What’s wrong with (mobile) telematics?
Few weeks ago we decided to close down Road Skippers — a telematics app that monitors drivers (where, when and when they drove), scores their driving, and informs and incentivizes them to drive better. People keep asking me why we did it. Here is a short article that explains it.
Traditionally telematics was realized with a “black box” or a OBD-II device installed in a car that collects and transmits data on vehicle use, maintenance requirements and automotive servicing. Since smartphones are our supercomputers, companies stareted using them as a tool that monitors vehicles activities. “Mobile telematics” is appealing, it’s cheap and easy to install but it has its flaws.
Technical difficulties
At Road Skippers we applied smartphone-as-a-sensor concept, where we used built-in sensors (GSP, accelerometer, gyroscope) to assess vehicle’s activity. It worked but it’s challenging.
Building a reliable telematics app requires team of highly skilled data scientists and software engineers, specialized in machine learning to make your signal processing work and your app to work in every condition. A telematics app in’s not just an engaging interface but it should be a powerful tool that gathers a robust data about how a car is being used.
Making sure that your data acquisition and analysis services work on every new phone and for every new OS version is also challenging. Both Apple and Google do not make our life easier as they limit background services, and they heavily optimize battery usage. So constant and costly battle. I don’t say it’s not possible and some companies are doing a great job like TrueMotion, CMT or Sentiance. But there is another catch …
Reliability
Smartphones can gather all the information related to car movement (speed, acceleration, braking, turning) but cannot offer technical information about fuel, energy use (in case of EV) or maintenance data. This info might not be important for B2C business case like UBI but might be crucial for services like fleet management.
Continuous monitoring might also be a problem. Smartphone’s battery might be flat or a driver might stop your telematics service. It means that you might have a limited set of trips and not a full picture of your car’ and a driver’s activities. You can for instance use gamification to incentivize drivers to record all the trips and it might be very effective in B2C context but not necessarily in B2B context like fleet management.
Business case
Road Skippers started in 2015, and it was a free app that rewarded users for driving well. We combined driving analytics, personalized feedback and gamification and it helped us attract 10.000 users, out of which around 65% improved driving behavior. Great, but how to make it financially viable. Road Skippers allowed companies to interact with users (as sponsors) and to use Road Skippers as an app for their own customers and employees (we introduced private groups)- more here. We had a pleasure to work with organizations like KBC Group, Mobile Vikings, Leaseplan, Volvo cars, Accenture, P&V Assurance, LSA Courtage, Baloise, Belgian Road Safety Institute or Ministry of Transportation in Belgium.
What went wrong?
User engagement — using smartphone boosts retention but not for long. If there is no viable service behind the app (fleet management or insurance policy) the retention is low. In our case we managed to keep our users engaged for not more than 6 months. For only around 10%-15 of all users becoming a better driver was an important incentive, all the rest wanted to be rewarded for their improvement. So it can be costly and short-sighted. Where does it work well? Prevention campaigns like this — https://press.vivadrive.io/road-vikings-when-football-meets-road-safety#. It is short, engaging and has very positive effects. Loyalty programs (insurance, leasing, dealership, …) but probably not for full-blown Usage-Based Insurance program, where rates are based on telematics data.
Business expectations — companies expected continuous monitoring and reliable car data (fuel, service) that a smartphone cannot offer.
So when mobile telematics is a good choice?
- event-based approach — you want to engage your drivers for a short period of time e.g. a prevention campaign
- soft-telematics — you do not need ‘hard’ telematics data (fuel, maintenance, all trips coverage) for your service e.g. loyalty program that probably does not run for ever — it’s difficult and expensive to keep user engage for a long period of time.
We decided that service like Road Skippers is rather expensive to run and not scalable. It helped us learn a lot about telematics, and we had a chance to realize a lot of great project but finally we decided to pivot and switch our business model to B2B.
As a result we launched Digital Fleet — a cost optimization service for traditional and new fleet services. We decided to switch to OBD-II and black box technologies, take advantage of AI and Big Data technologies, include monitoring for Electric Vehicles and create a very effective tool that helps companies optimize TCO cost and modernize company’s car parks.
If you have any questions about our experience and our service, feel free to contact me at mat@vivadrive.io or book a short call via this link.
