Digital technology has transformed the dynamic of customers through interactive vehicle buying experiences. Customers can now walk into a dealership with more knowledge than before and not get persuaded into buying anything they do not require. This gives customers a sense of authority to make their own decisions, rather than being influenced into making decisions due to a lack of awareness.
OEMs are keen to sell directly to their customers; the only challenge is the absence of digital resources. This blog will help us understand aftermarket e-commerce market growth and how direct reconnection of OEMs with customers will change the current automotive landscape.
Shift in Customer Expectations Over the Years
Original equipment manufacturers have always tried to explore their ways of developing direct relations with their customers and exploring the e-commerce model. OEMs have had a reliable reason to not take any chances due to a lack of digital tools in the market. However, this has not impacted OEMs from changing their existing strategies to adapt to a new model that accommodates the e-commerce model.
1. Constant Digital Transformation
Advanced technological development has put a tremendous amount of pressure on OEMs and their existing methods of customer experience. Customers expect to shop from the comfort of their homes with the transparency offered by e-commerce platforms in electronics and retail.
This shift or the pressure to navigate the existing service strategy has been the sole reason for consumer behavior. Consumers expect a streamlined purchasing process, transparency, and real-time visibility of the inventory like that of an e-commerce platform. With time, this transition evolved from a choice to a necessity for OEMs to stay relevant in the aftermarket amongst their competitors.
2. Why Direct Access is Valued
Consumers today prefer purchasing directly from OEMs due to the following factors:
A. Trust
Since OEMs are the most trustworthy source, a direct relationship minimizes any chances of counterfeiting. This has always been an issue of concern in the aftermarket industry due to the complexity and safety implications associated with the same. This direct bond increases brand loyalty and reinforces the value of products provided by OEMs.
B. Convenience
Direct relations and transactions with OEMs can significantly streamline the process of purchasing along with detailed product information and technical specifications. With better experience and easy return policies, consumers can get immediate and hassle-free services.
C. Quick Access
With direct access to buying from OEMs, customers can enjoy the privilege of navigating through the common supply chain inefficiencies including delays and backorders. This has resulted in a better customer experience, further increasing customer satisfaction.
Challenges Associated with Aftermarket E-Commerce Sales for OEMs
1. Maintaining Dealer Relationships
Dealers directly depending on the revenue generated by parts sales may perceive the aftermarket e-commerce sales model as a threat. For OEMs to efficiently manage this transition, it is essential to come up with a model that practices profit sharing and strategic communication.
2. Complexities
Handling direct sales becomes a different challenge for OEMs as it makes the process more complex. Making each part available and delivered on time ensures that the supply chain is not compromised at any point.
3. Data Management and Integration
Uninterrupted communication between dealerships and OEMs is necessary to avoid any inefficiencies. To enable accurate sharing and real-time monitoring of data, it is essential to integrate efficient software solution that allows seamless communication within the department providing valuable data between both parties.
4. OEMs Do Not Wish to Bypass Their Dealerships
OEMs want to keep their traditional procedures intact for order fulfillment and to maintain strong relationships with their dealer networks. This balance is a necessity to maintain effective distribution.
Effective Strategies to Sell Directly to Customers Without Bypassing Dealers
1. Revenue Sharing Models
Active revenue-sharing models must be implemented to make B2C a success as it is essential for sustaining a good OEM dealer partnership. The model must equally distribute revenue keeping in mind the role played by dealerships in fulfilling customer orders and maintaining a better personalized relationship.
2. Customer Centric Approach
Prioritizing customer centricity is crucial to understanding customers' needs and providing personalized solutions. OEMs effectively practice data-driven decision-making by understanding customers' choices, pain points, and behavior. With the help of insights, OEMs can provide customized pricing strategies, marketing campaigns, and product offerings that foster better customer relations.
3. Digital Innovation
Leveraging technology through seamless integration is an essential step in real-time data monitoring, as it contributes to reducing the risk of overstocking or understocking. For decision-makers and Original Equipment Manufacturers (OEMs), integrating digital solutions enables operational efficiency, organizes supply chain management, and improves the overall customer experience. It also enables dealerships to quickly act upon fluctuations in demand while keeping the ecosystem stable and driving growth.
4. Dealer’s Role
Dealers can directly get online and start selling to customers through cloud access. This is generally controlled by OEMs who can allow dealerships to sell and access the information by making an entry. With this authority, dealers can manage their pricing strategies.
Effectively Integrating Technology
To maintain a strong relationship with dealer networks, OEMs must invest in the right technology. OEMs must select a software solution that effortlessly integrates with the existing systems and maximizes the efficiency of all departments.
1. Unified Channel
A unified communication channel is essential to ensure that the customer experiences consistent service across all means whether online or within a dealership. The perfect example of this could be a scenario where the customer orders a part online and chooses to physically pick up the order and get it installed at a local dealership. By integrating online features with physical services, OEMs can successfully preserve the importance of dealerships while transitioning to a better sales model.
2. Data Analytics and Insights
Utilizing data analytics can result in being fruitful when it comes to forecasting inventory demands. By analyzing the purchase pattern closely, OEMs can efficiently stock parts while reducing the risk of overstocking and understocking. Predictive analytics is an efficient way for OEMs to understand market trends and consumer preferences. Based on this data, personalized marketing strategies can also be implemented to reach the right audience. This not only increases customer engagement but also contributes to better sales.
3. Electronic Parts Catalog Software
With the help of the right electronic parts catalog software such as Intelli Catalog, OEMs and dealers can present a better experience for technicians as well as customers. This software allows dealerships to visually inspect the parts ensuring that the right part is selected, reducing errors and additional costs. Electronic parts catalog software also provides a step-by-step guide on the installation or repair process that minimizes errors and increases the trust of the customers.
4. User-Friendly Interface
Dealerships usually struggle with accommodating new technology, in such a scenario providing a user-friendly interface is of utmost importance. The interface not only helps dealers generate packing slips, and manage order and shipping updates but also helps customers locate the nearest dealership easily.
Aftermarket E-Commerce: What Is the Future?
If the direct-to-customer model becomes a mainstream practice, the next decade will witness the transition of the industry toward hybrid operations. Where dealerships were once focused on the sale of new vehicles, will now pivot towards a service-focused hub, that handles maintenance, repairs, and one-on-one customer support.
Data-driven insights will play a critical role in the whole process as inventory as well as tailored marketing will solely depend on these metrics. While the shift is crucial and will contain strategies that must strengthen the relationship between dealerships and OEMs, ultimately the e-commerce approach will increase the overall efficiency.
In Conclusion
Digital Integration and technological advancement have transformed the aftermarket as customers are more inclined towards transparency, better purchasing experience, and streamlined processes. With efficient utilization of technology, OEMs can deliver real-time updates of inventory, progress, and much more through a unified communication channel.
The future of the aftermarket industry will shift towards a hybrid approach where OEMs and dealerships share revenue through professional services and not just by the sale of new products. Implementing the right software to streamline the aftermarket e-commerce process is also crucial for a seamless transition.
One of which is the integration of an efficient parts catalog software, Intelli Catalog, that enables different teams to collaborate in real-time for precise information on stocks and to predict upcoming demand. To know more about the parts catalog software, contact us and receive a free demo today.
