The Focus & Future of the Automotive Aftermarket
We’re all used to self-service on the web, whether it’s managing our own finances or booking a flight or a holiday. Why can’t it be the same for car parts?
According to the SEMA 2022 Future Trends report, electric vehicles, connected cars, and eCommerce, among other trends, may lead to the redistribution of 30 to 40 percent of aftermarket profits along the value chain and change the industry landscape in the next 10 to 20 years.
With an increase in demand for aftermarket parts, many retailers are taking a hard look at their ability to meet the demand and provide the experience their customers are craving – convenience, extensive product selection, consistent availability, and fast delivery. To meet this demand, many retailers have a web store in place, but it’s commonplace that those sites were built years ago and may not have been set up to handle the increased inventory options and transaction volume that the current eCommerce environment demands. If you are not offering a seamless experience from browse to search to purchase, you risk being left behind. Now is the time for you and your team to face the facts: What are we doing to provide a better eCommerce experience?
In this blog post, we will discuss some of the key factors that are contributing to aftermarket parts success and how you and your team can be strategic in maintaining a competitive position in a rapidly-changing environment.
Key Factors Contributing to Aftermarket Parts Success
Dramatic changes are in motion within the automotive aftermarket. These include changing customer expectations, accelerated adoption of new technologies, and shifts in competitive power.
Automotive aftermarket eCommerce retailers are seeing growth on just about every front. Why? There are not enough new vehicles to meet consumer demand, according to SEMA. Not surprisingly, this means more and more people are keeping their vehicles and spending more of their money maintaining them.
But that’s not all bad news, as this provides retailers the opportunity to increase their bottom line and take advantage of this aftermarket acceleration. Let’s explore some of the key factors contributing to this rise in reliance on aftermarket parts and services.
- Low auto inventory levels: New-vehicle inventory at the end of July was higher than it was a year ago, when the global computer chip shortage began hurting production, but supply remains low compared with pre-pandemic times, according to Cox Automotive’s analysis of Auto Available Inventory data. In addition, domestic production of new motor vehicles in the United States was down 16.5% from 2019 according to SEMA. Vehicle sales over the same period were down 9.6%, which has led to historically low inventory. People have reported waiting on an average of six or more months to receive their new vehicle. Low inventory levels likely mean demand for new vehicles will remain strong over the next year, as auto manufacturers work to repair supply chains and produce more vehicles.
- The rise in technological advancements: Aftermarket parts such as catalytic converters and electronic chips are in high demand as owners invest in their older vehicles trying to make them more fuel-efficient and environmentally friendly. In addition, people are always on the lookout for new features to add to their older vehicles.
- Government regulations: Stricter car emission regulations have put pressure on manufacturers to produce more environmentally friendly and high-efficiency parts. This demand is expected to excel at a fast pace in the future and is a trend to stay on top of.
- More disposable income: More people are self-made millionaires, demanding more luxuries, including wanting to design or remodel their vehicles, which is increasing the demand for aftermarket products.
Overall, aftermarket retailers should feel optimistic about the future. The strong demand for aftermarket products will continue to grow in 2022 and beyond. However, challenges loom on the horizon. Ongoing supply issues will likely constrain available supply and increase prices.
What’s next for your business and retailers alike?
Many retailers are taking a hard look at their ability to provide a better online buying experience for their customers and asking themselves some tough questions such as:
- Are we prepared to handle increased online sales?
- Can our current technology help us stay on top of the supply chain issues?
- Is our existing store technology a problem?
This hasn’t stopped consumers from making a purchase. Shoppers simply switched brands or went to another retailer to get what they needed. What does this mean for you? Don’t let technology get in the way of your business and profits.
Side Note: According to the SEMA report, nearly ⅔’s of people reported they wanted to purchase something from an online auto aftermarket retailer, but it was out of stock.
Let’s take a look at how you can get ahead of issues like this with eCommerce:
- Extend your geographical reach: Whether you sell parts B2C, B2B, or both, eCommerce extends your geographical reach and provides your customers with 24×7 access to place orders. Fully integrating third-party codes where customers can view their complete purchase history and status of current orders from anywhere, anytime is just the beginning of building your customer base beyond your brick and mortar.
- Improve customer experience: Elevate the buying experience by allowing customers to manage parts and pricing while having immediate access to inventory.
Get professional help updating your eCommerce site: InteractOne offers full-service website custom design and deployment, using Magento. Take a look at how we helped turn a static automotive aftermarket site into a responsive, custom-designed one and how we can do the same for you.
Bringing it all Together
With the accelerating growth of eCommerce – which creates opportunities to modify business models and adopt new ways of interacting with customers – automotive suppliers and distributors face increased pressure to transform now. How come? Retail giants are quick to fill gaps and expand their footprint into new industries like automotive. But the one thing the big retailers can’t match is the automotive experience and expertise of companies that are already established and successful in the industry – this is where you and your team can gain a strategic advantage with FitmentPro.
FitmentPro is our solution to gaining this automotive advantage. Not only will this software tool help keep your automotive catalog up to date with the aftermarket trends, but it will also empower your customers to find the perfect part in record time and so much more. Click here to learn more and book a demo with a member of our Dev team today. You’ll be blown away when you see how this feature can help your site perform at top speed while serving the product catalog search results for your customers.
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email: [email protected] and [email protected]
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Phone (USA): (513) 469-3346
4665 Cornell Rd. Suite 255
Cincinnati, OH 45241
