John Waraniak, vice president of vehicle technology for the Specialty Equipment Market Association (SEMA), talks to TU’s Susan Kuchinskas about why OEMs need to focus on context as well as content
John Waraniak, vice president of vehicle technology for the Specialty Equipment Market Association (SEMA), has tinkered with machines since he was a kid scouring the neighbors' garbage for parts for his contraptions. He worked on the B-2 Spirit stealth bomber project, then moved to Hughes Aircraft to oversee technology transfers between Hughes and its parent, GM, via Chevrolet's racing division. Waraniak is an avid fan of racing of all kinds, although an early back injury permanently sidelined him. In 1992, he joined t-shirt maker No Fear as COO, helping it grow to $120 million in annual revenue.
Waraniak's love of what he calls "systems thinking" drew him back to the automotive world as vehicles are set to become hyper-complex systems that act as nodes on the Internet. "Winning corporations define winning as the commitment to continuously improving their collective ability to satisfy customers faster, better and more profitably than anyone else," he says.
What is the future of automotive apps?
It's not about content as much as it is about context. Product content gets you into the market, but that's only about 10 percent of a customer's decision. Consumers buy on emotion and justify with logic. The design thinking and prod content are what the rational side of the brain justifies a buying decision with, but the emotion is ten times bigger. That's the context.
When it comes to the context, part of it is driver distraction. Another part is, ‘Is it cool?’ That's where SEMA comes in. SEMA is part of the performance automotive auto market: fast cars. Kids who are 10 to 24 years old, they want not just fast cars; they want smart cars. (For more on distraction, see DOT’s distraction guidelines as challenge and opportunity, What DOT’s new distraction guidelines mean for telematics and Distraction guidelines as a telematics business opportunity.)
SEMA's role is to make connectivity cool. That's the context I've been an evangelist for, for the last ten years. For example, OnStar entered the market ten years ago, and it was all about the rational side of design thinking: safety. Ford made connectivity cool. Sync is all about infotainment. That's the difference between content and context. Generation X and even Baby Boomers still want context, they still want to be cool like a 25-year-old. Consumers will decide which of those apps become the apps of choice.
Automakers are reluctant to give consumers a wide choice of apps, though.
Right, the app has to be in the background. Perhaps the ultimate solution is the Google car, where you leave the driving to the vehicle. To many kids, driving is the distraction. Say you have an autonomous system, auto companies will be glad to put those systems in if they integrate well with the rest of the systems.
To what market trends do your organization's members need to respond?
There are four mega-trends driving the auto industry: driving green, connected, safe and cool. They are blending together in a hybrid model. For example, take the Chevy Volt. That's green performance, and you have to be connected to know where your next charging station is. Connectivity ties into safety extremely well.
SEMA is working with RITA leadership to promote the aftermarket industry’s contributions to deploying V2V and onboard technologies. Are your members looking to vehicle-to-vehicle technology in general, and specifically the Safety Model Deployment under way, to open new markets and/or increase sales and opportunities?
Absolutely. Anything that makes the car cool! When someone builds a custom car for a celebrity today, they have to have the performance, the horsepower. But they better have 4G; 4G trumps a V-8 in many cases. It has to have touch screens, ultra connectivity, every haptic you can think of. Technology is 40 percent of the equation. (For more on vehicle-to-vehicle technology, see Special report: Telematics and V2V/V2X technologies.)
What are the challenges faced by members of your organization specifically relating to connected-car services and infotainment? Are there regulatory barriers to this sector?
It's a mixture of old school and new school. Mechanics is not just crawling under the car with a wrench and a hammer. You need the ability to re-flash drives and re-code software. There's a new generation of installers and mechanics as well as people who understand how these systems interoperate. You have to understand the systems of systems. Organizations like CEA and MIRA and SEMA are picking that up. Engineering schools also understand the systems of systems better than previous generations.
The SEMA Awards, recognizing the top trend-setting vehicle models, will be announced during the 2012 SEMA Show, October 30 through November 2. What are some trends you see?
One is the context. An example is the Jeep, which won the SEMA award for 4x4 several times. It has the ability to be customized. When they allow you to make the Jeep your way, that's the context of the Jeep.
There's a metric that Jim Farley [formerly at Lexus, now global vice president at Ford] came up with. He would walk floor at the SEMA show and count the number of Toyotas that were customized, then he would subtract the ones he paid for. He realized that the real metric was whether it was the vehicle of choice to be customized. That's what the SEMA award is about: letting consumers decide what is the most customizable car out there. I submit that connectivity—the content—is the prerequisite. The context is the one that decides who the winners are.
Susan Kuchinskasis a regular contributor to TU.
For more on telematics, context and content, see Special report: Telematics and apps.
For everything app-related, visit Content and Apps for Automotive USA 2012 on December 4-5 in San Diego.
For all the latest telematics trends, check out Telematics Japan 2012 on October 9-11 in Tokyo, Telematics Munich 2012 on October 29-30 and Telematics for Fleet Management USA 2012 on November 13-14 in Atlanta.
For exclusive telematics business analysis and insight, check out TU’s reports: In-Vehicle Smartphone Integration Report, Human Machine Interface Technologies and Smart Vehicle Technology: The Future of Insurance Telematics.
In the second of a two-part series, Susan Kuchinskas reports on making in-car apps pay.
In the first of a two-part series, Susan Kuchinskas reports on making in-car apps pay.
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