Lang Aftermarket iReport: New competitive factors in ‘Do-It-For-Me’ supply
“The competitive analysis of Distributors who supply parts to repair outlets (the Do-It-For-Me market) generally has been focused on four major factors: Ordering Systems, Availability, Pricing and Delivery. However, three additional competitive factors have emerged in the changing Do-It-For-Me (DIFM) market that can provide significant advantages to Distributors that supply parts to repair outlets.”
— Jim Lang, publisher, Lang Aftermarket iReport
Four Conventional Competitive Factors
In supplying parts to repair outlets (commercial accounts) four competitive factors are generally cited: Ordering Systems, Product Availability, Product Pricing, and Timely Product Delivery.
Three Emerging Competitive Factors
In the evolving Do-It-For-Me (DIFM) market, three additional factors have emerged that can provide significant advantages to Distributors in this highly competitive environment.
Factor 1: Technical Information
Growing vehicle complexity has made technical information critical for repair outlets to perform rapid diagnostics and parts installation.
Since most automotive technical information is held by carmakers and parts manufacturers, the need of Installers to have this information provides an opportunity for Distributors to partner with carmakers and parts manufacturers to promote the use of their products and brands.
Providing technical information to DIFM (commercial) accounts can provide Distributors a significant advantage over competitors and allow them to provide benefits to Installers that are not readily available from other sources.
Factor 2: Customer Acquisition
By helping to attract service bay customers to Installers, Distributors can provide added value to DIFM (commercial) outlets beyond the services offered by their competitors.
Banner Programs and o2o transactions are two ways that Distributors can help Installers attract customers.
Banner Programs consist of marketing and advertising assistance that Programmed Warehouses and their Jobber customers provide to Installers to help them attract service bay customers.
Banner Programs reinforce the relationship between Distributors and Installers, while helping to expand the business of Installers and the volume of parts they purchase from Distributors.
Online to offline (o2o) transactions are gaining traction in the aftermarket, and they can enable Distributors to help Installers attract customers.
In an online to offline auto repair transaction, Distributors enable a consumer to purchase parts and schedule auto repair through an authorized network of repair outlets.
Ecommerce sellers have taken the lead in o2o auto repair, particularly in terms of Tire sales, Battery replacement, and some common repair jobs such as Brake work. However, brick and mortar Distributors have ways they can use o2o strategies to provide their Installer customers with greater bay activity.
Factor 3: Needed Parts on Hand
There are two general ways that Distributors can reduce the need to rapidly deliver parts to Installers for cars in their bays.
First, Distributors can enable Installers to stock key products that they use on a repetitive basis so when jobs arrive in their bays the need for quick delivery of parts is reduced.
Second, o2o transactions can provide another means to reduce the need for quick delivery of parts. Distributors enable the customer to order repair jobs at Installers. Distributors then deliver the required parts to Installers prior to the vehicle arriving at the repair outlet. These o2o transactions are increasing in number across a broad range of auto repair jobs and associated parts.
These two strategies require financial resources, computing expertise and unique o2o relationships that not all Distributors have in sufficient amounts.
Six Major Takeaways
- Four factors are generally cited as defining the success of Distributors competing in the Do-It-For-Me (commercial market): Ordering Systems, Product Availability, Pricing, and Timely Delivery to repair shops.
- Three additional factors have emerged in the evolving Do-It-For-Me market that can provide competitive advantages to Distributors.
- Providing technical information to DIFM (commercial) for rapid diagnostics and installation can significantly improve the competitive position of a Distributor.
- By helping to attract service bay customers to Installers, Suppliers can add value to their relationship with DIFM (commercial) outlets. There are two major ways Distributors can attract customers to Installers: Banner Programs and o2o transactions.
- Distributors can reduce the need for rapid parts delivery in two ways: enable Installers to stock key products that they use on a recurring basis, and partner with Installers in o2o transactions.
- Distributors vary in their financial, computer and marketing resources and expertise required to effectively take advantage of these three emerging factors that are reshaping the competitive environment of Distribution in the DIFM market.
Copyright 2019 by Lang Marketing Resources, Inc.
NOTE: Special thanks to publisher Jim Lang for granting us permission to publish the Lang Aftermarket iReport.