Poor Telephone Skills Hand e-Tailers Opportunity - Tire Review Magazine

Poor Telephone Skills Hand e-Tailers Opportunity

(Staffordshire, U.K./Tyres & Accessories) The idea of an online tyre replacement market might sound like a less-than-significant niche to you, but when you consider that the UK and Germany are not only the most “wired,” but also the two of the continent’s largest tyre markets, it is clear that this means a lot of tyres and potentially a lot of money.

The total online shopping market is currently worth £21 billion and is expected to triple in the years to come. As far as tyres are concerned, the leading online players are banking on the increase in broadband availability bringing extra customers organically, but one report Tyres & Accessories has seen suggests the poor communications skills of some conventional businesses are handing e-tailers even more opportunities.

According to leading European online tyre business, Delticom AG, its tyre e-tailing has only just begun to scratch the surface with a pan-European market share of 1.5 per cent. In the UK, it is 1 per cent, with Delticom estimating it holds a 1.8 per cent of the market in Germany. However, these estimates do not show the total size of the market. Detailed consumer research conducted by market analysts at GfK shows that online purchasing accounted for three per cent of the retail market in 2006. And, the strong sales growth of companies such as Blackcircles and Delticom (see separate articles) suggests that this trend is set to continue. Delticom alone, for example, reports that it gained 490,000 new customers in 2006 bringing its total to more than 1.2 million.

The striking thing about the GfK data is that, quite apart from revealing that the online tyre market could be much bigger that first thought, customers are incredibly dissatisfied with the telephone service they receive at retail outlets. And perhaps this, rather than encouraging consumers to continue to buy from dealers, is actually pushing them towards virtually shopping where they only have to spend the minimum of time (and money) dealing with a “real” person.

From a sample of 2,539 tyre purchases made during 2006, 46 per cent phoned before arriving at the retailer, three per cent more than in the 2005. It is not clear whether this is due to increased tyre knowledge or awareness amongst consumers or whether there was another cause, but the level of dissatisfaction with the service received is overwhelming. 95 per cent said they were either very dissatisfied or dissatisfied with the telephone service they received. Worse still, only one per cent said they were quite satisfied, with the remainder somewhere between.

In recent years, the retail business has taken real steps to up the tempo and improve its service. Recent examples such as the overhaul of the Hi-Q network and Stapleton’s STS Tyrepros network are the embodiment of this consultative approach, but judging from data like this, something has to be done to retain the consumers that are gaining increased access to alternatives, not least online retailing.

Make your own e-shop

The concept of a bolt-on retail front-end that could be easily added onto a retailer’s Web page, coupled with local conventional press advertising and online marketing, is something that has figured as part of Tyres & Accessories’ previous e-commerce coverage. Last year’s feature gave details of how some of the largest manufacturers have been developing consumer-facing sales engines for independent businesses to use to sell tyres to the public through the Internet. A year later, it is clear that those projects are still underway, and other large players have got onboard developing their own versions. But none of them is prepare to make any details public at this stage, as they are biding their time before releasing these concepts into the market.

During the course of researching this article, T&A came across some horror stories of how some conventional retailers have been venturing into this domain themselves, selling tyres at low prices with even slimmer margins. The benefit of using a system that is linked to particular wholesalers and/or manufacturers is that “the received wisdom” of how much an online tyre could cost (not to mention the average online price) could modulate upwards, to the benefit of retailers and wholesalers alike. The logic is that if a large number of retailers are advertising at comparable prices, consumers will be more comfortable paying higher, and may even distrust prices they perceive to be too low.

In the meantime, numerous new online tyre retailers have stepped into the market. They range from large-scale professional operations (usually offshoots from existing businesses) to small-scale, home-run enterprises that aim to emulate the entrepreneurial success of people like Blackcircles’ Mike Welch. Tyres & Accessories compiled the following list of some of the e-shops we have not previously profiled:

Tyre-shopper.co.uk

Tyre-shopper is a trading name of Constant Price Monitor Ltd, which was established in 1994, but is closely related to National Tyres & Autocare, claiming a fitting network of more than 1,000 outlets across the country, including many National outlets. The site’s price-comparison page pitches its premium brand pricing policy directly at the likes of blackcircles.com, mytyres.co.uk, etyres.co.uk and valuetyres.co.uk. (As an interesting aside, something you may not know is that Axle Group Holdings MD and National Tyres Boss, Alan Revie, holds a 1.49 per cent share holding in Delticom AG and sits on the supervisory board of the company behind mytyres.co.uk.) Back on the subject of selling, tyre-shopper uses a sophisticated registration plate-based database to ease tyre selection and offers consumers Tesco Clubcard points as a unique selling point.

