Over recent days, the news has been full of reports on how online sales have surged 10 to 20% over the last year. Ok, sales volumes are already great, but it is predicted that it might be another 3 or 4 years before online sales start decimating sizable sections of the bricks and mortar retail trade .
So why is Tyresales lavishing so much time and effort in the online tyre market years before it attains full strength? Well, firstly, online tyre sales are already worthwhile and they are constantly increasing. But we also want to establish our business and its reputation in the early days of the online tyre market and develop it in tandem with the markets expansion. By the time the market starts moving serious numbers in 3, 4 or 5 years, we will have a well established and proven business and have a strong customer base. And one thing we are noticing is that Tyresales customers are often repeat customers; our online store is growing a base of loyal repeat customers just like a good conventional retailer does.
Yes, I guess we could just sit back and do nothing, forgo our current internet sales and just wait and see how online tyre wholesaling develops. But we would end up arriving in the market far too late. And that’s just what will happen to all the “online tyre market deniers”, they cannot or will not admit its existence while at the same time constantly complaining of the great online tyre bogey which is affecting their businesses. And we know for a fact that content is king; constantly updated websites with a long history invariably rank higher in Google searches. So we are using the next 3 to 5 years to maximise our internet presence. To start doing this in 4 years time would be too little, too late.
No one knows for sure how this will end up; just maybe the folks who say the online tyre market will never be significant will be proven correct, but I predict that online tyresales will account for 20 to 30 % of the total market within 5 years. That’s a whole lot of tyres; overseas trends and even various categories in New Zealand indicate this is highly possible.
There will be no huge profit margins in internet sales, the most efficient websites with super low costs and prices are likely to dominate; once again, Tyresales is using the next 3 to 5 years to drive costs out of our business and distribution model. We developed our automated e.commerce website ourselves for free and have overheads of only $25.00 per month, so we are basically developing a competitive business with zero overheads.
e.commerce is exciting!