
While there may have been an initial push for consumers to choose private label options for their automotive aftermarket needs, it appears the area isn’t growing.
Nathan Shipley, executive director of industry analysis in automotive at Circana, showed data from the last three years and it all suggested that numbers are flat in this area.
“But there’s not some major shift to private label like I think a lot of us would expect as we have gotten into a little bit tougher economic times this year,” he said at AAPEX 2023 during his session, Aftermarket Outlook 2024.
A low-income consumer was more likely to opt for private labels more often than a higher-income one. Private labels made up 50 per cent of their purchases.
“So [there is a need out there] for branded offerings and not discounting having premium products targeting that higher income consumer,” Shipley said.
Shipley had previously noted that it was the higher-income consumer who was frequenting the aftermarket more often. Retailers, he said, need to account for that when thinking about their product offerings.
That said, consumers are finding sticker shock, such as with tires. It’s something that they buy every several years. But when they spent $1,000 five years ago and are seeing prices about 50 per cent higher now, they’re taken aback.
“So that starts to influence decision-making as it relates to what you’re going to buy,” Shipley pointed out.
Supplier promotions starting to come back, though. After a few years of no or very few of them offering promotions on their products, the mood is shifting.
“We’re starting to see that lever get pulled as a way to drive demand,” he said. “For the first time this year, we’re to a level higher than we’ve been the last four years at this point in time. So I think that’s just an interesting observation.”
Leave a Reply