Partnerships Enable Online Sales of Auto Parts to ‘Do it For Me’ Customers

It’s difficult to sell auto parts online if shoppers can’t install them themselves.

Seeing an opportunity to serve these customers, eCommerce platform PARTS iD began partnering with tire shops that would install the tires it sells.

Previously, the company had primarily sold automotive parts and accessories to do-it-yourselfers. With the new partnerships, it can now also sell tires to customers who would prefer to have a professional installer “do it for me.”

Building an Omnichannel Experience

The company announced April 19 that it added 5,000 new locations to its tire installation network in the first quarter, bringing the total number of participating installers to more than 7,000.

“To complement our existing strength in the DIY segment, we continue to build an omnichannel customer experience to attract customers in the $225 billion-plus do-it-for-me customer segment of the industry,” PARTS iD CEO Nino Ciappina said during the Tuesday (May 10) quarterly earnings call.

The installation network bolsters the company’s growing range of repair and service parts, which it offers along with performance parts and accessories.

“This enriches the shopping experience for tires,” Ciappina said. “In addition, we’re now in a position to expand this initiative to categories beyond tires.”

Enabling Customers to Trade Down the Value Spectrum

During the call, Ciappina also outlined challenges that may impact the sale of products for vehicles. He noted that consumer spending for accessories had been impacted by widespread inflation and a delayed issuance of income tax refunds, which historically have benefited the company’s performance early in the year.

Compared to the first quarter of last year, PARTS iD’s net revenue was down 13%. Ciappina attributed this in part to the fact that in the first quarter of 2021, a record amount of government stimulus fueled outsized consumer discretionary spending. Compared to the “more normal” first quarter of 2020, revenue was up 34%, Ciappina said.

For customers who may be hesitant to buy because of rising prices, PARTS iD’s platform and call center representatives have been offering lower-priced options. Ciappina said the company’s just-in-time inventory model, with more than 1,000 integrated vendors, enables it to offer shoppers a broad range of choices.

“One notable and clear advantage of our platform business model is the breadth of similar products available to a consumer to trade down the product value spectrum as prices increase,” Ciappina said. “By offering customers options down the value spectrum during times like this, we can capture sales which competitors with a stock-and-ship only model may lose due to their limited product assortment and options.”

Anticipating Results Similar to the Pre-Pandemic Period

Looking ahead, Ciappina said the macro environment remains dynamic and difficult to predict. The first quarter presented the same inflationary pressures and supply chain challenges as the previous quarter. Still, the company believes that interest and demand in the automotive aftermarket remains healthy.

To meet the demand, PARTS iD is continuing to add more repair parts as well as products for the seven other adjacent verticals the company serves, including boats, motorcycles and powersports.

“As we move forward,” Ciappina said, “we’re planning for revenue trends that more closely mirror the pre-pandemic period but overlaid with adjustments for the change in product mix to account for stronger demand this year from repair products right now.”