Market Research For Online Auto Parts Sales Now Available
The online automotive parts and accessories sales industry has experienced growth for more than a decade as consumers have increasingly shifted to spending online. According to IBISWorld Industry analyst Brandon Ruiz, “recognizing this trend, traditional brick-and-mortar retailers have entered the online realm in an attempt to bring back sales taken by retailers that sell exclusively online, such as Amazon.com”.
IBISWorld is an independent source of industry and market research (www.ibisworld.com). The company expects total revenue for the online automotive parts and accessories sales industry to increase at an annualized rate of 11.1 percent to $2.5 billion in the five years to 2013, including a 9.8 percent increase in 2013 alone.
Industry revenue growth slowed during the recession as many consumers held off on repairs and maintenance. Conditions largely rebounded in 2010, however, as pent-up demand lifted revenue. Additionally, an increased number of motor vehicle registrations aided growth because more cars on the road translated into a larger market opportunity for industry operators. Moreover, the average age of the U.S. vehicle fleet increased in the five years to 2013 as consumers postponed new car purchases; since older vehicles typically need more maintenance than newer cars, this trend benefits industry operators. In 2011, revenue surged with many retailers (e.g. AutoZone) that operate in both the offline and online marketplaces reporting stronger online demand.
The industry is expected to continue to grow during the next five years, as sales continue to shift online and increased disposable incomes result in greater sales of replacement auto parts. However, increased competition from large online marketplaces, national auto parts retailers and wholesale aftermarket auto parts distributors is expected to limit growth. Although the industry caters to the do-it-yourself market, these consumers still seek professional advice for automotive repairs and upgrades.
“To compete, online automotive parts and accessories retailers are expected to offer more online services, including tutorials, auto repair software and live customer service representatives”, said Ruiz. Over the long-term, as consumers increasingly search for auto repair advice online, the advantage held by auto parts stores will diminish.
Market share concentration within the online automotive parts and accessories sales industry is low. The industry is generally fragmented, with a high number of enterprises operating in the United States. The industry’s largest companies carry vast product offerings aimed at appealing to the needs of any consumer. Product ranges generally vary from universal parts and components to specialty accessories fit for a specific vehicle make and model.
The remaining smaller firms in the industry compete at a niche level, catering to consumers with specific or unique performance parts that are generally not found at larger, generic online automotive parts retailers. Nevertheless, over the past five years, some heavy merger and acquisition activity has added to the industry’s concentration level. Over the next fi ve years, IBISWorld expects industry concentration to grow as the industry’s largest fi rms continue to acquire specialty retailers.