Automotive Industry

Trend Report:
Accelerating Toward
E-Commerce

1 | Automotive Industry Trend Report: Accelerating Toward E-Commerce

Automotive Industry CONTENTS
Trend Report: 1. Recovering From the Recession
2. The Current State of Online Sales in the Automotive Industry
4
5

Accelerating Toward
3. Rising to Meet Customer Demands 6
4. So Why the Slow Approach to E-Commerce? 7

E-Commerce
5. Aftercare 8
6. The Automotive Industry’s Digital Revolution 10
7. Choosing Your E-Commerce Solution 11
8. Quality and Supply Chain Management 12
9. The Benefits of an Integrated Solution  13
10. One Automotive Business’ Approach to E-Commerce 15
11. Winning the Race 16
 1 Introduction
If you are involved in any part of the automotive supply
chain, e-commerce is bound to be on your mind. Read
on to find out what e-commerce has to offer you, if it’s
right for your business, and how you can do it better
than your competition.

We’re answering these questions and more:

 hat is the current state of e-commerce in the

W
global automotive industry?
How has the industry dealt with recovery since
the recession?
What do the current trends and statistics indicate
for the future?

3 | Automotive Industry Trend Report: Accelerating Toward E-Commerce

 1 Recovering from the Recession
The global automotive industry has been growing
slowly but steadily since the recession. The number of
cars sold in 2015 totaled an impressive 72.37 million,
and there was an estimated 4% growth in 2016, with
75.24 million automobiles being sold that year.
72.37 MILLION 4%
INCREASE
sold in 2015
4 | Automotive Industry Trend Report: Accelerating Toward E-Commerce
The great news is that growth is expected to continue. In fact,
it’s predicted that the industry will reach its 100 million
vehicle milestone in 2020. Globally, growth is being driven
largely by the Asian and North American markets. China
alone accounted for 24.6 million of the vehicles sold in 2015.
Besides a recovering global economy, an increase in
demand – especially in the aftercare market – has been
largely responsible for the industry’s growth. Now,
businesses at every level of the supply chain are looking at
ways to meet that increase in demand and win over
new clients.
75.24 milLION
sold in 2016
With many other industries growing leaps and bounds
thanks to e-commerce, it makes sense that automotive
original equipment manufacturers (OEMs), dealers and
suppliers are beginning to see the importance of harnessing
digital channels to offer online purchasing to clients and
consumers. So how have they been doing so far, and what do
their prospects look like for the future?
 The Current State of Online Sales
2 in the Automotive Industry
E-commerce sales in the U.S. automotive industry If we look at e-commerce as a whole in the U.S., auto and
have seen significant annual growth in the last four part sales are actually expected to account for 10.5% of
years, and online sales are projected to reach $7.4 total retail sales in 2017.
billion by 2019.
Business is looking up in the DACH region (Germany, Austria
and Switzerland) as well, where it is predicted that vehicle
parts and accessories market revenue will increase
70
2012 2013 2014 2015 2016 2017 2018 2019 by 11% in 2018. And in November of 2016, the Society of
60 Motor Manufacturer and Traders (SMMT) reported that the
UK automotive industry has achieved its best performance
Revenue In Biliion US Dollars

50
since 1999. Over 1.6 million units were built in the first 11
40 months of the year, and 1.25 million cars were exported,
reestablishing the region as a global competitor.
30

20 Now, more than ever, it’s vital that businesses bolster their
clients’ confidence in online purchasing by highlighting
10
23.3 27.5 31.6 36.1 40.8 46 51.6 57.4 and clarifying payment security features on their websites.
0 It’s also time for banks to start providing more payment
REfERENCE: STATISTA 2017 alternatives for online purchasing.

5 | Automotive Industry Trend Report: Accelerating Toward E-Commerce

 Rising to Meet Customer
3 Demands
Where customers go, businesses follow, and right now,
customers are going online.

Consumers are showing an increased interest in buying not

just parts online, but actual cars, both new and old. Research
shows that the closer the shopper gets to the buying moment,
the greater their attraction to the online channel.

Why? In a survey conducted by Capgemini, 45% of

respondents indicated they hoped to get a better price
online, and 23% indicated they wanted easier, faster
transactions.

45%
better price

23%
easier and
faster

6 | Automotive Industry Trend Report: Accelerating Toward E-Commerce

 4 So Why the Slow Approach to E-Commerce?
Despite the numerous indications of a global rise in Take the Fast Track:
automotive e-commerce, OEMs, suppliers and dealers
are still being incredibly cautious when it comes to The good thing about this interconnectedness is that it paves
selling directly online. the way for each part of the supply chain to continue to do
what they do best in the online world. And that’s exactly what’s
This makes sense, to a certain degree: why rock the boat? starting to happen: the automotive industry is adapting an
Things are looking up, and all of the numbers indicate growth. omnichannel approach to online sales.
Plus, OEMs specifically are concerned about shifting the
supply chain and potentially burning the dealers that are such
crucial sources of information.

