Customers perceived barriers & motivations to service innovations specific to the adaption of subscription-based services in the automotive sector

Abstract

As car subscription models have been becoming increasingly popular in our society for several years now, more and more car manufacturers and third-party suppliers in the automotive industry are dealing with subscription-based services. When using a car subscription service, the customer pays a fixed monthly fee that covers all incidental costs, fees, insurance, and maintenance. In addition to the vehicle itself, the subscription includes an extensive service portfolio. The aim of this master’s thesis is to empirically identify barriers to and motives for using or not using subscription-based services in the automotive industry in people from different age groups in German society. There are no scientific publications on age-specific barriers to and motives for using car subscriptions; therefore, this thesis aims to identify these barriers and motives by conducting qualitative focus group interviews. The focus group interview results showed that there is a generally high level of interest in and market potential for car subscriptions; additionally, there is an extremely low level of awareness about car subscriptions across all age groups. Depending on the age group, the identified barriers and motives varied in perceived relevance, and no uniform pattern could be identified across all surveyed generations. This thesis paper provides an overview of the age group– specific factors that influence how car subscription services are perceived, particularly focusing on the extreme discrepancy between urban and rural needs for this service. This thesis is of interest to car manufacturers, third-party providers, and start-ups that intend to optimize their service based on age group–specific requirements and customize their market penetration strategies to the individual needs of age groups.