WHY SHOULD YOU READ an article about Motorcycle Superstore? Because it posted $43 million in online revenue in 2008, and enjoyed double-digit growth in 2009 while the rest of the powersports retail industry was starting to struggle? Because it gets high approval ratings from 150,000 customers on Shopzilla/BizRate? Or perhaps it’s because you believe Superstore and other online retailers are siphoning away your in-store business?
The most important reason to read up on Don Becklin and Motorcycle Superstore may be because his (and other e-tailer’s) business is just as much a part of the retail channel as the 30-year-old brick-and-mortar dealership. Complain about them all you want, but online retailers aren’t going away — and if you want to stay in business, you’d better learn how to compete against them.
It may seem simplistic to consider Superstore a PG&A retailer that sells through a new sales channel to a much wider (actually, global) customer base. But Superstore carries the same brands as traditional dealerships and orders from the same distributors and vendors. Becklin worries over stocking, inventory, marketing, advertising, employee morale and productivity, and keeping customer satisfaction scores as high as possible. He may not have a newsletter, but he does run www.motorcycle-usa.com.
In short, he’s doing everything you’re doing, only on a larger and grander scale.
In an exclusive interview with Dealernews, Becklin says there’s a huge misconception about the role a company like Superstore plays in powersports retailing, and it has to do with the customer conversion rate. Superstore’s volume is gargantuan, but most people visiting the site don’t buy anything.
Here’s evidence: In April, the Superstore website hosted 1.5 million unique visitors and nearly 6 million page views. If Superstore’s sales conversion rate is about 3 percent, as Becklin states (versus about 30 percent for a traditional brick-and-mortar retailer), 97 percent of visitors (1.45 million) leave the site without ever clicking the “buy” button.
What does this mean? According to Becklin, it’s due to the same reason consumers go online to research the particulars of, say, a new home theater system before venturing to their local Best Buy to purchase it. Superstore, he says, is a research tool for visitors who want to investigate and compare products before buying them elsewhere.
It’s this point that Becklin believes gets lost in the online-vs.-brick-and-mortar argument. “Consumers are still doing an awful lot of shopping locally, but the Internet, first and foremost, is a great research tool,” he says. The Internet has empowered consumers to make purchase decisions based on their priorities. “The consumer is in control,” Becklin notes. “If a consumer is browsing my website on a Friday and is going riding on Saturday or Sunday, guess what? Whatever he needs, he’s not going to buy from me because there’s no conceivable way I can get it to him. If he’s gathering information, he can become informed. And if he needs it right then, he’s going to go someplace and make that purchase, and traditionally that’s going to be a local dealership.”
Becklin says consumers will buy from Superstore and other e-tailers when it makes sense for them to do so — for example, if they have the time to wait for their product to ship. So it’s this very point — along with the fact that an e-tailer never has face-to-face interaction with its customers — that gives traditional retailers an advantage over online stores, he says. (continued)