by Clint Boulton

Yamaha revs up digital strategy in race for new revenue

Aug 06, 2018
Digital TransformationIT LeadershipIT Strategy

Yamaha CIO Glenn Coles is banking on digital and mobile channels, augmented reality and customer data to bolster the recreational vehicle manufacturer's fortunes.

blazing speed leaving a glowing trail along a road
Credit: Thinkstock

Yamaha Motor Corp. USA is harnessing social media, customer data, augmented reality (AR) and information about its own vehicles to clear one of the biggest hurdles of the digital era: Creating a more direct path to consumers of its recreational vehicles, engines, robots and other machines. 

“We’re changing the focus of IT to support the new digital tier,” says Glenn Coles, who joined Yamaha as CIO of its North America division in 2006.

Creating and curating a digital relationship with consumers is a tall task for any company these days. Yamaha’s obstacles include figuring out how to get more consumers to its distribution network — the dealers who sell its motorcycles and motor boats, as well as personal watercraft, golf cars and ATVs.

These dealerships are the bridge to a customer base that ranges from tech-savvy millennials looking to glean information about the latest motocross bikes from their smartphones to tech-averse baby boomers looking to upgrade their fishing boat. “The way a millennial scooter buyer has a social presence is different from a retired baby boomer,” Coles says.

Building a digital bridge is key

But once consumers visit a dealer, Yamaha has no way of knowing what happens, let alone how consumers interact with its brands, unless and until they buy one of its machines or vehicles. To gather more information that could help get consumers into dealerships, Yamaha examines what customers are “talking about,” or browsing for, online.

Yamaha’s approach relies on an array of applications to “listen” to social media, ostensibly to understand what users are tweeting on Twitter or saying about the brand and its products on Facebook, or monitoring activity on enthusiast websites to see what people are interested in, which helps them identify new prospects for sales. Maybe Yamaha identifies an existing customer who is asking around online about upgrading to a larger boat, or who is in the market for a new engine.

It’s a departure from and a complement to Yamaha’s analog tactics, which include inviting users to demonstration events. For example, Yamaha maintains a strong presence at fishing events where its boats are used, which helps them meet with existing and potential customers. Such showcases are prime opportunities to identify new business.

But Yamaha must strengthen its digital connections, either through its website or mobile channels, Coles says. If users opt in to receive information from digital channels, Yamaha can email or message them offers, service-warranty information for purchases and other information. Coles says building out a digital direct-to-consumer strategy is part of the “customer journey map” Yamaha is emphasizing to strengthen brand ties. “We talk a lot about digital convergence,” Coles says. “It’s a journey that we’ve been taking and trying to grow for a number of years.”

The key to strengthening the customer relationship is, of course, actionable data. Coles has used Oracle software to aggregate, cleanse and store troves of customer information, including past purchases, preferences, and other data points. His team mines this software for insights about how to upsell customers or target them when they may be due for a new engine or vehicle. “Having that unique, clear understanding of who that customer is helps us drive engagement,” Coles says. That engagement will eventually include chatbots to assist its call center support workers, Coles says.

Coles is also navigating a world that is increasingly turning toward autonomous driving and other automated functions. Although self-driving cars and trucks are rapidly changing the motor vehicle industry, the pleasure for riders of motorcycles, snowmobiles and other recreational vehicles lies in the driving.

Coles should know; he was a professional motocross racer and boat enthusiast before hanging up his bike helmet for a career in IT. “I am a racer turned CIO,” he says. Still, Coles acknowledges that as autonomous driving evolves, Yamaha will need to come along for the ride.

Driving to a connected, augmented user experience

Exactly how it will do this remains to be seen, but the company is building connected vehicles, pairing WiFi, sensors and mobile software to collect information about its vehicles. Its YZ450F dirt bike, for instance, features a Power Tuner application riders download to their iOS or Android smartphones.

The app uses 3D mapping technology to help riders tune the performance of the bike, including fuel injection and ignition timing, based on track conditions. It also includes a real-time log, race log feature and maintenance record. As Yamaha adds more internet connections and sensors to its products, it will be able to help anticipate and head off potential performance issues.

Digitization has also made its way into service repairs and maintenance. Yamaha is testing augmented reality (AR) glasses and software to scan the status of its motorcycles. When a user wearing AR glasses views the bike’s vehicle identification number, a digital overlay appears in the lens, identifying and providing the real-time status of its components.

Such diagnostic could inform a service technician or even technical hobbyist that, for example, the clutch needs to be replaced, Coles says. Then the wearer can view video instructions through the glasses to learn how to swap out the bad part with a new one and reassemble the bike. No experience required.

“It takes a lower-level technician and turns them into a master technician,” Coles says. “And that changes the ownership maintenance experience.”

In the near future, Coles imagines a world where a pairing of sensors and machine learning software enables a bike to self-report a clutch in danger of breaking to an owner, perhaps from a message through a mobile app, whereupon the owner can buy the part and replace it himself. Such digital convergence — combining the analog and digital world — is the new operating model, Coles says.

“The mix of products is evolving and changing so that although baby boomers retain huge buying power there is a younger consumer segment that expects to use digital technology,” Coles says. “It is a different type of value proposition.”