Aftermarket eCommerce Sales are On The Rise (and aren’t going anywhere)

Our world is changing rapidly. While this sentiment extends across the globe, it echoes particularly strongly within eCommerce. Buying trends, consumer behavior, and managing fulfillment seem to be shifting every day. 

For those in the aftermarket industry, unprecedented opportunity is on your doorstep. 

The global automotive aftermarket industry is expected to reach $722.8 billion in 2020. According to aftermarketNews, Hedges & Company found that online revenue during the week of May 17-23 showed a 56% increase in comparison to 2019. This trend was particularly relevant in Powersports which experienced a 121% increase. 

So, what’s driving the change?

Historically, aftermarket eCommerce has trailed industries like fashion, electronics, and household goods in the shift to online purchases. But that all changed in March. In 2020, companies like Advanced Auto Parts and O'Reilly Automotive reported quarterly declines as compared to last year, but sales didn’t plummet all together. 

Why? Online activity was on the rise. 

Hedges & Company reported that when comparing the first 10 days of May to March, the average conversion rates for their clients increased by a whopping 11.1% with an increase in website visits up 6% from March. While these sales only began to spike after the first round of stimulus checks were released, it’s becoming clear that this shift in purchasing behavior is here to stay. 

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What could go wrong?

The increase in aftermarket eCommerce demand presents opportunities for new and experienced sellers to leverage both their own brands and large product catalogs. But there are many pitfalls that can, if not addressed, run your business into the ground. 

1. Inaccurate/poor fitment data. Challenges with quality fitment data continue to plague the aftermarket industry. While retail sales are not immune from such challenges, it is incredibly costly for online sellers due to the cost of returns and poor conversions.
2. Fulfillment bottlenecks. Both domestic and international supply chains struggled this spring to fulfill orders due to shipment delays and facility closures. Insert a COVID outage sending fulfillment centers into lockdown, unfulfilled orders hit unprecedented levels. 
3. Small catalogs. Investment 101 tells you to diversify, and this is no different for aftermarket sales. Even if you thrive on your own branded products, we suggest looking at suppliers like Turn14, Meyer, and Keystone to expand your product catalog. 
4. Single-channel strategies. Gone are the days where an Amazon storefront can independently thrive. Sellers, especially in the automotive market, are expanding their listings to rising channels like Walmart and reinvesting in eBay motors. 

What will go right?

1. Rich listings with fitment data. SEO within eCommerce isn’t going anywhere. Whether you are a new seller or a major brand, building rich listings with ACCURATE fitment data has never been more critical. Search volume and conversion rates are skyrocketing for automotive parts companies, but you need strong listings to see this impact on your bottom line. 
2. Working with the best wholesale distributors. Diversifying your catalog is easy with the right partners. Wholesale distributors offer millions of unique products available through drop shipping, but not all WDs are created equal. The wrong partner can run your seller score into the ground before you even know what hit you. Remember if they don’t fulfill it’s your reputation on the line. 
3. Focusing on multiple high-performing marketplaces. There are millions of marketplaces, but again, not all are created equal. Unless you are using a fully-automated listing/fulfillment system, be careful of the additional management headaches that might be coming your way selling on small marketplaces. 
4. Building your own brand. Whether you manufacture your own products or are simply relabeling, this is an excellent time to start building a brand and a loyal customer base. Particularly if you are selling performance parts, brand loyalty can significantly increase the lifetime relationship with your customers and reduce your future customer acquisition cost. 

If you are already selling in the aftermarket industry, hopefully the past few months have opened the door to unprecedented sales volume. Now, more than ever, is a great time to evaluate your strategy and scale up your online presence. 

But we know scaling isn’t easy. And after supporting automotive sellers across the globe, we have a few tricks up our sleeve we’d love to share with your team. Just give us a call.