Determining the influencer in evaluation of connected vehicle

Abstract

In virtue of the advanced technology, various industrial sectors, including high technology electronics sectors, have been experiencing notable paradigm shifts and began to grow together. The paradigm shift led to the introduction of diverse convergent products to the market. Convergent products are defined as products to which a number of various services are added that are demanded by consumers. According to Gartner’s technology hype cycle, it has been well expected that every device will be connected in the near future with the help of ‘Internet of Things (IoT)’. ‘IoT’ is regarded as a term to “describe a system where the Internet is connected to the physical world via ubiquitous sensors”, which would eventually lead to introduction of more convergent products. The rise of ‘IoT’, a novel paradigm, had tremendous impacts on car industries and vehicle manufacturers began to develop ‘connected vehicle’. ‘Connected vehicle’ refers to cars with any applications, services and technologies that connect vehicle to its surroundings such as networks with the help of the embedded devices. Similar to other existing convergent products (i.e. smartphone), diverse functions including wireless network are added to conventional car. Even though there exist several studies about convergent products, no empirical study on ‘connected vehicle’ has been conducted yet. The current study develops a research model, which consists of IT product involvement, car involvement, hedonic and utilitarian values of added functions to connected vehicle, in order to explain the overall perceived value of connected vehicle. An online survey was carried out on adults who drive on a daily basis and total sample size of 500 was obtained. Through multiple regression analysis using SPSS, it was computed that car involvement and IT product involvement positively and significantly influence the overall perceived value of connected vehicle, whereas only a portion of hedonic and utilitarian values forms significant relationships with the perceived value. It was observed that car involvement is more significant compared to IT product involvement which indicates that consumers still perceive the basic function of connected vehicle more important. Furthermore, since added functions are associated relatively more with utilitarian values than hedonic values, most of utilitarian values from added functions have significant influence on the overall perceive value. However only one hedonic value is found to be significant in the research model. Car companies can swiftly increase the overall perceived value by developing and adding functions with hedonic aspects which are more sensitive than utilitarian aspects. This study provides empirical evidences of how consumers perceive connected vehicle and determines what the influencers are.