Car parts on a white background

Leveraging OEM Parts: A Growth Opportunity

Michael Jennings headshot

by Michael Jennings

Senior Vice President

As more consumers choose to keep their cars longer rather than buy new ones, competition in the automotive industry has intensified, driving companies to seek innovative ways to expand and enhance brand growth by meeting and surpassing consumer needs. An often underappreciated opportunity lies in ensuring that your customers prioritize Original Equipment Manufacturer (OEM) parts over other options such as purchasing used or aftermarket parts.

 

Why is it important to think about OEM parts?

As the average price of a new vehicle continues to rise and with consumers being more sensitive to price and inflation pressures, they are holding onto their vehicles for longer periods of time. It is often less expensive to repair or replace existing vehicles than to purchase new ones.

I see this as an opportunity for OEM parts manufacturers (parts produced by or for the original manufacturer of a vehicle). These parts are designed to fit and function perfectly with specific vehicle models. Unlike aftermarket parts, which are produced by third-party companies and increasingly by low-cost, unproven shops, OEM parts guarantee compatibility and reliability. For OEM manufacturers and those supporting these companies, positioning OEM parts as a must-have in the marketplace is critical and can lead to substantial business growth.

 

Mechanic and customer in an auto repair shop

For OEM manufacturers and those supporting these companies, positioning OEM parts as a must-have in the marketplace is critical and can lead to substantial business growth.”

 

Where to start with OEM parts?

At Radius, we recommend first conducting consumer research to understand needs before committing scarce resources to specific parts issues. For example, Ford conducted extensive market research before launching its OEM parts e-commerce platform. By understanding customer preferences for online shopping and the types of parts in high demand, Ford was able to design a user-friendly platform that significantly increased its OEM parts sales.

Specifically, we recommend understanding consumer attitudes and behavior when it comes to their decisions and how we can use these insights to mold marketing and communications strategy. Questions we seek to answer with such an initiative include:

  • What is the path taken for information gathering (e.g., dealer first, online research, local repair/parts shop)? Where should this information come from? Who do they trust? This helps drive key touchpoint analysis.
  • How is the decision made/at what point is it made in terms of buying a new/newer vehicle vs. repairing or replacing a current vehicle? What information best impacts and influences all key decision makers?
  • And if repair/replace, how and where will that be done (dealer, local service shop, DIY)?
  • Are parts discussed and what parts will be used (upgraded, used, new aftermarket, OEM)?

Decision pathway research will inform your business strategy in terms of when it’s optimal to provide necessary information, what that information should be, and how to leverage your operations, sales, and marketing to grow in this area.

 

Contact us to learn more about how Radius can help with your brand growth.

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