By Ioana Mazare, Automotive Marketing Manager, UPS
By now you know the stats. The average age of automobiles will climb beyond its current record of 11.4 years. Automotive aftermarket e-tail revenue is projected to double within three years. There is significant revenue potential for your business. But your web presence will need more than a quick tune-up to capture your share of incremental sales.
Who is shopping online and what are they looking for? Let’s take a look at the dynamics around DIY (do-it-yourself) vs. DIFM (do-it-for-me) consumers and the differences in their purchase trends.
According to the Auto Care Association’s E-tailing in the Automotive Aftermarket study, which surveyed both technicians and end consumers, 16 percent of replacement parts purchased within the last six months were installed by customers. This varies greatly from the results found in UPS’s What’s Driving the Automotive Parts Online Shopper study by comScore, which focused solely on the end-consumer. This study found that significantly more, 63% of replacement parts buyers and 51% of upgrade buyers, consumers install parts themselves.
An interesting pattern seems to be emerging. Online auto parts shoppers, while currently a relatively small portion of overall auto parts sales at 6 percent of total industry sales, appear to more likely be DIYers.
Balancing inventory levels
The Auto Care Association’s e-tailing study provides another piece of the puzzle to optimizing your online sales channel. A look at the parts DIYers are buying online reveals the majority of purchases are simple parts such as filters, glass and lighting products, and electrical parts that are generally less technical and easier to install. Larger and more complex parts that range from computers and emissions components to exhaust systems tend to be DIFM purchases.
The product mix that DIFM customers buy is also much broader compared to what DIY consumers typically purchase. Steering and suspension systems, collision and body, temperature control, and transmission and clutch components are more frequently purchased by DIFM consumers. Because these products are typically larger and heavier than the simple parts DIYers tend to buy, shipping options and a returns management program are critical. These more complicated parts also may need expedited delivery to quickly get the vehicle back into service. The height/weight dynamic and potential need for faster delivery will impact shipping costs. Offer your customers multiple shipping options that balance urgency and price.
DIFM customers are more likely to be Millennials (aged 18 to 34) and, according to the UPS study, are more likely to be upgrade buyers. These customers are more tech-savvy than replacement customers who use social media to research before they buy, more likely to share their experience on social media, and more likely to make purchases with smart phones and tablets. Strengthen your online marketing, social media and website properties to provide a seamless and gratifying customer experience.
Now that we have a sense of which types of customers are purchasing which parts, let’s look at how those purchases are being made.
Planning purchase cycles
According to the Auto Care study, DIY customers are more than 5 times as likely as DIFM customers (11 percent to 2 percent, respectively) to perform their own maintenance or have maintenance performed on their vehicle at least once a month. Simple-to-install parts will therefore likely be your top-sellers and should have prime placement on your website and apps for smart phones and tablets.
According to the Auto Care study, nearly 70 percent of DIFM consumers report having maintenance done to their vehicle every two-to-six months. If your more complex products aren’t selling as quickly, don’t panic. They may simply have a longer turn rate. Adjust your inventory levels accordingly. Explore warehouse solutions that keep SKUs that sell well in certain regions or times of year well stocked for quick delivery and lower zone shipping, both of which help ensure brand loyalty.
Maximize sales among high turnover items and create loyalty with those customers so you’re top-of-mind when the time comes for a larger purchase. Combine the data from your inventory management tools, channel management and online marketplace management tools to help forecast the quantity of each SKU that should be ready for sale online and in-store throughout the year.
In today’s competitive marketplace, consumers are rewarding businesses that provide an exceptional online experience with repeat business and by promoting them to like-minded customers on social media. Whether it’s a DIY or DIFM customer, digital analytics and flexible shipping solutions will help you develop a road map that guides each type of customer back to you each time they make a purchase.
Ioana Mazare is the Automotive Marketing Manager at UPS, where she works with automotive OEM and aftermarket manufacturers, distributors and retailers.