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In-vehicle payment systems: How manufacturers can get it right

by Tim Spenny , 28.03.2016

At the 2016 Mobile World Congress, Visa showcased a mobile payment concept with Honda for parking and fuel. Similar initiatives have been announced by Ford for parking payments through its FordPass solution. Parkopedia is rolling this out with other original equipment manufacturers (OEMs) as well. With cars offering a new payment medium, there are many opportunities for manufacturers to differentiate…and fail. How do auto manufacturers, OEMs and even financial services companies design and implement this technology so drivers adopt and value this feature resulting in a leading market position?

The opportunities for payment systems within the connected consumer’s car

There are many applications of payment systems within the connected consumer's car. In the very short-term, vehicles will increasingly be able to pay for services in isolated situations. Some will be passive, such as tolling, and some will be partially passive, such as parking or drive-ins where the car will be an option for payment but will have to be confirmed on a screen.

  • Paying at the pump: This system would involve being recognized by the gas station as you pull up. It registers your loyalty information, the pump is activated and you simply get out and pump. Then, rewards are automatically applied and a receipt is displayed on dash and sent to email. There are also possibilities to incorporate a locator for finding nearest preferred stations or lowest-priced gasoline.
  • Parking: This option promises to identify open parking spaces, automatically pay with your custom time, push notifications to warn when parked time is running out and possibly add time remotely through a mobile phone.
  • Tolls: While there are many states that have automatic tolling, the option to integrate this feature into the car interface is compelling.
  • Food: Imagine a seamless drive-thru experience that offers a restaurant locator, ordering and payment.
  • Car washes: Loyalty programs and automated payments are recognized as you pull up to the facility.
  • Digital personal assistants: More advanced systems will allow a natural voice interface/digital personal assistant (DPA) to pay for tickets for events, flights or car hire in advance while you’re driving – whether this latter category is really your car making the payment (such DPA’s will likely be cross platform) or the car simply facilitates access to these cloud-based services.

First step for manufacturers: understand user expectations, satisfy existing pain points and uncover user requirements

The question is, will consumers prefer to use their car as a form of payment or simply continue to use an application on their phone? Will security and privacy concerns continue to prevent adoption of using your car for making payments in the same way it is stalling adoption and usage of mobile payments? What segments of the market will be more apt to desire this feature? With so many ways to apply new technology, understanding and prioritizing user needs will be the first step towards creating a successful experience. Adoption will depend on how well solutions meet these needs, with the goal of a smooth and seamless experience. Imagine if electronic toll collection, like EZPass, a successful system used for northeastern and midwestern toll roads in the US, required active driver engagement – it would have resulted in much less adoption and success. Similarly, passive features that seem to work as the driver intends (accessing credit cards stored on phones for example) will be seen as extensions of the driving experience and not as disconnected activities. Deciding on the right solution (mobile web, app-based, dashboard or other built-in auto controls) will depend on understand user expectations, satisfying existing pain points and uncovering requirements. Involving drivers and passengers early and throughout the development of these solutions will ensure successful adoption.

Safety first: By enhancing the driving experience, drivers will be delighted and less distracted

As we’ve seen with the introduction of new technologies into the automotive environment, such as heads-up displays or Bluetooth synchronization, the driver’s focus must remain on the driving tasks. And the experience of the new technology should be designed around this foundation. By enhancing the driving experience, rather than competing with it, drivers will be delighted and actually less distracted, with the goal to actually improve safety rather than detract from it. For example, fumbling for a wallet at the drive through or toll takes driver attention from the driving tasks; difficult to use Bluetooth controls can cause focus to be removed from the road, with potentially disastrous effect.

What’s next in ‘car-based payments’?

The connected car space is still very new and players from all ecosystems are trying to find a value proposition to tap into this ecosystem. Initially “car-based payments” will probably fit passive / semi-passive needs, as they are more easily implemented and don’t cause a distraction. As vehicles become more autonomous, the task of driving will become secondary in certain circumstances, leaving drivers free for other tasks. Through this, the car could become a portal to the internet, similar to a phone or tablet. While there are many questions and opportunities for this incredible technology, the winners in the market will be those who not only design the features their users want, but also localize and deliver them the way users expect them to be delivered.

What is your opinion on this topic? Please email me to share your thoughts at Tim.Spenny@gfk.com.

Jack Bergquist, UK Automotive Lead
Lauren Zack, Senior Vice President, User Experience
Tim Spenny, Vice President, Financial Services