In fact, according to a survey by Cars Online, dealers actually

account for 55% of all vehicle research available, which is the
highest figure for any source. Besides being valuable sources
of information, they are of course also vital to the sales
process.

Dealers, for instance, are starting to use their websites to

Even in a scenario where the purchasing process happens
provide information, allow clients to schedule test drives,
largely online, dealers will still be important when it comes to
and sell extras, while the OEMs are getting online and
test driving and aftersales support.
selling parts to businesses and consumers after the new
B2X fashion. The aftercare segment has actually been
outperforming their supply chain cohabitants – perhaps
because the cards are stacked in their favor.
ADD TO CART

7 | Automotive Industry Trend Report: Accelerating Toward E-Commerce

5 AFTERCARE
Automotive aftercare is arguably the key player in the
wider automotive industry, accounting for 63% of the
revenue from a vehicle, with just 37% being attributed to
the original sale.

37% ORIGINAL SALE | 63% AFTERCARE

And just like the rest of the auto industry, the aftercare
segment has shown huge e-commerce growth in the past
decade, with online parts purchases predicted to make up
10% of the overall aftermarket by 2020.

Three new trends are undoubtedly contributing to the overall

success of automotive aftercare, but more specifically to its
growing online success.
 1
More Drivers, Older Vehicles
The average age of vehicles is rising globally. The U.S., for
instance, reached a record high of an average age of 11 years
old in 2015 – 1.5 years older than those in 2002 and 14% older
than in 2007. In Western Europe, the typical lifetime of a car is
13 years. Older cars mean more maintenance and more parts
purchasing.
Interestingly, while consumers are slower to buy new vehicles,
they’re actually driving more, with a 1.7% global increase in
driving in 2016.
9 | Automotive Industry Trend Report: Accelerating Toward E-Commerce
Consumers Embrace DIY
Another shift that’s occurring is the way that consumers
care for their vehicles. Perhaps also part of the fallout of the
global recession, DIY has become the name of the game, and
this trend has led to a rapid rise in the online purchasing of
automotive parts. In fact, The DIY market is projected grow
to from $49 billion in 2014 to $54 billion in 2017.
With an increase in the average vehicle age, an increase
in driving, and a growing do-it-yourself culture, there is no
doubt that the aftermarket sector will continue to see rapid
growth. And much of this growth is happening online. Online
parts sales doubled between 2011 and 2015 to reach a
total of $7.4 billion, which is predicted to rise to over $10
billion by 2019.
 6 The Automotive Industry’s Digital Revolution
The digital transformation of the automotive industry
is perhaps the biggest shift with the most impact down
the road.
Consumers and professional buyers alike are turning
increasingly to digital sources in their quest to make informed
purchasing decisions.
Not only does this shift challenge dealers to be flexible in
adjusting their networks and marketing channels in order to
remain relevant, it also offers plenty of opportunities for new
entrants.
If they can take full advantage of digital marketing and online
sales platforms from the get-go, they will be able to reduce
costs, reach a wider audience, and establish their network
more easily than they could have via traditional methods.
10 | Automotive Industry Trend Report: Accelerating Toward E-Commerce
E-Commerce Offers More Opportunities
E-commerce in the automotive industry presents amazing
opportunities. Take upselling and cross-selling, for instance.
Instead of relying on sales agents to get the upgrade or sell
that warranty, an online sales platform allows you to let
customers sell these products to themselves.
And when it comes to all of those extras like financing,
warranties, insurance, aftercare and parts, the new
generation of buyers doesn’t want salespeople
pushing them into making decisions.
They want to have information presented to them in a clear,
concise and comprehensive manner so they can make these
important decisions at their own pace.
E-commerce gives them the room to do that.
 Choosing Your E-Commerce
7 Solution
In an increasingly competitive global economy, one of the
main keys to survival has become efficiency in general
operations, with the goal to streamline operations to
maximize profitability.

ERP systems have been crucial to achieving that goal, as they

allow increased flexibility, scalability, accelerated deployment,
business continuity and usability. In fact, operational
efficiency is the primary goal behind investing in an
ERP for 76% of global parts dealers.

Is your ERP system your key to operational efficiency? Then

it makes sense to integrate your ERP with your web store.
An integrated e-commerce solution uses your ERP as the
foundation of your web store.

It works by leveraging the data your ERP already contains and

complementing it with data obtained through your web store.
That means you can offer clients the flexibility and convenience
of online shopping, while simultaneously gaining access to
multiple data sources you can use to your advantage.

11 | Automotive Industry Trend Report: Accelerating Toward E-Commerce

 Quality and Supply
8 Chain Management
Web stores integrated with ERP systems provide
the capability to track data on all aspects – from
manufacturing to demand – in real-time.

