E-commerce to drive holiday aftermarket sales
Retail sales have been increasing over the past few months but are still way behind the year-ago levels. According to a new report from eMarketer, holiday sales are projected to grow, especially with e-commerce. Also, despite millions of job losses, the retail sector has somewhat bounced back, thanks to e-commerce.
E-commerce to Boost Holiday Sales
According to eMarketer, retail sales during the holiday period are predicted to reach $1.013 trillion, just under a 1% increase from last year.
The majority of this year’s sales should get a boost from online shopping. Sales at brick-and-mortar stores are expected to account for 81.2% of the total retail sales, ( a 4.7% decline) this holiday season. However, online sales are projected to surge by 35.8% this time.
E-Commerce Saving Retail Sector
According to eMarketer, U.S. online sales will likely reach $794.50 billion this year, up 32.4% year over year and accounting for 14.4% of all retail spending. It also expects e-commerce sales to reach 19.2% of all U.S. retail spending by 2024. The increase for 2020 is much higher than the 18% gain predicted by the company in the second quarter.
Busiest Shopping Days for the Automotive Aftermarket
Although the 2020 holiday shopping season kicked off earlier this year with Amazon Prime Days and competing retail promotions in mid-October, it’s only the beginning for 52 percent of U.S. consumers who plan to start their shopping on Thanksgiving Day or later, according to the recent NPD Group Annual Holiday Study. In general, Cyber Monday, plus the first three Mondays in December, are the most important online shopping days for auto parts in the holiday shopping season. The first three Tuesdays in December are very busy on auto parts websites.: Dec. 1, 8 and 15 according to Hedges & Company, with lots of anticipated action on Sundays as well.
Holiday Shopping Deals
With concerns about the state of the U.S. economy, consumers are on the lookout for special deals and offers to trim costs. Shoppers reported that they plan to spend an average of $691 this holiday season, which is less than last year’s anticipated holiday spending but on par with 2018 plans. The NPD study found free shipping to be the number one factor influencing where consumers decide to shop this holiday, corresponding with the increase in online shopping throughout the pandemic.
Hedges recently shared a few other marketing promotion tips for those that sell auto parts and accessories during peak holiday shopping days:
- Determine your holiday deals early, to allow yourself plenty of time to get the word out
- Prepare your Black Friday email marketing and social media posts ahead of time
- Add your promotions to your Google Merchant Center feed so your offer shows up in Google Shopping
- Create marketing pages soon enough to give search engine bots enough time to index them
- Follow search engine optimization (SEO) best practice with any pages for your holiday auto parts deals
- Best practices for SEO and for user experience should include interlinking from the home page
- Don’t use a new URL each year, recycle your Black Friday or Cyber Monday URLs. For example, don’t use /auto-parts/sale/2020/cyber-monday/, instead use /auto-parts/sale/cyber-monday/
Black Friday/Cyber Monday is one of the most underutilized selling seasons in the automotive aftermarket with tremendous potential. It’s even an effective season to sell traditional hard parts and automotive accessories if you utilize wish lists so non-automotive friends or spouses can comfortably buy gifts for an auto enthusiast.
Retail online holiday sale projections for the Automotive Aftermarket
Holiday e-commerce spending is poised to exceed $189 billion in the U.S., according to Adobe’s most recent forecast, 33% year-over-year growth. Nearly any industry had a dramatic shift to eCommerce this year due to COVID-19. The auto parts industry is no exception. E-commerce revenue in the auto parts market alone was originally projected at around $14.1 billion for 2020. An incremental $1.9 billion in revenue is shifting to the auto parts industry eCommerce, above the original forecast, to exceed $16 billion, a huge 30% increase over 2019.
There’s no doubt that e-commerce will see substantial gains over last year due to new holiday shopping patterns driven largely or entirely by COVID. Adobe anticipates Thanksgiving week to see big gains over last year, especially Black Friday and Cyber Monday. But Black Friday will see substantially fewer consumers in stores because of the pandemic. Most specials will move online and retailers plan to close for Thanksgiving day this year, fueling more online shopping.
Online shopping predictions
Buy online pick up in store (BOPIS) and curbside pick up will also see increases, and could be a lifeline for physical retailers. Adobe says BOPIS will be up 40% over 2019 and that shoppers are “9% more likely to buy at retailers offering BOPIS/curbside pickup on big sale days.”
Smartphones are expected to drive the majority of online retail traffic and 42% of actual sales. Auto parts e-commerce market share transacted on mobile phones will account for $10.4 billion in the US in 2020. That’s about a 40% increase over 2019, when mobile reached $7.4 billion.
It’s common for auto parts and accessory websites to have more than 65% of total traffic on mobile devices – a trend in online shopping that will continue. One thing driving mobile eCommerce revenue is cross-device conversions. It’s common for a shopper to visit a website multiple times over several days or weeks, using multiple devices: maybe it’s a computer during the day at work and a phone at home in the evening. When a buying decision is reached, a shopper’s mobile phone is often the last device used to check out and buy a product.
2020 has been a very unpredictable year, but e-commerce growth is a sure thing and multiple surveys have confirmed that holiday shopping is already underway, following Prime Day.
