“Industry Perspective” by Russ Carter
Five years ago, when I was working in retail, if you had asked me, “Should I post my tire prices on my website?” I can guarantee, without a second thought, my answer would have been a definite, “No!”
I was of the mindset that no one shops for tires on the internet.
That mindset was challenged however after attending multiple twenty-group meetings and listening to my peers share their successes of publishing their tire prices online.
So, as we do in the tire and auto service industry, we try things out that we never imagined that we would do. We decided to listen to our peers and put our tire prices on our website for a limited time to test the effect.
I was still skeptical and was determined to prove to everyone that this would not work!
To prove that posting tire prices online was a bad decision, I made up my mind to carefully track online inquiries that led to sales. I would then compare those numbers to our previous method that utilized the “Get Quote” button when a customer wanted to inquire about tire pricing from our website.
So with each request that came in for tires from our website, I was copied by email. Each week those inquiries increased. The emails where loading up my inbox. Surely all these inquiries would not convert into sales!?!
Boy, was I wrong! We found that 90% of requests that came in online for tires converted to sales at one of our locations. This was up from a roughly 50% conversion rate when we simply had a “Get Quote” button on our website.
We found that by the time the customer sent in an online request for tires, since they had already seen the price, they had already made a purchase decision. This allowed our salesreps to focus on actual customers, not just tire kickers shopping around. This made us more efficient because the time we spent to follow up with online inquiries were translated into actual sales.
So it made sense that our conversion rate was up, but what about our volume?
Well initially, it certainly seemed like we were selling more online and after time, the data proved it. From the beginning, our internet tire sales averaged an increase of nearly 15% year after year; a stat that we could not walk away from when we made the decision that online tire pricing was here to stay in our business!
All those great stats being noted, it is not enough to simply put your prices online. There are some other things to consider and I would submit that the follow-through on how you implement this strategy is just as important as the decision to do it. Here are some things to consider…
1. We were always competitive but didn’t worry about being the cheapest. We used internal research and competitor monitoring to set our prices.
2. To satisfy the customers looking for the “cheapest” tire, we offered a Price Match Guarantee. This prevented us from needing to mark our tires down to be the cheapest.
3. We had one price for both internet and walk-in customers. This kept things simple internally and guaranteed our most valuable return customers received the same price as a new online customer.
4. In our business, tires were an acquisition tool that allows us to gain a customer for life. Tires brought customers in the door which allowed us to “WOW” them with our customer experience and gain them as a customer for life for all of their auto service needs.
Of course that was our business model. If your business model is 70% or more tires, obviously GP needs to be made on tire volume.
If you were like I was, and are hesitant about putting prices online, I suggest giving it a try. If you are not in the game of posting your tire prices on your website, you are missing that customer that has possibly never been in your store and is searching your competition’s websites for tires.
I’m a believer that no matter the market you are in, if you post tire prices on your website and make it easy for the consumer, you will see more customers and have increased tire sales.
Russ Carter has served the tire and auto service industry for 30+ years. Russ began his career with a regional tire wholesaler and transitioned to General Manager for a 10 location retail and commercial tire and auto service center before joining Andreoli Software.
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