Integrated online sales platforms automatically store the

collected data in archives for future reference. This gives you
the ability to swiftly manage production quality – a critical
aspect in a technical industry such as the automotive industry.

Not only will your data be integrated, your operations will be

entirely integrated too. This provides your managers with an
eagle-eye view of the supply chain, which is optimal for your
business, and which also means you can keep your clients
informed with real-time availability of any product.

12 | Automotive Industry Trend Report: Accelerating Toward E-Commerce

 9 THE BENEFITS OF AN INTEGRATED SOLUTION
A Paperless Environment Integrated Financials
24/7
Managers in every industry strive to achieve the greatest An effective ERP system has the ability to trace costs
possible productivity. A software system that provides associated with individual products and product lines
electronic document management not only saves employees right down to the raw materials used in production. The
time, it speeds up overall operations, reduces waste and integration of web store and ERP system allows data to
minimizes room for human error. flow seamlessly through the organization, where it would
otherwise have been standalone silos of information.
Inventory Optimization
Companies have traditionally built ‘patches’ between
Excess inventory forms a huge unnecessary expense. This
systems or reconcile different reports that would be
is especially true for the automotive parts industry, where
generated from different systems. However, this isn’t
inventories are often comprised of thousands of small parts
necessary with integrated e-commerce, because every
and products that all need tracking.
department has access to the same real-time information.
By linking your web store to your ERP, you have the possibility
to optimally track your inventory, as well as forecast demand
and optimize your inventory accordingly.

13 | Automotive Industry Trend Report: Accelerating Toward E-Commerce

 Improved Customer Support
One of the biggest benefits of integrated e-commerce is
that you can greatly improve your customer experience by
offering a self-service option. That’s because integrated web
stores are able to accommodate large (and personalized)
catalogs that are easy to browse. Integrated catalogs also
offer real-time product information and inventory status,
personalized prices and more.

By improving what happens behind the scenes, you’re

also improving the way your business manages customer
relationships. Integrating your web store with your ERP
system and your CRM makes it easy to drastically improve
your marketing in a variety of ways.

E-commerce also makes it possible to reach out to a larger

audience by finding out who your ideal target group is, for
instance. It also helps you turn more leads into sales, bring
more leads into the sales funnel, retain more customers, and
effectively communicate with clients during all stages of the
purchasing process.

14 | Automotive Industry Trend Report: Accelerating Toward E-Commerce

 One Automotive Business’
10 Approach to E-Commerce
WP Performance Systems, a producer and distributor of
motorcycle components, is one business that’s taking full
advantage of all that e-commerce has to offer.
“We didn’t just want to be a technology leader with our
product. We wanted to be a leader in the area of sales and
e-commerce as well.”

As one of the leading manufacturers of high-performance

components for the motorcycle and automotive industry,
WP Performance wanted to optimize their communication
with dealers and importers worldwide.

As a globally active business, they knew that the internet

would be the best way to solve their problem, and they got to
work looking for a solution.
Martin Greilinger, Aftermarket Sales Manager at WP
Performance Systems, explains what drove their search for
the perfect e-commerce solution:
Sana Commerce made it easy for the company to share
product information and cater to their diverse client base
through personalized online product catalogs. It also doubled
up as a news platform that replaced their email newsletter.

“We didn’t just want to be a

technology leader with our product. We
wanted to be a leader in the area of sales
and e-commerce as well.”

15 | Automotive Industry Trend Report: Accelerating Toward E-Commerce Martin Greilinger, Aftermarket Sales Manager at WP
 11 Winning the Race
Combining an omnichannel approach with an
integrated web store is a game changer for automotive
businesses. Whether you’re selling parts, cars or
services, e-commerce provides a way to serve clients
better and faster.

It lets you engage current and potential clients, and it helps

your business function optimally. The results? Your back
office spends less time on admin and more time on providing
quality assistance and making sales.

The automotive industry is booming. Now is the time

to join the e-commerce movement and future-proof
your business.

16 | Automotive Industry Trend Report: Accelerating Toward E-Commerce

 ABOUT SANA
Sana helps businesses all over the world reach their full potential. We offer the shortcut to
e-commerce. How? Through 100% seamless integration with SAP and Microsoft Dynamics.
Our e-commerce solution leverages existing business logic and data in powerful and user-
friendly web stores. This lets our clients focus on improving customer experience, streamlining
sales processes, and increasing sales volume and frequency.

Sana Commerce is a certified partner of Microsoft Dynamics and SAP. Our innovative approach
and strong partner network make Sana the driving force behind over 1,200 web stores
worldwide. Because of our experience and expertise, we can go all the way, offering not only
a product but also supporting services such as online marketing, Search Engine Optimization
(SEO) advice, hosting, design and online payment providers.

Make your business future-proof and join the e-commerce movement.

For more information, visit www.sana-commerce.com

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