Share

Connected Cars Edge Out Fitness Trackers In IoT Popularity

Internet users prefer riding to wearing when it comes to their connected devices, an eMarketer report finds.

As Apple, Google, Microsoft, and Amazon vie to be the central provider of consumers’ connected homes, it would appear that the clearest path to stoke the public’s interest in the Internet of Things is through their wheels, not the living room, an eMarketer report suggests.

The Internet of Things for Smart Cars: Accelerating on the Information Superhighway cites a survey by Vormetric last year that found 24 percent of online users had a connected car, with 18 percent of respondents saying they had a wearable device. “Smart” home security cameras/systems, thermostats, lightbulbs, and watches followed with roughly 7-to-9 percent of consumers saying they owned such a device.

Connected cars will play an integral role in the expansion of IoT, and eMarketer’s report has a raft of stats to back that up.

Looking ahead, connected cars are expected to make up 75 percent of total car shipments worldwide in 2020, compared with just 13 percent in 2015, eMarketer estimates.

But even this year, the connected car is already establishing itself as the primary IoT product.

“Recent statistics show that the market for connected cars in 2017 is hovering around $52 billion, up from $45 billion in 2016,” the report quotes James Peters, VP of automotive and connected car at Cisco Systems, as saying. “That number will continue to grow at an extremely rapid rate, and the market is expected to reach $155 billion by 2022.”

As connected car gains mainstream appeal, it’s also important to consider what kind of “connection” is involved.

Embedded Vs. Tethered

The report distinguishes the trend toward “embedded, rather than tethered, connectivity” — the idea that consumers won’t have to purchase additional technology to make their cars, TVs, thermostats, etc., work as interactive extensions.

For example, Gartner estimates that 12.4 million connected cars were manufactured worldwide in 2015, and nearly 61 million would be manufactured in 2020. By then, the firm expects the balance will have shifted from a majority relying on a tethered mobile device to those with embedded mobility.

Still, there is some distance between the technology people want, and knowing how to get the most out of them.

“Many drivers are put off by embedded connected features because they often require subscription services, which are perceived as expensive extras,” eMarketer says. “Instead, drivers often forgo these services and rely on their smartphones’ capabilities, as for mapping.”

In March 2017, Parks Associates found that while 92 percent of US car owners said they performed activities that relied on internet or mobile connections while driving, a large portion of their online access took place via personal mobile devices.

The company had previously reported in a June 2016 blog post that 45 percent of car owners it surveyed who owned a smartphone used it to directly access maps
and navigation while driving.

Conversely, only 12 percent who used built-in vehicle capabilities, while 11percent who connected their smartphone to their car to perform the same things.

“Cars are still one of the IoT devices that smartphone owners connect to the most,” eMarketer notes, pointing to an August 2016 IAB study found that 65 percent of those who owned a connected car connected it to a mobile device daily.

Perhaps consumers just need time to catch up to all the changes surrounding the rise of IoT and connected cars, says Steve Koenig, senior director of market research at the Consumer Technology Association (CTA)

“Some customers are uninitiated to these advanced systems,” eMarketer quotes Koenig on the issue. “But when they go to the dealer, take a test drive, get a demonstration and learn more about it, they largely endorse them.”

 

About The Author
David Kaplan David Kaplan @davidakaplan

A New York City-based journalist for over 20 years, David Kaplan is managing editor of GeoMarketing.com. A former editor and reporter at AdExchanger, paidContent, Adweek and MediaPost.