We are watching electric vehicles (EVs) enter the mainstream. And there’s money to be made from helping drivers charge their EVs whenever, wherever they want. But IT often stands in the way of scaling the EV charging business. So how do you get the IT strategy right, place your investment bets and decide what to build versus buy? Here are some reflections on the road ahead.
EVs are beyond the tipping point
EVs are truly hitting the mainstream—with established brands now moving into EV territory (not just the “showcase” brands). With the uptick in consumer purchasing comes the need for EV charging. And that means serious business—with money to be made around charging services, on the road, as well as at home. In our latest New Energy Consumer Research we project the business case for these eMobility services to reach €5 billion EBITDA (about $5.9 billion) in 2030 for key European countries alone.
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So, in this landscape of commercial opportunity, how do you position yourself as the charging provider of choice, and what does this mean for technology to grow your business? How do you move the EV business from start-up/bolt-on/sideline to something you can scale and optimize for the future?
IT is frequently the bottleneck
My clients are increasingly finding that when it comes to the EV charging business, IT is their bottleneck to growth. Why? Here are a few examples I’m seeing.
Scenario 1: you’ve entered the EV market and now you want to grow. Problem: your current IT cannot scale effectively for increased volume.
Scenario 2: you entered the EV market with a technology partner that helped you get established in the market. Now you want to launch new offerings using IT and devices you engineer yourself of buy from other partners. Problem: you’re restricted by your current vendor’s capabilities (a “vendor lock-in” situation) and your growth objectives are curtailed.
Scenario 3: you’ve acquired multiple companies to accelerate your progress in the EV market. Problem: each one has its own IT strategy, solution and budget (and by the way, each of them is very convinced their technology is the best). But this all adds up to unwieldy complexity, cost and rigidity.
These challenges are not exaggerated. Consider the real-world example of a utility billing EV charging customers manually (because their current EV charging system does not have a billing component and isn’t integrate with their existing billing system for electricity retail yet). That means downloading reports, calculating bills in spreadsheets and mailing out accounts. If you have 1,000 customers, it’s probably doable. But you can’t grow your customer base and capitalize on the scale of the opportunity.
Look to IT to industrialise your EV business
These two elements create a nice paradox: You need to invest in IT to be able to grow your EV charging business and you need to do it now to capture the hypergrowth in the market. But at the same time, the technology investment budget earmarked for EV is still small. (It is in line with the current market size, not the likely size in five years).
In this context, how does the IT manager decide where to invest that limited budget? The answer: choose your bets carefully. Don’t blindly assume continuing to build your entire solution in-house is the way to go. You may find yourself re-inventing the wheel. However, relying 100% on out of the box software won’t make your EV charging offerings stand out in the market. I counsel my clients to buy technology out of the box where possible, and only build where the component in question will make you unique in an important way.
Here’s an example, the system to manage your EV chargers does not make you unique. Its most important quality? Be reliable. For customers to get a good charging service that works, where and when they need it, EV charging providers must have good real time insights in the current state of their chargers. So, look for a system that helps you to get you data quality up and you will be able to strive for operational excellence in managing the chargers while increasing customer satisfaction at the same time. For that purpose, think about buying a platform that meets your needs, has the functionality you are looking for out of the box and is designed for easy integration with other systems. Customize this platform only where essential. By picking the right platform, most of my customers even manage to not customize their platform at all.
Now think about the other end of the spectrum. How do you want to interact with your customers? What makes you stand out with your clients (drivers, fleet managers, resellers)? The customer app/system is the place for uniqueness, to define the customer experience, showcase your selling points, represent the brand and the offering. This is where you could build or tailor heavily to your requirements.
Ultimately, it comes down to defining your roadmap for the future. Where do you want to be in two to five years, and how can your IT support those ambitions? Use the budget you have now, to put the IT foundations and architecture in place that are necessary to grow. Create an investment roadmap that will help you to capture your slice of the EV charging market over time, adding new components and features when relevant. Plan and position yourself for success as the opportunity continues to grow.
It’s time to put IT at the top of the list for expanding your EV charging business. Contact me to find out more about how.