BMW Moves Digital Transformation Into The Fast Lane

In the past, the German vehicle manufacturer knew about every car, according to its SVP of customer-centric sales development. In the future, it wants to know the customer.

Rainer Feurer is in charge of customer-centric sales development and customer experience. This means he is driving BMW’s transformation towards a seamless omnichannel experience for its customers and overseeing the development of not only its online and digital channels but also the physical channels.

We interviewed Feurer at Adobe Summit EMEA 2017 to find out more about BMW’s digital transformation.

Rainer Feurer: Our industry is fundamentally changing. Cars in the future will be autonomous, they will be connected, electric, and shared, but also the customer interface is changing massively. In the past, we were working with dealer networks to sell cars. In the future, we’ll be looking much more at the individual customer and what that customer needs during their entire lifetime.

What we’re looking at right now is the moment of transformation for BMW, from a car-centric approach to a customer-centric approach.

CMO.com: What does a customer-centric approach look like for BMW?

Feurer: It means that while, in the past, we knew about every car in detail, thanks to the vehicle identification number. In the future, we want to know the customer. We want to provide personalised individual offers throughout their lifetime—whatever the customer needs at every point in their life.

CMO.com: How are you going about addressing the individual customer, and how is that changing the business?

Feurer: First, we need to integrate the web channels and social media. Second, we need to integrate all the information from the dealer network. Then, in the future, we will know how the customer uses our cars. Right now, we’re building up the digital asset, which we can directly use to interact with the customer. We’re building up a web presence, which will then move towards an interface, where the customer can do whatever they would have achieved at a dealership, directly at the touch of a fingertip from their own screen.

CMO.com: Can you talk a bit more about your ideas on the “online showroom?”

Feurer: In the past, a customer visited a dealership four times prior to a sale. Today, they’re only going 1.4 times to a dealership—but they’re 97% pre-informed. In the past two years, we’ve changed our web presence, moving it to a future-proofed, standardised solution, which allows us to develop and deploy new functionalities on a worldwide scale. The next step in our transformation is towards a transaction channel.

In the U.K, our website allows a customer to purchase a car within 10 minutes, at any time of the day, while also offering a consultation service. We help them to find out what they really need. We use analytics to provide a preconfigured car for the customer. We also provide online chat, the ability to trade in their used car, and financing. The customer can then select a down payment and the monthly leasing rate to make it adaptable to their needs, and, if the customer is ready, we can also provide an online transaction.

CMO.com: How is this changing the relationship between BMW and its customers?

Feurer: For the customer, this means they can basically have the service at the time and place they want. Some customers use it in the morning at 7am, when typically dealerships would not even have opened. They can do it at home, maybe at 10 o’clock in the evening, when the kids are in bed. It’s more convenient for the customer—they have more time and freedom. And, for us, it means much more data.

CMO.com: How do you see that relationship with customers evolving, particularly as cars become more connected?

Feurer: We will move into new services and after-sales. We’ll use the data we have to provide various services in our customers’ daily lives, from parking services or charging services, all the way to helping in their mobility needs. We are already the biggest provider of parking services and charging services worldwide, and we have the vision that, by 2025, we want to get a customer base of 100 million customers for different services around individual mobility.

CMO.com: How do you envisage the transformation impacting the way you acquire customers?

Feurer: Customers want the one-on-one approach, and that transforms everything: from marketing—where we are moving away from classic product marketing to direct marketing—all the way to servicing the customer and the way we sell cars.

So, basically, transformation is not just in one function. It’s a transformation of the whole company and the approach we take towards the customer.

Of course, data will allow us to personalise every aspect, be it a webpage that we can highly individualise, be it messaging in marketing that we can tailor to certain groups, all the way to making offers to a customer, maybe at the end of a lease. We know exactly when a car lease expires, and we can make a very personal offer to a customer based on their use of the car and their financing needs, which was not possible in the past.

Moving forward, the car is also changing. We’ll be able to update the car with software on a regular basis, which will allow us to sell additional services in the life cycle of the car. For example, 27% of the traffic on Saturday mornings is car park-searching traffic. So, in the future, you’ll be able to just input the destination, and the car will tell you where a parking space is. You book it in, you just drive there, the parking lot will recognise you, open the door, and you’re in. We can use technology and digitalisation to take care of a lot of the pain points the customers have in their journeys.

CMO.com: How is all this changing the skillset within the marketing department?

Feurer: The change in our company is huge, and it’s not only within the marketing department. It goes throughout all functions in the company. In the future, we will need completely new skillsets—we are looking at data analysts and architects, but we are also looking at a completely new way of how we approach things.

In the past, we did product training when a new car was released. Moving to a world where we have continuous upgrades of the cars, we now need to move to continuous training. So we need to train our sales and service people on a regular basis, and that is a complete transformation. Two years ago, we created a web club-based training platform, which allows us to basically give information on a new feature to 230,000 people worldwide.

CMO.com: What are the key lessons you’ve learnt so far on the journey?

Feurer: Well, the key lesson for me is that it’s not just technology. Mostly, it’s the change in the processes, and, above all, people and the mindset. It’s a journey. We are a company that is successful, we are 100 years old, and changing our organisation will not work overnight.

It’s a gradual change throughout a number of years, and I think you need to have a strong drive, you need a strong customer orientation, but you also need to be aware that this will not happen overnight, so you need to have some endurance.

CMO.com: How do you incorporate and monitor innovation in the company?

Feurer: Innovation for the journey ahead is key. Every department needs to have the possibility to innovate and do things themselves. We also need to scout, in a structured way, what innovations are out there because, pragmatically, we cannot do everything ourselves.

In certain areas, we’re scanning the market for great companies we can integrate, while really investing strongly in skills we need for the future.

CMO.com: How do you envisage the car as a media space?

Feurer: The car in the future will be completely connected, and that’s why a lot of companies are looking at how they can best use the time a customer sits in the car. I think there are two facets to this. One is how the car interacts with the environment, so we can provide services that will help the driver use the car. On the other side, we can now look at how we integrate services into the journey, and that means we need to integrate third parties into the car itself, and, in a sense, the car will become a completely digital asset in the future.

We’ve already introduced Alexa, so you can ask what’s the charging status of my i3 or book a service appointment just through voice. We can then link the car together with the dealership to ensure that we have a service appointment available.

Moving five years down the road, if you buy an autonomous car, it might just go for a service tonight without you being in the car, so service becomes completely invisible in the future.

CMO.com: What are the next steps for BMW in this journey?

Feurer: The journey is manyfold. First, the car will become autonomous. It will be completely connected, it will become electric, and sharing will be part of this story, be it car-sharing or integrating other sharing platforms with the car.

Second, we are creating a seamless link between the customer, the car, and other digital assets. And the third is that we need to integrate the physical world, because we’re convinced that, in the long run, it’s neither online or offline, but that we are creating a seamless journey for the customer. So we’ll also change the physical world into a complete, integrated, seamless, omnichannel experience.