Self-driving cars will seriously disrupt advertising — here’s how

The self-driving car is on a roll. Some estimate that in just four years, there will be 10 million self-driving cars on the road, and at Ford, word is self-driving cars are just five years away from changing the world. Apple and Google’s parent company, Alphabet, are both reportedly eyeing real estate buys that would house their self-driving car operations. Meanwhile Uber is testing self-driving cars, and some think that self-driving cars will first hit the cars-for-hire market.

Although it might be more like 20 years before self-driving cars are the new normal, it’s important to let it sink in now that Google — the company with arguably the biggest head start in the race to put these cars on the road —  didn’t spend years investing billions in developing self-driving technology for the fun of it; it did so because it’s fundamentally an advertising company. Its leadership clearly understood that if a company could free people from driving, it would have access to more of consumers’ time to look at content and even ads. The average commute among Americans is a total of 50 minutes per day, so that likely means a significant boost to Google’s bottom line, and to the rest of the mobile ad industry.

Here are a few ways the rise of self-driving technology will affect the advertising industry overall, whether that’s in five years or 20:

Billboards will get smart or die

Once self-driving cars are ubiquitous and people are no longer paying attention to the road or billboards, billboards will need to evolve to not just send a message but also collect data that can be used in meaningful ways. Even now, we’re seeing some interesting things happen here: In Australia, billboards from Lexus send directly targeted messages to drivers of luxury model cars. As assemblers of data, smart billboards have a lot of potential. Outdoor advertising companies are beginning to pivot accordingly. Clear Channel is experimenting with collecting data on people who pass their smart billboards. Right now, it passes that data along to make more targeted billboard campaigns and to help determine return on ad spend by running the numbers against purchases and brand awareness. But over time, that data could have other uses. “Dumb” billboards will have to get smart or die.

Last gasps for the radio industry

Obviously, streaming apps like Spotify, Pandora, and Apple Music have hit the radio industry hard, not to mention Sirius XM’s attack from above. Some estimate that 60 percent of cars shipped in 2018 will be connected, which in and of itself will be a major hit. But the proliferation of self-driving cars could be radio’s death knell.

Imagine being able to not just listen to whatever you want but watch whatever you want, on your way to work or on a road trip. “If music streaming apps weren’t bad enough, stealing away all those listeners, drivers will soon be able to devote their time and attention to any number of diversions,” writes Adweek. Binge-watching on the road — likely even via built-in connected devices rather than mobile devices — will finally be an option for everyone in the car, not just the kids in the back seat. I don’t know about you, but given the choice between sitting in traffic watching Silicon Valley or listening to my local shock jocks, I’d take keeping up with Pied Piper’s valuation any day.

Mobile apps will become more popular than ever

We’ve seen it everywhere: When consumers have bits of free time, they love to play games on their mobile devices. Sure, some folks dutifully peck away at emails to get a jump on the workday, but mostly, they’re crushing candy or clashing with a warring clan. And, naturally, more time spent on games, or really on all sorts of apps for that matter, means more opportunity for advertising, not to mention more money and attention for mobile publishers and developers as well. On top of this, mobile revenue already peaks during commute hours thanks to WiFi-connected transit and on-demand ride apps like Uber, suggesting that a bonanza awaits whoever can unlock the potential of those currently behind the wheel of a car.

So although the biggest and most obvious impact of self-driving cars will be convenience and potentially safer roads, their prevalence will still have a ripple effect and impact other industries. For advertising, they’ll snatch consumer attention away from some traditional forms of advertising and potentially further fuel the mobile app marketing and development industries. In 10 years or less, we could well look back on self-driving cars as the beginning of the end for outdoor advertising, the nail in the coffin of radio, and a shot in the arm to mobile apps.

Adam Foroughi is cofounder and CEO of AppLovin, a platform that provides marketing automation and analytics for mobile and Apple TV apps.