Rob, give us an overview of the current fleet telematics market.
The fleet telematics market is maturing. You have a large number of companies that now “get” that it is not an option. You have to have GPS tracking on your vehicles. The technology has really evolved, the costs have come down, and I think right now companies, large companies in particular, are starting to understand that it is not about absolute cost, it is about the opportunity cost of making sure that they go with a product that will suit their costly business challenges.
A number of analysts will tell you that 20 to 30 percent of fleets have GPS tracking. I have to say that a lot of those companies are early adopters and may be unhappy with their existing provider. I would estimate that 85 percent of the trucks fleets are still looking for a good provider.
What fleet managers really need to look for is not just dots on a map, but a partner that will help with the customization of the product for their exact business challenges and the integration into their systems. The larger companies really need integration and if you go with a low-cost partner that might not have the experience in doing those integrations, you really are giving up quite a bit of potential return on investment.
You just mentioned trucks, what about cars?
Car fleets tend to be more sales focused and that is sort of the last place where companies are starting to think about tracking. They don’t like to track their salespeople. These companies are concerned they will upset their salespeople, but we have a number of clients that track their salespeople in a way to make them more efficient by integrating their customer relationship management tools.
They can give their sales team reports that show them where they haven’t been in their territories yet. They can compare their route to, let’s say, places that have had new construction permits and they use technology to help and enable the sales folks.
For the most part, we tend, and the industry really tends to gear itself towards service trucks and local delivery trucks, and at the other end of the spectrum you have the long haul guys.
How does GPS Insight tailor your product for large fleets?
Our product is really geared toward large fleets. It works well for small fleets but the large fleets we identified with early on. If we didn’t make it really simple to administer all of the aspects for large fleets those users wouldn’t actually use it to its full potential. We make it very simple to import user lists and distribution lists to insure that setting up reports for hundreds of users across thousands of vehicles in a fleet is just as easy as setting up one alert or one report.
Many other products will require the end user to set up hundreds of users, hundreds of reports, hundreds of alerts – one per group. We have used a hierarchy to really automate the vast majority of that so that it is no more difficult to administrate a multi-thousand unit fleet than it is just a handful of vehicles.
We are always adding new capabilities to the product, which is one of the things about GPS Insight that sets us apart.
Besides the typical new reports and new alerts and enhancements to the dashboard, in April we announced our support for a new device which came out from Garmin, called the Garmin Fleet 590 device. It is actually a plug and play GPS tracking device and a navigation device. In other words, you can buy a Garmin now from GPS Insight, put it on your driver’s dashboard, plug it into the cigarette lighter and you are tracking that vehicle. So, there is no install, no difficulty in terms of getting up and running – not only with GPS tracking, but with dispatch, messaging, and acceleration/deceleration detection.
Does it also detect hard turns, hard breaking?
It does, absolutely; it has an accelerometer in it which we determined is very accurate and that is very exciting because a lot of fleets really care not only about the efficiency aspects but certainly the safety aspects of how their drivers are treating their vehicles.
Garmin has done a great job patenting an intelligent cigarette lighter adapter that is able to determine engine status. So, even though you are not wired into the engine or the bus and doing a hard install, it is able to very accurately determine when the engine is running, when it is idling, how fast it is going, and it gives 15 second updates. The Fleet 590 is a fantastic device that we are really excited to bring on the market.
Does it have a traffic feature?
Yes, you can actually purchase an online traffic subscription package. I truly don’t know the details, you get that from Garmin, but it will help route you around traffic just like all of the other Garmins will.
Does this device talk to the j-bus?
This particular device does not. In addition to the new Garmin Fleet 590 device, we are enabling all of our devices to talk to the engine’s j-bus whether it is heavy duty or light duty OBDII. We are now in a position to get diagnostics for just about every make and model of vehicle and just about just every device that GPS Insight sells and supports.
There is nowhere to hide anymore.
It is a fact of life. It is no different really than putting security cameras all over the place. We see how useful they can be in just the recent Boston bombings. If it weren’t for those security cameras we wouldn’t have caught the bombers. We have the same situation with GPS tracking. A lot of times it is your driver’s friend. It can exonerate somebody who has been in an accident, of somebody saying they were somewhere they weren’t, or speeding, or using a vehicle for different purposes other than for work.
Additionally it just helps the company. The return on investment for a typical GPS tracking solution is anywhere from 200 percent to 1000 percent. That money flows to the company’s bottom line, helps them to grow, helps them to insure that driver’s job and, frankly, just helps not only the company but the overall economy.
We are starting to really see the widespread adoption in a way that companies understand that it is not about finding the cheapest product on the market; it is about finding the product that delivers the most value and return on investment. I always like to say it is not about cost, it is about opportunity cost. We continue to do what we can to help our customers save money on fuel, labor, you name it.
What portion of the market would you say would be unhappy if they had to replace the hardware?
Originally, the idea behind GPS Insight was to be completely hardware agnostic. That is a great theory. In reality, the hardware costs have come down to the point where in some cases it is almost more expensive to do the install than it is the hardware. That is not the biggest piece of the puzzle for most fleets these days. You can stomach replacing some legacy hardware that didn’t work the first time for your application with new next generation hardware.
That also brings up the fact that there will be hundreds of thousands of devices that stop working over the next few years because AT&T is turning off their 2G network. That means the vast majority of devices out there right now are not going to work coming up on 2016 so they are going to have to get replaced anyway.
BIO
Prior to founding GPS Insight in 2004, Robert ran a successful consulting business, worked for various hedge funds and dot com’s, and served as an Army Artillery officer. He has advanced degrees in Finance and Computer Science. Robert lives in Scottsdale, AZ with his wife and 3 children 8-13 years old.