It’s the fastest-growing retail sector in the auto care industry and becoming a significant revenue stream in auto parts sales. It’s etailing. Etailing now accounts for $6 billion in automotive aftermarket parts sales in the United States, according to the Auto Care Association.
And, by 2018, it’s expected to double in volume. For the purpose of avoiding confusion, let’s talk about what etailing is not: Etailing is not the type of ecommerce that utilizes closed electronic ordering systems, as the Automotive Aftermarket Suppliers Association (AASA) points out in its report, “Digital Disruption: e-Tailing in the Automotive Aftermarket.”
Etailing is selling through publicly accessible websites to professional technicians and consumers/DIYers – the emphasis on “publicly.” Automotive technician customers (DIFM) already make more online parts purchases than consumers/DIYers, so it’s imperative to continue to bolster the underlying technology. Product content, which includes technical info, photography and descriptions, as well as shipping options, will give your business a leg up. Yes, there are some potential sensitivities with etailing, chiefly among them price transparency. More than ever, pricing is apparent because it can be gotten from so many places.
The markups expected through the traditional distribution channel may have to be pared back in order to get the sale, because the distribution structure in place that necessitated building in costs is no longer there. For example, etailing inventory is normally held in low-cost warehousing, whereas holding retail inventory costs more because of the relatively higher costs of a bricks and mortar retail location.
This results in a savings on parts sold by etailing, resulting in lower prices and a more competitive offering. According to AASA, more than 50 percent of consumer auto parts buyers begin their purchase online. Booz & Co. (now doing business as Strategy&), which authored an etailing study with AASA, estimates that will grow to 90 percent in five years. How can aftermarket distribution capitalize on this trend?
By providing the latest, best information, which is what buyers, whether DIY or DIFM, depend on. Highly detailed product descriptions with excellent photography go a long way to ensuring the customer is receiving the correct part and reduces comebacks. In addition, the more shipping options, the better. A calculator that gives accurate costs as the customer is carried through the buying process helps build confidence and broadcasts to buyers that your business is transparent. Help your customers know when they’ll receive their shipment via package tracking and visibility. Lastly, offer in-store pickup at a brick-and-mortar location as well as a competitive returns policy to bolster your customers’ confidence in buying from you.