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E-commerce orders, revenues increase in ‘11

Dave McMahon, Senior Editor
January 23, 2012
Filed under Features

Data shows bricks and clicks dealerships have rising online sales

Data presented to Powersports Business from 50 Below shows that powersports dealerships are taking advantage of their online opportunities. Both orders placed and revenue earned from e-commerce increased in September/October 2011 compared to the same two months in 2010.

Dealers at the 2011 Profit Xcelerator, Powersports Business’ conference and expo in Las Vegas, learned from 50 Below staffers how to use e-commerce as an additional revenue stream.

A data sample from dealers who use 50 Below as an e-commerce provider shows that bricks/clicks dealers averaged about $505,000 in e-commerce total sales in the first three quarters of 2011. The e-retailer average for the same period was about $998,000. The sample total was $3.14 million in sales for the first three quarters of 2011.

In Q1, e-retailers chalked up $1 million in sales, compared to bricks/clicks dealers, which had about $650,000 in sales.

In Q2, e-retailers had increased their sales to $1.1 million, compared to $500,000 in sales for bricks/clicks dealerships.

In Q3, e-retailers saw their sales dip to $850,000 and bricks/clicks dealers dropped to $300,000.

E-commerce Sales (Click image to view larger)

“Consumers are becoming more comfortable buying online,” 50 Below product manager Doran Nurmi said. “First they were buying computers, then other electronics. Now consumers are more likely to purchase a jacket online or a set of replacement parts online.”

One of the best ways for a dealership to engage customers online, Nurmi says, is to include a search bar on its website.

“About 80 percent of consumers attempting to buy something online use the search bar on dealer sites,” Nurmi said.

With that feature in mind, dealers at ProfitX were able to see the benefits of 50 Below’s EZ-Shop Instant, a 2011 Powersports Business Nifty 50 award winner.

How much could your dealership be missing in online sales?

“Some of the most trafficked sites are getting $3.50 on average from every visitor that comes to the site,” Nurmi said. “The average is about $1 for every person that goes to the site. So some guys are making $3 per name.”

E-commerce Orders (Click image to view larger)

A rise in orders
Over a two-month period in 2011, both e-retailers and bricks/clicks saw an increase in e-commerce orders compared to 2010, the 50 Below data shows.

For the months of September and October combined, e-retailers saw their same-store orders rise from about 2,600 orders for the two months in 2010 to nearly 3,500 in 2011.

Bricks/clicks stores, meanwhile, went from about 1,600 orders in September and October 2010 to more than 2,100 orders in 2011 for the same two months.

In 2010, the sample total was 4,311 orders. The e-retailer average for the two months in 2010 was 269 orders, while the bricks/clicks store averaged 162 orders.

In 2011, bricks/clicks jumped to 212 orders on average for the two-month period, while e-retailer orders decreased slightly for the same two-month period to 257 orders on average.

E-commerce Revenue (Click image to view larger)

Revenue up for bricks/clicks
E-commerce revenue for September and October for e-retailers was nearly $390,000 in both 2010 and 2011.

Bricks/clicks, however, had much higher revenues in September/October 2011 compared to the same months in 2010. In fact, bricks/clicks saw a 32.3 percent increase in sales over the two time periods. Bricks/clicks had about $250,000 in e-commerce revenue in September/October 2010, but that number jumped to more than $330,000 in September/October 2011.

The sample total in September/October 2010 was about $638,000 in e-commerce revenue. The e-retailer average for the same time was about $38,500, and the bricks/clicks average was about $25,000.

In September/October 2011, the sample total was about $720,000 in e-commerce revenue. The e-retailer average was $38,600, and the bricks/clicks average was $33,300.

About the data
The data was collected by 50 Below as a sample to represent two types of business categories: “e-retailers” and “bricks and clicks.” E-retailers refer to those who only run an online store; they do not have a physical location and do not showcase vehicles on their sites. Bricks/clicks refer to those who do have a business location in addition to their online store, and also showcase vehicles on their sites.

Dealers were selected at random from a list of 50 Below’s top 100 dealers, based on visitor traffic to the site. Dealers were segmented into the categories of “e-retailers” vs. “bricks and clicks.” Dealers who had not been with 50 Below for at least 18 months were removed from the list. Ten e-retailers and 10 bricks/clicks dealers were used to compile the sample. Every one of the dealers is in the top 10 percent of 50 Below sites for traffic.

The average monthly visitors for 2011 are as follows for the two dealer sample groups:

E-retailer: 119,749 unique views per month
Bricks/clicks: 73,788 unique visitors per month

A unique visitor is each unique computer that has connected to a website. A visitor can come back any number of times and still counts as one visitor if he or she is connecting from the same computer each time.

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