Auto Parts Ecommerce in 2017 – What Can We Expect?

Since it’s the beginning of a new year, we’d like to share some of the items that we’re paying attention to as far as auto parts ecommerce is concerned. Specifically, these are areas where we expect to see some meaningful changes.

Personalization and Content via Artificial Intelligence

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It sounds ironic, but artificial intelligence should actually increase personalization. It used to be that only the wealthy had personal shoppers, but advances in AI will create a more “catered-to” experience for all consumers.

Through tracking and analytics, marketers already collect data about your customers’ or potential customers’ purchases. This information can then be used to target consumers for ads and special offers, but the implementation isn’t always “smart.” With the use of AI, marketers will be able to improve both targeting and the types of offers being made to consumers, further boosting ad performance.

Content creating is another area where AI will likely offer some valuable. Many auto parts websites struggle with the task of creating unique descriptions for every product. With AI, it may be possible to write quality, unique descriptions for tens of thousands of products for a very low cost. The key is to make sure this content offers information the consumer will find useful.

Chatbots

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The idea of “bots” interacting with your retail customer may sound cold and futuristic, but 2017 may be the year to implement this ever-evolving technology.

Another implementation of AI technology, chatbots can be used to ask customers some preliminary questions and help that customer find the product on your site or direct them to the best location to search for the item. Unlike human powered chat, bots don’t draw payroll and never sleep. In the right implementation, a chatbot can conceivably boost sales.

The challenges with a bot are numerous:

• The bots must connect seamlessly within your business’s infrastructure. This may present challenges and require updates. The bots will need access to email, website, and possibly social media to gain an effective customer view.
• Bots aren’t currently very sophisticated, so they may help your customers over some hurdles yet frustrate them with limited abilities.
• Your chatbots need to represent your brand. Designing and programming bots to the voice and service-level of your brand may be difficult.
• Some customers will have privacy and security concerns. We’ve all been taught to be careful with our credit cards and personal information, so will consumers offer these details to a chatbot? If the adoption of mobile shopping and mobile wallet applications are any indication, the answer is Yes.

Still, 2017 seems like the year that chatbots will start to be found on ecommerce websites, either as customer support tools or as sales tools.

An Increasing Array of Popular Payment Options

Currently, ecommerce customers expect etailers to support credit card and PayPal payment methods. But 2017 seems likely to shake up the payment option list a bit, as there are additional payment options gaining in popularity.

• Digital wallet options like Apple Pay and Android Pay are starting to ‘catch on’ with some consumers, as consumers are becoming accustomed to paying for transactions with their smartphones.
• Amazon’s new AmazonPayments offering is likely to catch on with Amazon’s most frequent online customers, which could make it a good addition to any ecommerce website, as Amazon’s customer base is massive and eager to buy online.
• While the future of Bitcoin is still quite hazy, so called “cryptocurrencies” are essentially another type of digital wallet. However, unlike Apple Pay or Android Pay, Bitcoin (and similar currencies) is not sanctioned by any national government. Should that change in 2017, it’s likely that there will be a push to add support for Bitcoin (or whatever) to ecommerce sites.

More Emphasis on Automated Marketing

Automated marketing will continue to grow, with an increasing array of systems that tie together automated email follow-up and retargeting ads with behavior based triggers and predictive analytics. Just like AI, we expect automated marketing systems to become smarter and more affordable in 2017.

Like any other marketing tool, automated systems are only as effective as the strategy behind them. At Spork, we’re constantly looking for ways to integrate automation into the work we do for our clients. Hopefully, we’ll have something interesting to share in 2017.

Minimum Advertised Price (MAP) Policies

After-market auto accessory manufacturers have come to adopt MAP (Minimum Advertised Price) policies pretty much across the board, but the replacement part manufactures (both aftermarket and OEM) have yet to adopt these policies.

The case for MAP is quite strong, at least if you’re in the business of manufacturing or selling auto parts and accessories:

• MAP policies make it possible for brick and mortar retailers to stock parts, without worrying about online competitors with lower overhead undercutting them
• MAP policies allow manufacturers to limit discounting, which can serve to weaken a brand’s perceived value
• MAP ensures all retailers are profitable, boosting their ability to market and sell more product

You didn’t hear it from us, but we expect an automaker to flirt with MAP policies for replacement parts in 2017.

If there’s a downside to MAP, it’s that etailers need to get very, very good at marketing. When you take away pricing differences, consumers will make their decision on convenience. If parts cost the same online as they do at the local parts store (or dealership), online retailers will need to differentiate somehow to “win” the business.

Video Just Keeps Growing In Importance

Emphasis on video for ecommerce continues in 2017

This year will bring greater and greater emphasis on video for etailers. YouTube is already a tremendous tool for promoting new products (particularly in auto parts), and we expect that to continue as more and more retailers adopt video marketing strategies.

In a perfect world, auto part and accessory manufacturers would provide both sales and instructional videos for their products, which etailers could then add to existing product pages. The problem, of course, is cost. These videos are expensive to produce and difficult to promote.

NOTE: See this article for more information about the four types of online videos that manufacturers and etailers need to focus on.

Etailers who are eager to jump into video production should focus on creating brand development videos that highlight the unique values of their company. A ‘documercial’ type video that shows your business, an interview with founders and/or key personnel, and puts a human face on your company is a good place to start.

Review or product round-up videos are a good option next, as you can contrast a range of products and show consumers how they differ in an easy to digest format.

New Auto Parts Ecommerce Platforms

The rapid growth in online consumer demand for auto parts hasn’t gone unnoticed by the programmers or the world. We’ve spoken with a couple of companies that will be debuting new auto parts ecommerce platforms in 2017. This is good news for auto parts etailers, as increased choice almost always leads to better pricing and better quality products.

NOTE: If you’re looking for a new auto parts ecommerce platform, be sure to check out our list of auto parts ecommerce website platforms and providers here.

A Recession (!)

Last but not least, let’s talk about the elephant in the room: The US economy has been growing steadily (albeit quite slowly) for 7 years. Looking at economic data from 1945 to 2001, the economy has expanded for an average of 5 years (or so), followed by a recession lasting a year (or so). While we can’t rely on history to predict the future, it’s safe to say that a recession is more likely the longer this period of growth continues.

This unemployment chart from The WSJ does a good job of illustrating the boom/bust pattern of the US economy. Of note: The amount of time that has passed since the last recession has been longer than any expansion period since 1960.

With the threat of a trade war with Mexico and/or China, and somewhere between one third and one half of all auto parts being produced in these two countries, the auto part and accessory industry must be particularly mindful of economic risks in 2017. If we plan for the worst and hope for the best, we’ll all be in good shape.