The automotive aftermarket industry is expected to grow strategic at CAGR of 4.4% over the period of 2018 to 2023. (Market Research Future) In research by Global Market Insights, the industry is expected to exceed $680 billion by 2024.
Driving this growth is increasing vehicle wear as drivers hang onto their vehicles longer, shifting consumer preference towards vehicle comfort, and the desire to enhance efficiency and customization of vehicles.
Research by SEMA breaks down who is buying what through extensive research into different types of consumers, what they are buying, and their level of engagement with their vehicle. Following are some key findings from the report.
Aftermarket Specialty Parts and Accessories
Over 20,000 drivers were surveyed across the United States and the purchases of 5,000 people who modified or accessorized their vehicles were further examined. Data such as what kind of cars they have, how much did they pay for accessories and where they purchased were used to tabulate findings.
The research broke out groups into Non-Enthusiasts and Enthusiasts.
Non-Enthusiasts represent 58% of aftermarket consumers. Within that segment:
- Commuters buy parts to maximize comfort or attain vehicle personalization (26%)
- Do-It-For-Me Buyers represent 22%
- Handyman consumers buy parts and accessories to upgrade their vehicles during repairs or maintenance comprise 10% of the market
Most consumers who accessorize their vehicles (73%) use their vehicles daily. Pleasure driving (32%), occasional use (27%) and work use (26%) trail behind.
The report also looked at age groups and where they are buying:
While many consumers use the internet for extensive research, many buyers will still buy through physical locations where they can handle and feel comfortable with the product. However, the online auto sales market is expected to break $10 billion in 2018, a 16.3% increase over 2017. (Hedges & Company)
Target Consumers Online
With so many consumers researching online and more parts and services expected to be sold online, aftermarket brands must have a strong online presence to attract buyers. The four most popular methods of online research used by consumers before buying are using search engines like Google or Bing (74 percent of all consumers), visiting online auto parts retailer websites (73 percent), visiting manufacturer websites (57 percent), and visiting automotive forums (47 percent).
Online activity will influence nearly $152 billion in parts and accessory sales through all retail channels – chain retail stores, automobile dealers, big box retailers, local independent brick & mortar retailers, jobbers, as well as online sales – by 2021.
E-commerce has also driven the buy online, pick up in-store (BOPIS) trend that is allowing auto parts retailers to capitalize on online sales at their physical locations.
In 2017, AutoZone’s BOPIS sales outperformed ship-to-home sales. Customers are able to choose from thousands of items online and pick up in-store. These customers are typically do-it-yourself (DIY) consumers who are making repairs to their own vehicles.
Target Consumers Using Location Data
92% of retail marketers plan to increase their use of location data over the next two years, according to research commissioned by location intelligence company, Cuebiq.
The research, conducted in April of 2018 among North American marketers and CRM managers in large companies primarily within four vertical markets (automotive, retail, quick-service restaurants and banking), also found that:
- 81% of retailers stated that the use of location data was “very important” in improving their marketing performance. The most cited answers for the use of such data were the need for more detailed information on customer behavior and the desire to better analyze attribution (both mentioned by 50% of retailers).
- Retailers are more likely to use customer-level point-of-sale data than the other categories surveyed (66% vs. 55%). Retailers are also more likely to describe themselves as having access to a wide variety of indicators about where people spend time in the physical world (79%).
- 66% of retail marketers said that understanding which other brands/retailers their customers frequent is a key driver for their use of location data. There is also keen interest among retail marketers for competitive intelligence, as 56% of respondents claimed they would be highly likely to deploy the data for competitive intelligence.
- Other significantly high-scoring applications for location data included planning social media ad campaigns (72% highly likely), planning digital ad campaigns (68% highly likely), measuring whether promotions resulted in visits to a store (73% highly likely) and pushing coupons or offers based on proximity to a store (67% highly likely).
Porch Group Media offers a mobile location intelligence solution Signals to target audiences who have visited an automotive service or parts location or are shopping for parts and service online.
Ways in which our clients are using Signals include:
- Target consumers currently receiving service from local competitors. Example: Jane Smith owns an economy car which she purchased directly from the dealership, however, she services her tires, muffler, and has her oil changed at national chains. The dealership where she purchased her car may utilize Porch Group Media Signals to find car owners like Jane and bring them back to the dealership for their oil changes and regular maintenance with the promise of expertise and superior service, perhaps even offering an additional warranty on the vehicle.
- Target consumers who frequently visit service shops. Example: Jane Smith purchased a car from your dealership 3 years ago and has gotten service on her vehicle 2x times over the last 30 days. The dealership may use Porch Group Media Signals to identify Jane Smith as an opportunity to upgrade her current vehicle to a newer model to save money on upcoming repairs.
Auto Retail Stores
- Target consumers who shop at local competitors. Example: Joe Black shops at a local auto parts store that is 5 miles from your auto parts store. Joe would be captured as a consumer who is in the for auto aftermarket retail. The Signal can be enhanced with demographic and auto data to provide the ability to offer a highly-targeted offer across multiple channels.
- Increase repeat business by identifying consumers who are shopping at your store but are not subscribed to your loyalty benefits membership program. Example: Joe Black is identified as a shopper at your auto parts store; however he is not currently a loyalty customer. Porch Group Media Signals would provide you with the ability to offer Joe an opportunity to sign up for your customer loyalty program.
There has undoubtedly been a shift as the rise of e-commerce has touched every industry including the automotive aftermarket sector. Brands must optimize both online and offline strategies to meet the needs of today’s evolving consumers.
Interested in more great resources? Download Porch Group Media’s Automotive Marketing Success Kit – full of articles, podcasts, webinars, and case studies to help you navigate today’s new economic landscape so your dealership can thrive and maintain growth.
Learn how Porch Group Media can help you get to know your customers better and reach them across channels to boost your marketing success. Contact us to get started!