How eCommerce Is Solving Automotive Industry Sales Challenges
Automotive Industry and aftermarket parts sales challenges are monstrous, Learn how eCommerce is quickly becoming the solution that automotive parts retailers have always needed.
What if you could become part of a $7.4 billion dollar industry tomorrow?
That number represents sales in the automotive aftermarket industry in 2016. The amount shows how eCommerce is changing the face of the automotive market.In fact, there are over 70 million auto part searches every month (Google) Click To Tweet
If you’re in the automotive parts industry, Embracing eCommerce is going to be one of your best avenues for overcoming industry challenges.
What Are The Automotive Industry & Aftermarket Parts Challenges?
The traditional automotive industry has faced several challenges. These include difficulty in marketing and difficulty in order processing. There are also problems receiving payments and shipping items.
This combined with
Using eCommerce allows you to solve these problems in creative ways. It also provides unique opportunities that your business would otherwise miss.
1. Easy Information Exchange
Cars are complex machines. There are many different parts and variations for vendors to keep track of. This makes it likelier for processing errors to occur.
Just think of the typical product catalog for any automotive parts store… we’re talking tens of thousands or even hundreds of thousands of skus! The automotive parts order process takes up a lot of time and effort in simply finding the part your customer is looking for.
Using eCommerce lets you unify your inventory within a single system. This is very important in the automotive industry. Building your online store around this system allows you to automate much of the buying and selling process. Not only does this help with internal cataloging, but eCommerce puts the power in your customers’ hands, allowing them to quickly find the exact part they’re searching for using your online product search functionality based on the make, model and year of the vehicle, rather than the article number just like the image shown below.
Such a system makes information available in real-time. For vendors, you can immediately keep track of inventory changes. For buyers, it is easy to print invoices and track shipments.
My favorite shipping integration hands down is ShipWorks. Any online retailer will tell you that shipping is one of the most critical issues to get right, and if you’re selling heavy auto parts, I’m sure you know what they mean.
With ShipWorks, you can drastically reduce the amount of time spent on order fulfillment. From the moment you begin using ShipWorks, you will notice an easy-to-use interface that reduces order management to point and click, allowing you and your employees to start taking advantage of the software right away. Every element of ShipWorks has been designed with an emphasis on time savings and usability, which ultimately translates into reduced costs for your business.
Using an integrated system like this also makes it easier for buyers to search your store. By making the system easier to use, you encourage buyers to return to your store. It also encourages them to buy more items any time they visit your store.
According to one Forrester research analyst, product recommendations like upsells and cross-sells are responsible for an average of 10-30% of ecommerce revenues.
2. Easier Marketing
A) Motivating the Sale on Site
The main difficulty in marketing automotive parts is customers do not always know what they need. This is one of the automotive industry challenges that eCommerce can very easily solve.
Part of what makes sites like Amazon successful is that they recommend related products. As soon as they click on an item, the system recommends other items they may want to buy. It’s NOT just the related items that makes Amazon product pages so appealing – it’s the fact that they give the shopper EVERY piece of information they could need in order to make the decision to buy.
Your own eCommerce system can do the same thing. If you have a customer searching for diesel up-pipes, your system might offer them complete up-pipe kits first with optional parts that they may also need such as; an up-pipe collector bolt and nut. Such a system can also help upsell to customers trying to buy the cheapest parts.
Convincing someone to purchase a product or service isn’t always an easy task, get my guide on How to Create a High Converting Sales Page Here.
B) Driving Customers to Your Automotive Parts Site
When it comes to online marketing for the automotive industry, the second and most critical piece is cost effective methods to reaching your customers. Once you have a landing page that is set up to convert your visitors, you need an effective traffic funnel to drive them their!
According to Auto Care Association’s E-tailing in the Automotive Aftermarket study, 63% of replacement parts buyers and 51% of upgrade buyers, consumers install parts themselves.
The main benefit of having an eCommerce platform to drive your automotive sales is the availability and flexibility of access to many powerful sales channels. Regardless of the industry, it always pays to have a solid strategy when initiating online marketing.
For example; we all know Amazon to be a powerhouse for online sales and this includes automotive parts; however in the automotive industry massive competition and price driven sales can often work against auto part resellers. Brand owners and white labelers on the other hand tend to generate a huge return on Amazon because they have access to a giant highly motivated audience while controlling their brand and pricing.
While it’s not impossible for long established auto parts resellers to find success on Amazon, other avenues can be more lucrative in terms of ROI.
RiffRaff Diesel is a great example of a niche auto parts retailer who is growing their brand and sales online through Adwords. Many people shy away from Adwords from fear of wasted ad spend. One thing you have to realize is that to get your auto parts in front of the right people on ANY sales channel there is a marketing cost. Amazon takes their 20+% depending on product and category where Google Adwords charges are usually a cost per click.Either way it doesn't matter what the investment is as long as the return is profitable. Click To Tweet
We’ve been able to increase revenue by online sales over 120% each year for RiffRaff using Adwords Search and Shopping. What is that in terms of sales and dollars?
• That’s $1.5 million YTD in direct retail sales (not counting landed lead sales from calls).
• That’s 5,686 direct online sales
• 631 Phone Calls
While I can’t discuss margins, from an $80k ad spend this is a MASSIVE return on investment!
All this to be said, the main goal for your automotive eCommerce store should be to sell everywhere, and manage from a single location.
This ability is referred to as omni-channel retailing. The right ecommerce site will have a seamless approach to omni-channel retailing by integrating with key tools and serving as the hub for all your channels and eliminating many of the core road blocks I mentioned at the start of this article. The core of these channels includes:
A) Your Online store
Build a modern online store with a responsive design that looks and performs beautifully on desktops, laptops and mobile devices.
