Why streamlining subscription services is key to unlocking the potential of connected services offerings
- Jason France
- Jul 24
- 3 min read
Updated: Jul 25
As automotive companies look to make their connected services offerings profitable, North American and European markets are seeing some automakers push toward simplified and consolidated bundled offerings.
The current market approach of fully customized packages and a-la-carte configurable options is too often convoluted to customers and can lead to feelings of being 'nickel-dimed' after the purchase of their vehicle. There have been several brands that have made recent pivots toward streamlining their connected services. These streamlined packages and extended complimentary periods show that OEMs have listened to their customers and are looking to invite buyers into their connected ecosystem at the time of purchase instead of a barrage of subscription inquiries post-sale.
"Through our qualitative and quantitative consumer research, we consistently observe a clear desire for simplicity and fewer overwhelming choices. Consumers tend to prioritize high-value features such as navigation, safety, and security when making purchase decisions. However, the growing number of options, coupled with rapid innovation and varied pricing models (one-time fees vs. subscriptions), has made decision-making significantly more complex. This confusion creates friction between OEMs and customers, ultimately reducing purchase likelihood and diminishing positive word-of-mouth about the brand."
More robust and feature-rich base connected service offerings are being included complimentary for longer terms with the purchase of new vehicles across multiple OEMs, as many as 8 and 10 years. This represents a pivot toward including more of the associated service costs into vehicle MSRPs as opposed to monthly subscriptions – which is directionally correct given negative consumer sentiments surrounding subscriptions.
In the US, Stellantis recently announced restructuring of their offered connected services, consolidating their strategy to be one set of services across their entire family of brands. Stellantis will now offer only two packages:
A complementary base package for 10 years including OTA, vehicle health alerts, in-vehicle gaming, digital key, and more
A premium subscription connectivity package including stolen vehicle tracking, Wi-Fi hotspot, connected navigation, and more.
Most premium subscription packages are still offered for shorter terms (1 year or less), but we see some premium connected features being offered for longer free trials like Lincoln offering 4 year complementary access to BlueCruise, Ford’s hands-free highway driving feature, for higher trims.
These evolutions of strategy lay the foundation for OEMs to engage their customers and organically offers customers a chance to utilize and embrace automakers’ connected services environments. Leading companies offer a base level of engagement with a complementary set of connected features to provide a foot in the door to convert users to subscription bundles for their premium subscription content.
Critically, the strategy of embedding base level connectivity packages into the vehicle sale price satiates customer desires of having one up-front price. Of course, there is an underlying assumption that automakers have competitive feature offerings included in the complimentary bundles to entice vehicle purchase and engaging security/remote/ADAS/L2+/etc. feature sets to elicit premium subscriptions.
We expect to see continued simplification of offerings with more comprehensive complimentary long-term bundling packages with optional enhanced premium subscription services in the coming few years.
Based on consumer feedback related to automotive subscription models, refined 'simple bundle' offerings will be a positive shift toward consumer engagement and will lead to enhanced opportunities for organic subscription revenue opportunities.