The internet will be the starting point for most consumer shopping journeys this holiday season. That means a fully optimized online presence is critical, especially for the automotive aftermarket. Small businesses won’t be able to count on foot traffic and in-store browsing as much as in years past.
Retailers need to utilize every marketing tool available to gain an advantage this year. That includes Google Shopping/Local Inventory Ads and product feeds, discounts, shipping incentives, BOPIS and curbside pickup.
Influencer marketing in 2020
Influencer marketing involves using content creators to help improve their brand through increasing awareness, increasing traffic and pushing the brand’s message to target audiences – this is achieved because the influencers already reach your target audience through their various channels.
Channels include social media, advertising (both traditional print and digital), blogging, columns, and more. With the growing digital landscape, influencer marketing is on the rise, and the traditional means are becoming less attractive and effective in leading customers to purchase decisions and loyalty.
Influencer Marketing helps businesses to achieve:
- Increasing Brand Awareness
- Reaching New Audiences
- Generating Sales & Conversions
Influencer opinions and recommendations have the ability to have a significant impact on spreading messages through word-of-mouth mechanisms to help deliver the important messages to the consumer – this creates social proof and builds consumer trust. This tactic is often used as part of Integrated Marketing Communications (IMC) in the digital realm amongst broader channel strategy using traditional means, it is a highly effective way to leverage trust and speak to your audience in mass amounts.
The coronavirus and advancement in technology has impacted the influencer marketing landscape. It is important to look at new emerging trends to ensure your strategy is effective and helps to drive sales. In 2020, thus far, statistics have shown that the coronavirus has impacted digital advertising and in particular, influencers – with 94% finding it to be effective in boosting sales for brands.
Innovation is becoming a very noticeable trend in all industries, including the influencer realm, which means there is a new need to reach consumers and promote your brand’s messages. These changes call for action from marketers to adapt and make changes to their approach:
1. Growth from micro-influencers
Even though it may seem like the micro-influencers (10K-100K following) would be the smallest of them all – they typically generate the greatest number of consumers. Despite the big difference in followings between micro-influencers and celebrities – this actually garners trust and higher levels of engagement with their audiences due to trust, relevance and less competition, for lower costs.
2. Extending influencer campaigns to other platforms
Instagram is said to be the most important platform for influencer marketing however, brands need to look into other platforms that will really enhance and utilize the growth in live content and interactive media such as YouTube, Tik Tok, snapchat, Facebook, Twitch and even Pinterest.
3. Regulations and transparency
The FTC are always looking at ways to ensure best practice is adhered to with influencer marketing. These guidelines (e.g. influencers must disclose relationships with brands or must use the product/service before promoting it) must be followed by brands who perform influencer campaigns. How to:
4. Consistent, sensitive messaging
In these challenging times, brands have needed to ensure they are not running insensitive campaigns and are treading softly in order to avoid coming off as tone deaf to consumers. Many brands are also trusting their influencers to also focus on their tone and represent their values.
5. Live content
Live Content is becoming the way of the future along with interactive content. Marketers and content creators need to follow this trend and incorporate it into their work and find new ways to benefit from this. Video messaging also helps you leverage the shift to storytelling which helps to evoke emotion and grab attention using product demos, Q&As, and interviews with internal team members.
This year has been shaken up by COVID-19, causing lots of challenging uncertainty for brands. As long as marketers continue to adapt to the new landscape, and influencers can keep up with new emerging data and exploit these trends in their campaigns, these brands will reap the higher ROI.
READ MORE HERE: wearcape.com
Automotive Aftermarket 2020 market is booming worldwide
Thanks to the recent progression of technology and developments, the Automotive Aftermarket market is expected to grow exponentially, at a rate of 4.2% CAGR by 2027, according to a new report from Emergen Research.
In this week’s Virtual AAPEX Show, participating industry executives discussed the growth they’re seeing and offered a positive outlook on the future of the automotive aftermarket: that the automotive aftermarket continues to be resilient despite the crisis.
“Compared to most other retail sectors, the aftermarket sees much more stable demand. We are essential and we’re a great market to be in, rain or shine,” said Paul McCarthy, president, Automotive Aftermarket Suppliers Association (AASA).
“The aftermarket is forecasted to grow 11.7% in 2021 and is on its way to a market size of $341 billion in 2023,” said Bill Hanvey, president and CEO of the Auto Care Association.
Industry executives also weighed in on the outlook for the aftermarket in this time of uncertainty and how the pandemic has challenged their leadership skills.
COVID-19 has affected the global economy by interfering with production and demand, causing market disruption, and inducing financial instability. Participants discussed the industry’s resilience through decades of various economic changes and noted silver linings – like fewer car sales and consistent maintenance resulting in more aftermarket sales.
Leaders anticipated the continued growth of e-commerce as a permanent effect of COVID-19.
“I believe online ordering will continue to increase … I also think we’ll see more automation in the manufacturing and distribution centers and warehouses and I believe it’s going to continue to be hard to find workers,” said Sue Godschalk, president of Federated Auto Parts.
Other trends discussed that have boosted the industry recently are people having more time to work on their cars, an increase in vehicle ownership, more people repairing and maintaining their vehicles and more DIY, and a decline in people using mass transportation.