thus instead of owning an expensive vehicle that spends a large portion of its time sitting in the garage, self-driving technology might make it more convenient and cost effective to use rental cars on an as-needed basis.

This may open up brand relationship opportunities for car sharing/rental brands such as Uber, Zipcar, and Hertz, particularly if they can provide service that is competitive with private car ownership in terms of reliability, security, convenience, comfort, and cost.

Profitable brand building opportunities might also be available to other firms that offer products that increase the utility of self-driving vehicles. For example, package delivery businesses such as UPS or FedEx, or home delivery and drive-through businesses such as Dominoes pizza and McDonald’s, may find competitive advantages by allowing passenger-free autonomous cars to pick up and deliver packages and orders.

Fuel stations and car repair facilities may also benefit from developing systems that allow self-driving cars to deliver themselves for refueling or maintenance services without the presence of a human passenger.

Schools and child-care centers may gain competitive advantages by designing systems that allow the safe drop-off and pick-up of children into ‘parentless’ autonomous cars.

Brand building opportunities should also exist for smart phone apps that facilitate such transactions and otherwise increase the utility of self-driving vehicles.

Brand managers who are most adept at finding ways to use their brands to increase the utility of self-driving cars are likely to gain competitive advantage and brand equity, although it remains to be seen if popular songs will be written about Google or Uber self-driving services.

References:
• Olson, Erik L. (2017). Will songs be written about autonomous cars? The implications of self driving technology on consumer brand equity and relationships. International Journal of Technology Marketing, 12 (1), 23-41.
• Olson, Erik L. (2008). The Implications of Platform Sharing on Brand Value. Journal of Product and Brand Management. 17 (4), 244-53.
• Olson, Erik L. and Hans Mathias Thjømøe (2010). How Bureaucrats and Bean Counters Strangled General Motors by Killing its Brands. Journal of Product and Brand Management, 19 (2), 103-113

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