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Drive My Car (Please?)

The automobile industry is in the midst of a huge transition. Consumers who were once lured into purchase decisions by iconic designs, strong brands, or high performance ratings now want all that and more. As today's drivers spend increasing amounts of time on the road, they crave vehicles that complement their always-on, hypermobile lifestyles and that support the car as a makeshift office, an entertainment center for the kids, and a cargo hold for their inner weekend warrior.

Industry innovators are getting onboard, looking at changing behavior, cultural trends, technological shifts, and analogous industries to figure out how best to meet consumer needs. The automakers that successfully make cars "do" more—in other words, deliver smart, personalized services to drivers on demand—stand the best chance of setting themselves apart from the competition. The most sought-after vehicles will be those that act as just another node in a driver's existing network of devices. The connected car experience is the new reality. Here are a few of the early offerings to hit the market.

Inside the Connected Car

Increasingly, the "connected car" is putting people directly in control of their digital lives while they're behind the wheel. Early this year, Ford (F) announced an integrated "driver experience" for its Ford, Lincoln, and Mercury vehicles. MyFord Touch connects the driver's phone, media, navigation, and vehicle settings via one seamless interface controlled by touch or voice commands. No more missed calls or fumbling for your iPod while you're on the highway.

IDEO participated in the initial development of the MyFord system, and through that I've come to believe that the next generation of connected experiences will likely disrupt this model further by embracing a more "open" approach to innovation: dashboards that are customized by drivers. Imagine, for instance, being able to choose your car's software from a store full of applications developed by automakers, third parties, or even consumers. In other words, the car is becoming a technology platform that evolves with us over time.

Better still, these offerings should allow for safer driving. As connected experiences become more embedded and natural to use, drivers will be able to keep their eyes and attention on the road, rather than on the dashboard or audio-control system. GM recently unveiled a windshield concept in which an interior coating turns the entire piece of glass into a heads-up display. By integrating devices, media, and vehicle sensors into the system, GM can present contextually relevant information, such as road warnings and navigational information in the driver's line of sight with the road. While it may be a few years before any of these developments reach their full potential, it's clear that smart use of technology will ultimately allow drivers to stay connected, on their own terms.

From Connected Car to Connected Ownership

Connected cars have the ability to build histories of vehicle performance, movement patterns, and even the driver's purchase preferences. The data collected from the car and all those connected mobile devices present automakers and third parties with opportunities to develop unique products and services. The possibilities extend well beyond driving into the wider experience of car ownership and, by providing more positive touch points, have the potential to convert consumers into brand loyalists.

BMW's Teleservice collects driver data to improve the experience at the dealer—a moment that's often one of frustration and disappointment for consumers. Teleservice actively monitors each auto's maintenance needs, recording potential problems, and when needed, calling the vehicle's owner to schedule an appointment. The data that have already been collected keep faultfinding, reducing time at the service center to a minimum, something most customers can appreciate.

Alternately, Fiat's Web-based EcoDrive service analyzes driving behavior, rating it on a simple scale and making actionable recommendations about what the driver might do differently to improve fuel economy. EcoDrive also lets car owners rate their performance against other Fiat drivers within their community of users. It's like Nike+ for cars—and the healthy competition provides incentive for participation. Fiat claims that the system could improve efficiency figures up to 15 percent.

Third parties are already getting in on the game. Progressive Insurance's MyRate pilot scheme uses data from a connected vehicle, such as how often and how far it's driven, to calculate a customer's monthly premium.

This is just the beginning. Imagine the possibilities as the auto industry's ability to process data and synthesize patterns improves. Could car companies monitor and promote safer, or more economical, driving behavior through new incentive programs? Or perhaps, one day, your daily latte order may be ready and waiting when you pull into the coffeehouse's parking lot—a perk for which people might pay extra.

a trends and innovation company that publishes a daily news site, hosts idea-generating events around the world, and provides trend research and innovation consulting to companies such as Apple, BMW, and Target.

Iain Roberts co-leads IDEO's Chicago studio and is responsible for managing client relationships with Fortune 500 executives. He has worked on design and strategy with companies including AT&T, Ford, Kraft, and Motorola.

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