Should Automakers Start Thinking Like Google?

Author Jeff Jarvis thinks there are lessons Detroit could learn from Google’s success becoming an internet giant. BusinessWeek recently spoke to Jeff who’s new book, ‘What Would Google Do?’ offers some suggestions.

One thing that Google has gotten really good at is opening up its development process to users/consumers. The company uses beta releases as a means to both test new products and in a sense allow consumers to finish them. The feedback Google receives from users can be directly applied to a specific product to make it better. Jeff sees the classic method of how car companies hide their design process as one of the reasons their products miss with consumers. He argues that if the companies were more open and even beta tested their pre production vehicles with consumers, the products would improve. He notes how long it took many companies to realize people wanted to listen to their ipods while driving. None of them thought to install plug in jacks in the radios until many years after the ipod was a mainstream product.

Jeff also suggests that maybe car companies shouldn’t primarily be driven by the business of selling cars. Google for instance makes it’s money off the other platform business that are built on top of it. The real revenue comes from ad sales, not the search function which is core to Google. Google operates in an open source world that allows other business to integrate with the company and become stronger. Jeff says that if Google decided to start a car company it might be very similar to Zipcar. Customers join Zipcar for $50 a month, then make reservations online and pick up a car in any number of garages, paying $9 an hour or $65 a day in New York, including insurance, gas, and 180 miles. The company provides a range of vehicles so customers have the flexibility to selecting the one to fit their needs.

Jeff asked  Rishad Tobaccowala, chief innovation officer of the ad giant Publicis, what business car companies are really in, he said it’s not making cars.

I’m in the business of moving people from place A to place B. How can I do it in different ways? And as they are moving from place A to place B, how do I make them feel secure and connected?” Aside from sleep, we spend more time moving around than at home. And what is the automobile really about? Navigation and entertainment, not necessarily manufacturing. Manufacturing is expensive, vulnerable to commodity pricing, labor-intensive, and competitive.

Jeff goes on to suggest what car companies could become. What if a car company became the leader in getting people around and it used others’ hardware: planes, trains, and automobiles? I tell your system where I need to go and you give me choices at various price points: Today, I can take the train for less. Tomorrow, I can drive because I’m running errands. The day after, I’ll carpool to save money. This weekend, I get a nice Mercedes to take my wife to dinner. Next week, I get a chauffeur-driven car to impress the clients. Along the way, I can pay for options: my entertainment synced in the car, wireless connectivity on the train, alerts to my iPhone, a navigation concierge who directs me around traffic jams. This is the new personal transportation company, a platform built on the old car company model.

Jeff’s Bog: Buzz Machine