Tyresonline.net

Birmingham-based tyresonline.net has been selling tyres through its Web site since September 2002 and has grown into a national supplier direct to retail customers, and business-to-business operation locally to the Birmingham tyre trade. In addition to the passenger car and motorcycle tyres it focuses on, the Web site also promotes Autosock winter driving aids.

Event-tyres.co.uk

Event Mobile Tyres was formed in 2003 by Gary Moloney and Mark Shankland. With more than 50 years of experience in the tyre industry, the company’s Web site says it has constant access to thousands of tyre products “both in our own huge tyre stocks as well as guaranteed same-day and next-day delivery to us from our tyre suppliers…We have “live” online links to many of these tyre suppliers, so you can check availability and price instantly.” Brands sold include Uniroyal, Kleber and Federal, in addition to all the best-known premium brands.

Valuetyres.co.uk

Claiming to be one of the largest independent online tyre retailers in the UK, valuetyres.co.uk sees its buying power as its strength. The company has access to more than 50,000 tyre items at any one time. A selection of current brands includes Avon, Marshal, Matador, and Fate tyres.

Pneus-online.co.uk

Pneus-online, a French company founded in April 2001, by IT consultant, Alexis Nerguisian entered the UK market in October 2005 and has since opened stores in Spain and Germany. From 600 tyres sold in 2002 to 100,000 estimated pieces in 2006, turnover has increased by 150 per cent the last two years. What started as a small business has grown into a dynamic international company, run by a young, dynamic and at least trilingual team – the staff speak French, English, German, Spanish, Portuguese and Italian. The team is currently made up of 11 people based at the headquarters in Dardilly (Lyon), but the team is expected to double by 2008. Pneus-Online already works with vehicle dealerships under the Harley Davidson, Porsche, BMW and Peugeot monikers. And, in addition, the company claims to have become the first in Europe to launch a 24-month insurance cover for flat tyres.

Then, there are easityre.com and roadtyres.com to name just two more. The list goes on…

E-commerce software specialist Actinic’s latest annual survey shows that 90 per cent of small- and medium-sized company Web sites are profitable. On average, companies that implement e-commerce find it costs 40 per cent less than they anticipated. But, only one in 10 retailers has a transactional Web site. Even amongst those who already accept telephone orders for home delivery, only one in four have an e-commerce facility. So why not make your own e-shop, or team up with someone else who can help you to do this?

You May Also Like

Continental’s ContiConnect Lite to allow digital tire management for OTR tires

Continental said ContiConnect Lite helps fleet managers monitor the condition of their tires via bluetooth.

ContiConnect-Lite-OTR

Continental launched ContiConnect Lite, a new version of its digital tire management app, which the company said creates a bridge between tire sensors and professional tire management and offers a free-of-charge gateway to selected ContiConnect features. Continental said it can also now be used on tires with an integrated Gen2 sensor. Since this year, Continental has been delivering its off-the-road (OTR) radial tires with a bluetooth-enabled sensor. In addition to OTR tires, Continental said it also offers digital tire management to its truck tire customers.

Hana Technologies signs license agreement with Michelin for RFID tire tags

Since its inception, Hana Technologies has spearheaded the manufacturing of over 150 million RFID tire tags.

Handshake agreement
Continental debuts new sustainably-focused U.S. headquarters in South Carolina

The building’s 840 solar panels are capable of offsetting up to 25% of its total energy consumption.

Front-of-Continental-Americas-HQ-1400
Yokohama Rubber reveals 2024 motorsports activity plan

Yokohama said participation in motorsports activities is crucial to its efforts to strengthen the Advan and GeoLandar brands.

Yokohama-Nitrocross
Tesla Model 3 TPMS service

Resetting and programming TPMS sensors for a Tesla is a lot like any other vehicle, and the challenge is still the same: keeping the light off.

bendpakEVgarageTPMS-1400

Other Posts

TIA’s Advanced Farm Tire Service training to take place in June

The training class for technicians in the agricultural and farm tire industries is set to take place June 11-14.

TIA_training-
Three spark plug service and replacement tips

How to avoid and overcome roadblocks that may come up during the removal or installation of spark plugs.

Continental-sparkplug
Maxxis-sponsored athletes make podium, overall top 10 at Mint 400

Maxxis athletes Michael McFayden, Ethan Ebert and Trey Gibbs had podium finishes at the Mint 400 on Maxxis RAZR XT tires.

2024-mint400-maxxis
Sun Auto Tire reveals winner of Ford Bronco Sport giveaway

Lowell Anderson entered the giveaway at his local Sun Auto Tire & Service store while receiving a routine oil change.

Sun-Auto-Bronco-giveaway