Connected cars are the future. About 100 million are already on the road worldwide, and BI Intelligence expects that number to almost triple to 293 million by 2025. It’s not surprising that they’re becoming increasingly popular. People are addicted to their phones — almost one-third of US smartphone owners report feeling anxious when they can’t access their devices — but using them is dangerous (and in many places illegal) while driving. Connected cars, which feature touch-screen interfaces and mobile broadband connectivity bundled together into "infotainment centers," give drivers access to many of the features that make smartphones a digital lifeline, and all without taking their eyes off the road.
Digital payments are one of the biggest untapped opportunities in the connected car. With infotainment systems bringing streaming media, navigation, and chat apps into the car, companies have gained a new marketing channel and a captive audience of drivers and passengers. But they haven’t yet been able to leverage them for commerce or payments opportunities, even though it's a logical next step:
- There are a lot of things to pay for from within your car. Some of these are directly related to driving — think gas, tolls, and parking. But there’s an even broader opportunity to bring e-commerce into the connected car. Given advancements in logistics and fulfillment, drivers and passengers could buy goods online and pick them up at a store along their routes or have them delivered to their destinations by the time they arrive.
- And there’s a lot of time to make these payments. Eighty-six percent of Americans commute by car daily, spending roughly a full week’s worth of time sitting in traffic every year. If consumers could make payments during their commutes, they'd save time on errands later, and firms could capitalize on user boredom.
Connected cars could give consumers the frictionless payments they want. Over 60% of consumers find purchasing inefficient, unproductive, and time-consuming — things that the simplicity of a car-based system could resolve by allowing consumers to be more efficient while driving safely. [...]