What's driving vehicle commerce?

Everything's connected—your refrigerator, vacuum cleaner, house alarm—even your car. As automakers explore advancements in connected-car technology, in-vehicle commerce is gaining momentum.

Market acceleration

While vehicle commerce is a relatively new channel, more connected vehicles enter the market each year. McKinsey anticipates that nearly 95% of new automobiles sold globally will be connected by 2030. And Ptolemus Consulting Group forecasts that 600 million vehicles will generate half a trillion dollars of in-car commerce during this time.

What is vehicle commerce?

It goes by many names—connected-car commerce, in-car commerce, in-vehicle commerce, vehicle commerce. And it starts with connectivity: a connection from your car to the internet.

Getting connected

General Motors (GM) unveiled the first connected car in 1996. Drivers could lock or unlock their doors automatically from remote locations or connect to emergency operators. Today, cars can park—and even drive—themselves.

Further expanding connected-car technology, BMW recently unveiled its color-altering car, the i Vision Dee. Expected to hit the road by 2025, it can change 32 colors based on your mood. And it supports immersive virtual experiences, projecting graphics, avatars and information across your windshield and side windows.

In a more practical use case, connected-car technology lets you purchase goods and services directly through your vehicle. Transactions take place through your car's in-dash navigation system, not your smartphone. Consumers enter their payment information into an app to set up this capability. But the payment technology itself is embedded into your car. This is vehicle commerce.

Vehicle commerce: payments and a whole lot more

Jaguar pioneered vehicle commerce in 2017. UK drivers used PayPal or Apple Pay to purchase fuel from their car's dashboard. Since then, GM has equipped vehicles with an in-dash system that communicates directly with QSRs and gas stations. Drivers or passengers reserve tables at restaurants or order and pay for coffee, movie tickets, fast food, gas, deliveries, parking, office supplies and more.

In 2018, Mercedes designed an app for drivers to purchase services and products, including software upgrades, from their vehicles. That vehicle payment capability morphed into a growing number of features, including navigation systems, charging packages and even a soon-to-be-released package to boost car performance.

In 2019, Honda disclosed its Honda Dream Drive in-car experience, and Sirius XM launched a digital wallet. Like Jaguar and GM, these platforms allow customers to make payments directly from their vehicles.

EVs dominated CES 2023 and are advancing cutting-edge technology that enables vehicle commerce. Tesla drivers already use their dashboard-navigation system to locate and find 40,000+ supercharger stations worldwide and pay for EV charging. They access their Tesla accounts via mobile apps or their vehicles.

Another innovator is ChargePoint. This company offers a network of EV-charging stations that integrate seamlessly into mobile apps or connected cars. Customers can pay or access their accounts through car-sharing, ride-hailing and parking services. And businesses that offer these mobile solutions can partner with EV-charging stations to make their products or services more visible to drivers.

Opportunities for your business

In-vehicle commerce offers many opportunities for your business. And opens doors to new marketing and sales channels. With in-car commerce, you can:

• Improve the customer experience. Let customers pay from the convenience of their car. Integrating your payment solutions into connected-car technology makes your customer experience more convenient and seamless.
• Attract new customers. Advertise your business on commonly used car apps and infotainment systems, such as Pandora, Spotify, Google Maps and Facebook. And drive more customers to your business—online or in person.
• Reward customers. When you add rewards programs to your connected payment solution, you can notify or nudge drivers based on their location or action. Encourage customers to make their first purchase, find a rideshare, refer a friend and more.
• Tap into EVs. As electric vehicles become commonplace, partner with other businesses or apps that support EV charging. Apartment complexes, universities, smart cities, fleets, QSRs, retail, convenience stores—no matter which industry you serve, there are many ways to align your products and services with EVs.

As connected technology continues to accelerate, now is the time to consider how your business can tap into vehicle commerce. The added convenience and enhanced experiences this channel offers consumers create great opportunities to grow your business.

Looking for more industry innovations? View our 2023 Commerce and Payment Trends Report to get the latest insights that help you stay ahead of change. And be sure to subscribe to our Payments in Focus newsletter to get these insights delivered to your inbox.