FordPay Could Be the Key to More than Payments

Ford is repositioning itself as a mobility company – and that means plenty of mobile apps, services and partners, plus a mobile wallet. Susan Kuchinskas investigates whether this morph makes sense.

At the North American International Auto Show, Ford Motor announced FordPass, an auto-centric lifestyle offering aimed at millennials. The initiative, set to go live in April, wants to reposition the automaker as a mobility company serving people who aren't Ford owners as well as those who are.

At the NAIAS launch event in Detroit, Ford CEO Mark Fields told journalists that Ford wants to revolutionize the customer experience in the auto industry in the same way that Apple transformed the mobile phone industry. FordPass is a hybrid of mobile and real-world services. It consists of:

  • FordGuides, an OnStar-like service that lets members get directions and advice from call center personnel
  • FordHubs, Apple-store like locations that showcase Ford vehicles
  • Marketplace, a curated app store
  • Appreciation, a loyalty program launching with 7-Eleven and McDonalds
  • FordPay, a mobile wallet Ford said was designed to pay for "mobility expenses"

With mobile wallets proliferating like rabbits in the springtime, does FordPay have a chance of adoption? After all, even Google hasn’t made much of a go with Google Wallet, while CurrentC, the m-payment initiative formerly backed by retail giants, seems to be floundering.
Research firm eMarketer predicts that close to one in five smartphone users will use mobile payments this year – but it says that growth will be driven by phone manufacturers preinstalling m-wallets on new phones.
The FordPass offering includes one of the primary use cases for payments via the car: parking. ParkWhiz and Parkopedia are available in the app marketplace. The Ford Guides can use the services to book and pay for parking on behalf of members, but members also can do it directly via the apps.
When drivers use ParkWhiz to book parking, the transaction is handled via FordPay. Ford will take a revenue share, according to Jens Weitzel, senior vice president of business development for ParkWhiz. The company does have direct relationships with parking facilities and, when users of its standalone app book parking, it handles the transaction.
So, FordPay represents a cut in revenue for ParkWhiz, but Weitzel says it's worth it. "For us it's additional distribution and awareness. They will market this to a very large [group]," he says.

But maybe the big deal about FordPay isn't payments.
Driving use cases
Automakers' mobile wallets are not about a cut of the transaction, according to Doug Brown, senior vice president and general manager of FIS Mobile. "It's more about client engagement -- a safe and easy-to-use feature integrated into … an immersive experience that includes applications and a wallet," Brown says.
FIS Mobile provides a white-label mobile wallet as well as a variety of other applications, mobile loyalty, mobile retail and mobile banking. That sounds a lot like FordPass, doesn't it? Brown would not say whether FIS powers FordPay, but he noted that his company has a partnership with SAP and its SAP Vehicles Network. Meanwhile, Ford has demonstrated SAP's processing of payments for fuel and parking in Ford cars.
What will make automotive wallets successful is integrating them into other apps that are useful to consumers, says Rachel Pasqua, practice lead, connected life and mobility, North America, MEC Global. "The role of technology is reducing friction in this increasingly frenetic world."
So, in effect, the wallet becomes a seamless part of other useful apps, rather than being a standalone app that drivers have to launch. FordPass users only have to authorize a payment method once, and it then becomes available for all the apps in its marketplace.
Cars for CRM
A mobile wallet will be still another important data source from connected cars. The wallet can both accept data and feed it back into the car's head unit or to the cloud. For example, Brown says, if onboard diagnostics were integrated with the wallet, it could provide information on how many miles per gallon the car had gotten.
Such integration also would allow them to personalize connected-car services in new ways, according to Tim Summers, global connected commerce lead for Accenture Mobile. For example, if the driver prefers Shell gasoline, and a connection with the car's systems shows there's only a quarter of a tank of gas left, the car's head unit notify the driver that there's a Shell station a couple of miles ahead. If the driver says yes to stopping there, the car would navigate there and initiate payment at the pump.

Shopping in the driverless car
FordPay – as well as FordPass in general – is a way for Ford to begin to reposition itself for a world, over the next five to 10 years, in which drivers don't always have to drive themselves. MEC Global's Pasqua says that when that happens, the automobile will become a prime content consumption environment.
"Think of my car as being a giant hardware cookie," she says. "I'll always be in that same environment when I consume that content."
Digital purchases may then become a much bigger opportunity than in-store purchases, she says. After all, there are only so many physical things drivers would want to pay for while in the car, the existing use cases of quick-stop snacks and fuel being the prime examples.
On the other hand, in an autonomous car, the driver can turn her mind to other things – shopping, books, videos or games. And the automaker's database in the cloud will allow it to log all those purchases and suggest even more things. Pasqua says, "The in-car experience will become ad inventory."
Summers agrees. In fact, Accenture envisions a world where marketers could engage in the same kind of real-time bidding for a driver's business that websites use today to sell targeted advertising. "You've opted into Shell and Mobile. Wouldn’t it be great if we could have them compete in real time for your business?"
Summers doesn't think the online advertising industry's ad exchange, couponing or loyalty platforms would be up to the challenge of real-time bidding in the car; Accenture aims to offer these to its clients, ideally as a service.
Many more car wallets to come
Ford is far from the only automaker exploring the integration of payments. Weitzel of ParkWhiz says his company is in talks with many automakers, as well as Tier 1 suppliers.
Last year, at Mobile World Congress, Accenture and Visa showed off a connected-car proof-of-concept, illustrating the scenario of a customer ordering food from Pizza Hut while driving. This year, its demo with Visa and Intel will focus on enabling use cases such as car sharing. This won't be just about payments, Summers says. For example, a car-share member's preferences could be included in the app so that preferences for things like the mirror position would be automatically transmitted along with the payment. Sharers might also have options for how they were charged, including miles driven, time spent with the car or even how safely they drove.
Says Summers, "It's telematics tied with commerce."