Goodyear seems to have prompted a real game changer with its decision earlier this year to begin selling tires directly to customers via the Web.
The tire maker's shift to greater use of online tire retailingwith certified installers getting paid for mounting and balancing the productshas begun to filter down to other tire makers and marketers.
Since Goodyear's announcement, two other companiesSingapore-based Omni United Pte. Ltd. and Group Michelinhave revealed plans to tap into the direct-to-consumer arena.
Omni United has launched an e-commerce direct-to-consumer site and installer network for its new Timberland tire brand, while Michelin has jumped into direct-to-consumer retailing in France by buying a 40-percent share in French Internet tire retailer Allopneus S.A.S.
Michelin said the deal will allow it to expand its online range and extend its commercial presence.
This effort toward more direct-to-consumer online retailing represents what very well could turn into a seismic shift in how tires are bought and installed in the futurewith dealers agreeing to mount customers' tires for a pre-set fee and mounting/balancing charge. It's a fast-moving scenario that independent dealers should take seriously and watch closely.
The growth of online tire retailing differs from earlier eras, when change meant a new type of bricks--and-mortar competitor, such as when mass merchandisers began offering tire sales and service or franchise car dealerships started peddling tires more aggressively in their outlets.
Yes, the growth of these two retail-tire channels affected tire sales and service, but their impact on independent tire dealerships remained somewhat limited. Car tire sales made through mass merchandisers, such as Wal-Mart Stores Inc., and wholesale clubs, such as BJ's Wholesale, for example, account for only about 13 percent of replacement passenger tire shipments in the U.S., according to 2014 Rubber Manufacturers Association data.
For car dealerships, service stations and garages, their marketshare is 6 percent.
Meanwhile, the share of replacement passenger tires shipped from tire makers to independent tire dealershipslocal, regional and nationalhas held steady for decades at roughly 65 to 69 percent.
But the move to direct online sales is a different trend. It's a cultural shift in how peopleespecially Millennialsprefer to shop and buy goods and services.
Michelin has taken notice. In announcing its purchase of Allopneus, it said three out of four consumers in France research tire information online, while 13 percent make their actual purchase online.
When considering online usage by younger generations, those percentages are only going to grow. It's why the world's largest tire makers are moving quickly to tap into this trend and why dealers must too, lest they be caught on the outside looking in.