For many of us, our car is perhaps the costliest depreciating-asset we ever own. So logically, we expect it to last longer and perform at its best in order to keep the running costs low. And yet a car owner often finds himself struggling to get best solutions when it comes to his day to day needs. But lately through the use of technology as an enabler of change, many pain-points are slowly but surely improving towards a better auto-aftermarket world.
There are four main types of needs that arise during the ownership of a car, namely: Regulatory Needs (insurance, registration etc), Recurring Needs (fuel, servicing, tyres etc), Car-Care Needs (wash, painting, accessories etc) and Emergency Needs (repairs, battery, recovery etc). Hence interaction with many service providers is routinely essential to fulfill these needs. Now while the auto industry was evolving rapidly over the last century, all the glamour was focused on the new car sales. While this was understandable so far, things are starting to turn dramatically – primarily fueled by the sharp dip in new car sales seen over the past few years now. Manufacturers are finally waking up the huge potential that lies in the service and maintenance of car-parc that is growing in its vintage. However what’s really propelling the transformation in the auto aftermarket is the rise in technology based revamp of processes and practices in this sector.
First and foremost, technology enables a ‘smarter’ supply chain of all consumables as they travel from overseas manufacturers to the actual car owners (commonly known as B2B2C model). There are several advantages of this transformation to all stakeholders – check on counterfeits, improvement in pricing for car owners as well as garages through demand aggregation, standardization of quality, data backed procurement & feedback loop, organic growth of demand, brand development to name a few. The way its being presented to car owners is also interesting – a special hybrid model of installation based ecommerce can be offered as per the need of the industry. Lately Amazon is also pushing a similar model through its Automotive Services.
When it comes to car owner’s experience, technology adds a big punch in the service offering. The lack of transparency and trust was always a major dampener in selection of a service provider from the unorganized and unbranded aftermarket. So much so that people used to consider selling off their cars immediately after expiry of warranty period provided by manufacturer. However the depreciation rate drops very low as years pass by and so a well maintained car is a great cost saver; not to mention all cars are meant to last for at least 12 years or 350,000 KM. Through use of technology, there is a huge potential for the 17000+ car workshops in UAE to be aggregated conveniently as per their individual expertise, pricing, location, ratings etc. This way user builds trust and get a standardized channel of communication that is commonly referred as a marketplace. Such models have been successfully developed and have grown in the west – whocanfixmycar based in UK is one such example that claims to have 15000+ car workshops serving through its portal.
Location tracking technology is also being optimally used by service providers to come up with relevant use-cases that simplify a car owner’s life. It allows for certain type of quick-services to be performed at user-location while giving a seamless digital experience from order booking to delivery. A good example in this category is CAFU, which offers at-location fuel filling service to car owners. There can be several use-cases of this technology and in the current times due to Covid concerns, the availability of contactless/ at-home experience is highly desired by users.
These are just a few of the ways in which the aftermarket industry is coming up the technology curve in UAE as well as larger region. The critical need for enabling technology to improve processes and service offering is now fully realized by the entire automotive ecosystem and ingenious ways are being continuously introduced towards a more efficient aftermarket that is not just an after-effect of the sale of a new car – but is actually a strong revenue driver and backbone of the larger automotive industry.
Author: Gaurav Sharma, Founder, Open Bonnet
Identifying the need for improvement in Auto Aftermarket sector, Gaurav Sharma founded Open Bonnet in late 2019. Open Bonnet is a fully digitalized marketplace for auto aftermarket service providers and connects them directly to the car owners through a platform that focuses on delivering quality & convenience as the key value proposition. Open Bonnet aspires to be a central player in the Automotive Aftermarket by improving processes & standards prevailing in this sector through the use of technology. Prior to founding his maiden start-up, Gaurav worked as a consumer business specialist with some major brands in the banking sector for over a decade where he was creating & monitoring strong value propositions and their go-to-market strategy.