B) Physical store
Connect your online store with your physical store using a POS to have your inventory automatically updated whenever you make a sale, online or in person.
C) Online marketplaces
Get your products in front of millions of shoppers by listing on high-traffic marketplaces like eBay and Amazon.
D) Social media
Shoppers can discover and buy your products on some of the world’s most popular social media platforms, including Facebook and Pinterest.
E) Email & Customer Focused Communication
Integrating your (or an) email marketing system will allow you keep a personal touch while removing manual tasks from your to-do list. Pre-built marketing automation creates room to focus on strategy allowing you to welcome, re-engage, and follow up with the people who matter to you.
3. Easier Payments And Shipping
The sheer number of automotive parts to keep track of can lead to shipping errors. And the more a customer orders, the likelier it is for something to go wrong.
Customers and businesses often have custom orders. This adds an extra layer of complexity for your business. Making mistakes on large customer orders may result in you losing out on their future business.
Running an ecommerce auto parts store involves tracking a LOT of moving parts. Handling all of these parts separately is inefficient and ineffective, ultimately causing irreparable issues that will certainly hurt the customer experience and your bottom line.
Conversely, using an integrated ecommerce platform, like BigCommerce will eliminate the need to juggle multiple management systems, plus it will allow your automotive business to synchronizes and streamline the front end user experience with your back admin management experience. This will make it far easier to keep track of shipping requirements and custom order requests.
Your integrated website can also give customers additional flexibility by allowing them to input multiple shipping addresses and different payment options.
Shipping automotive parts is notoriously tricky due to product sizes and weights. As a general rule, Free Shipping is the Golden Rule of eCommerce selling. Unfortunately, free shipping doesn’t work for many eCommerce auto parts retailers due to high shipping costs and low margins.
What can you do to make shipping work for you?
- Focus on Customer Service – Ship Fast! Fast shipping makes it easier for consumers to buy online – that’s why it’s so important.
- Shipping Incentives – Offer Free shipping to customers once they have hit a certain dollar amount on their order.
- Create Shipping Rules – exclude specific products for free or discounted shipping.
- Make it Transparent – make it easy and visible for customers to calculate shipping prior to ordering.
Eliminating checkout barriers and giving customers greater control of the ordering process online increases their satisfaction. It also makes orders more accurate and easier to process for you.
The Best Shipping Integration You’ve Never Heard Of
I’ve saved the BEST tip for last when it comes to shipping parts for your automotive store, and I really think you’re going to love this!
Tracking and shipping information is instantly shared with ReadyCloud CRM. So whether you are sales, support or running the asylum, you know how well you are serving your customers with visible shipping, package tracking and customer profile updates.
Here is the BEST part – Shipping Discounts
This is hands down one of the best integrations any eCommerce auto parts store could have is this. The more you ship, the more you save.
The Future Is Online for the Automotive Industry
Some automotive parts retailers are hesitant to have an online presence. Setting up an eCommerce website seems like a lot of extra work. Furthermore, eCommerce software can seem intimidating and complex.
However, brick and mortar automotive sales have been stagnant over the past few years. One research study from Hedges and Company found such sales only grew by one percent between 2014 and 2015.
Meanwhile, the same study projects automotive eCommerce sales to increase by 12% to 16% between 2015 and 2019. Relative to your potential profit, the cost of setting up eCommerce is very small.
Many aftermarket parts retailers have been the first to see and embrace the power and reach that eCommerce can provide. In fact, Hedges and Company recently published a more recent report that the “annual forecast for online car parts sales projects retail sales at $8.89 billion in 2017, posting a 16% increase over 2016.”
Ecommerce auto parts sales outpacing brick & mortar, will reach $8.9B excluding auctions and used parts
Your automotive business has nothing to lose with eCommerce. You can still sell through your brick-and-mortar store as you always have. This just gives you the opportunity to sell through multiple channels.
An integrated website is the foundation of your eCommerce success. With it, you can then market through channels such as social media. This allows you to reach multiple markets at very little cost.
Merging Online And Offline
Many customers now expect a seamless transition between online and offline experiences. One example is Wal-Mart, which uses an app to let customers browse individual store items.
This approach works well with the automotive industry. Apps for eCommerce or integrated web stores allow customers to plan their purchase before they arrive.
This may be as simple as the customer selecting and paying for parts before picking them up at the store. It may also allow the customer to tell the vendor about their needs before arriving at the store.
Ultimately, the idea is to create a seamless online and offline shopping experience. This provides customers what they want while boosting your bottom line.
The Need For Transparency in the Automotive Industry
Customers often feel frustrated when shopping for automotive parts. This frustration comes from not knowing much about the automotive industry.
Those same customers are afraid that they are going to get ripped off. They feel that the auto dealers and parts retailers have all the power and they have none.
Edmunds has found that 54 percent of consumers surveyed claim that getting an actual price and payment is their largest unmet online need.
This is one of the automotive industry challenges that eCommerce easily solves. You can use your website or an app to allow customers to create a parts deal that best suits their needs.
For example; you can make complicated product options easy for your customer by providing kits and bundling options or even custom product attributes. Keeping your database flexible and offering product variations on the front end that accommodation custom ‘fit my car’ tools to easily walk your customer through complete ‘kit’ options that sync up with the make, model, and year of their vehicle is going to give your automotive eCommerce store a definitive edge.
A simple change like this that dynamically updates pricing options makes customers feel they have more power and control. They now see themselves on equal footing with the dealer. This establishes your brand and builds intense loyalty among your customers.
There are several different Ecommerce platforms that you can build your auto parts site on. Use my Ultimate Ecommerce Start Up Guide for help determining which platform will be right for your automotive business.