GM CEO Dan Akerson thinks there’s one problem with his company’s cars: They don’t make enough money from their owners. So his company’s hard at work to remedy that– by turning them into smartphones on wheels, complete with streaming video and paid advertising, by the 2015 model year, according to a May 9 MediaPost Marketing Daily report (link not available).
The car maker already takes in about $1.5 billion a year from its OnStar safety and security system, but to Akerson that’s chump change. “We have never been properly compensated,” he complained, so GM will be changing OnStar to “make some real money.” While he wouldn’t say just what those changes might be, he did say, “We do want to change this from a safety and security business to one that is much more feature-rich.”
But OnStar won’t be the only thing changing.
By mid-2014, Reuters reports, GM “will start selling internet-capable vehicles that GM says allow passengers in the backseat to watch streaming video,” complete with streaming commercials. By 2015, most Chevrolets, Buicks, GMCs and Cadillacs will also have “4G LTE mobile broadband.”
‘Brought to you by Allstate’
“For example,” Akerson enthused, “what happens if when the logo shows up on your screen, it says ‘brought to you by Allstate’? How many times is that going to pop? And how much can you get from Allstate?”
Whatever they get from Allstate (and other advertisers), they also plan to get $20 from each car buyer who signs up for this internet service.
Akerson thinks this will provide a lucrative advertising medium to a captive audience that spends an average of four hours a week driving to and from work. But his scheme has some disconnects as reported.
One is that while this new automotive advertising medium serves the back seat (for obvious safety reasons), people who drive to work do so from the front seat. And despite pressures to carpool to save energy and decrease congestion, most drivers don’t have backseat passengers. So who’s going to see the ads – and pay an extra $20 for the dubious privilege of having them where they can’t see them??
Another is that “GM risks alienating customers with ads in the car. But those concerns may be outweighed by the convenience of the new service, which will include access to real-time navigation and traffic information.”
Driving while distracted
So if you’re driving to work, in the front seat, you’re going to get your real-time traffic information from the back seat?
Or will your 4G LTE mobile broadband be up front with you, where its distracting screen can pose the kind of safety hazard that’s caused more than 36 states to pass distracted driving laws of one sort or another?
Ten states, plus Puerto Rico, Guam, and the US Virgin Islands, already outlaw handheld cell phones while driving; 39 states ban text messaging (both sending and receiving) while driving. Many states’ police reports even list electronic equipment distraction a category of car crash causes.
As Akerson said, “”We do want to change this from a safety and security business.”
Potential advertiser Allstate may not be thrilled with the extra damages they might have to pay out because the advertising medium that carries their in-car video commercials causes accidents. But then again, GM may make more money selling replacement cars.
It looks as if the visions of dollar signs dancing in his head may have distracted Akerson from seeing some realities out on the road – particularly during commuter drive time.
Make your marketing more effective. Visit www.BrightOrangeAdv.com/how-to-stand-out/