Akron, Ohio— With about 80% of consumers researching tire purchases online — and a growing percentage of consumers buying tires on the web — it is important for tire dealerships to sell tires and installation services on the internet, according to eBay Motor's director of parts and accessories, Marie Niewiroski.
In a webinar — "5 Tips to Growing Your Online Tire Sales" — broadcast 25 Sept as part of the Tire Business Educates Live Online Conference, Niewiroski said it is important for independent dealers to have an online presence in order to grow their businesses.
"With all the technology out there, consumers have all this information at their fingertips, different brands, different prices. And so they do a lot of research, not only in tires but in any industry. So having a presence online is very important for your business that can really help it grow," she said.
"More than 80% of consumers search for tires online. That is a staggering number. It doesn't necessarily mean they purchased online,…they do a lot of their research."
She noted about 43% of these consumers are looking at prices and brands; more than half of consumers are migrating to different brands because of price or tread life; and eventually 12% of these consumers end up buying tires online.
"We're seeing huge growth in this as well, the shift from offline to online sales. We're seeing growth rates of 20% year over year. It's definitely starting to explode," she said.
"Although tires is one of the last industries to join the trend of online sales,…we are seeing that the trend is growing quite a bit."
Niewiroski claimed about 96% of consumers who buy tires online are apt to buy again online. She said the youngest generation of consumers are more likely to shop online due to the convenience and self-serve options.
Her advice for dealers to boost online sales are:
1. Move from good-better-best to a spectrum of value
"We find that these online consumers are very savvy. They do a lot of this research (and are) more savvy than your offline consumers.… They want to compare the value and the price and really what's out there at the end of the day.
"In order for you to grow your online sales, you want to make sure that you're not just carrying Tier 1, Tier 2 and Tier 3 tires, but that you're carrying Tier 4 as well, at least for your online business in some way, shape or form," she said.
She noted Tier 4 brands are growing in popularity and since online shoppers are comparing prices on different sites, dealers should at least offer some value-priced tires to attract online shoppers initially.
"You want to make sure that you're in that mix, so even if they don't necessarily buy a Tier 3 or Tier 4 brand, they can still come to your website and see what you have to offer. We find people sometimes come in looking for a Tier 1 or Tier 2 brand and they shift over to a Tier 3 or Tier 4 brand and vice versa," she said.
"They just want to do a search for cheap tires and as they start doing the research, they will land on a Tier 1 or Tier 2 brand. So it really all depends on the consumer preferences, the research they do."
2. Seize the retail moment
She encouraged dealers to do promotions during the spring and fall selling seasons and stock enough inventory for those seasons.
She also advised online retailers to promote any manufacturer rebates that are available and create their own coupons, noting these are really popular with consumers.
3. Optimise your listings
She stressed the need to offer fast, and free, shipping — a perk most online shoppers have come to expect.
"I know that's tough in the tire industry because free shipping can come at a cost. But we see that sales increase by 50-plus percent when offering free shipping. This is really what consumers are used to at the end of the day. It's kind of a retail standard," she said.
"It is tougher for tires. They're big. They're heavier to ship. But we see when it is offered in tires, you will see a huge increase in sales."
She also noted that two- to three-day delivery time frames create a better user experience, which leads to buyer retention.
"Once you offer this fast and free shipping options and you have a good variety of tires to offer and you have great customer service, you will definitely gain that buyer back in five to seven years when they go to replace their tires again," Niewiroski said.
She also suggested that dealers advertise prices for sets of two or four tires, rather than individual prices, because consumers don't like doing the math when buying multiple tires.
She suggested dealers offer discounts on sets of tires.
4. Expand your reach by being multi-channel
Niewiroski suggested dealers not only invest in their own online store but also expand into other online marketplaces, such as eBay, Amazon and Walmart.
"This really helps you build your brand," she said. "And by investing in SEO and catalog, that will drive traffic to your store. So whether it's your own online store and you're investing in SEO directly in Google, etc., but also investing in marketplaces, you get to leverage all the traffic through eBay, Amazon, Walmart, etc."
Within the online marketplaces there is a trust system, where consumers provide and read reviews and ratings on tires and retailers.
"Research has shown that from shifting offline to adding online, you can increase your sales alone by 10%. So this again is your own online presence. But when you add on one marketplace, you will increase online sales by 38%; in two marketplaces, up to a 120% increase in sales," she said.
"That's the advantage of leveraging marketplaces with all their traffic and sales and marketing and loyalty in general — to truly take online sales to the next level," she said.
5. Provide convenience by offering installation
"This is about offering that end-to-end experience for your consumer," Niewiroski said.
"They're doing their research online, and right then and there they want to purchase the tires. But on top of that they want to purchase installation and kind of do it all upfront so when they bring in their car, they can literally just hand it over and say, 'Here you go. I'm ready to get my tires installed.'"
She said between 40% and 60% of online shoppers add on installation services when they're offered for the tires they purchase. Often, online shoppers want to know upfront the full price of the tire purchase/installation package.
"Consumers make a decision from not only the tires but the installation as well. They want to know what the full job is going to be. So when you offer installation online, you do get that price transparency and what it includes from start to finish. So they can make that purchase more confidently online," she said.
She noted that once the online customers arrive at the dealership, the dealer has an opportunity to upsell them on any other services they may need.
Niewiroski encouraged tire dealers to become recommended installers for large online tire retail networks, such as Tire Rack or Tire Buyer.
"You may not get that tire sale, but you can get that installation and still get that customer through offering installation at your shop. This is something you definitely want to do," she said.
"You want to make sure your shop is part of an installation network as this industry grows and offers tire installation online."