In-vehicle commerce opportunities to drive 775 million connected cars by 2023

A new report from Juniper Research says 775 million consumer vehicles will be connected via telematics or by in-vehicle apps by 2023, rising from 330 million vehicles in 2018. This is an average annual growth of 18.7% over the next five years.

The research group forecasts that automotive original equipment manufacturers (OEMs) will enable in-vehicle infotainment systems to be accessible to third party developers. In turn, this will accelerate expansion of new technologies and services that will increase the value proposition for drivers. In this context, Juniper anticipates the growth of in vehicle voice assistant use, as well as in-vehicle commerce.

The research found that the total spend over connected car eCommerce platforms will reach $265 billion by 2023. In order to cultivate a workable commerce ecosystem, Juniper urged stakeholder collaboration between automotive OEMs, network operators and payment solutions providers. The research group recommends that the provision of APIs and development platforms that enable third party development of payment-capable in-vehicle apps is essential to the creation of new and innovative OEM services.

“Until the market gains new entrants from outside the automotive ecosystem, the increase in transactions will be driven by convenience for the user, rather than the creation of new services themselves,” says research author Sam Barker. “By 2023, we expect that in-vehicle commerce transactions will be less than 1% of mobile and online transactions globally.”

Juniper also forecasts that over 370 million in-vehicle digital voice assistants will be accessed by 2023. However, in-vehicle assistants must be given access to the vehicle’s basic functionality, such as climate control, to offer a differentiation point to smartphone-tethered options. Juniper also forecasts that automotive OEMs will increase this access to vehicle systems, however mitigating risks, including security of data and driver distraction, will remain the highest priority.

The graphic accompanying this article is courtesy of Gigaom.