With the advent of the Internet, it's now entirely possible to create an online retail store using niche marketing and have the world beat a path to your "virtual" door. Leader Industries made such a discovery and radically altered their business model by creating two such websites with The Fiero Store and T.A.S. Auto Parts, the latter specializing in 1994 to 2002 Honda Accords.
"It kind of happened by accident and then snowballed," explains Matthew Hartzog, T.A.S. Auto Parts' vice president of marketing. "The owner's son dabbled in computers, so they threw the catalog up on the Internet, and the calls started rolling in."
The Fiero Store now represents a multi-million dollar market, partly because of their outreach efforts. "Around the mid-'90s, about the time I came onboard," says Hartzog, "we were going with a pretty aggressive direct mail campaign to a lot of clubs, which really shot us past anywhere where we'd thought we'd end up. We cooperate a lot with these clubs all over the world, and that seems to be one of the cornerstones of our marketing success."
He tells us they have a certain segment dedicated to performance, another to restoration, but most of the hard work in establishing this market has been done through working with these clubs. "The challenge with Fiero now is not so much marketing but product development. In the Fiero world, if you don't innovate, you die."
Search engines bring valuable businessAfter becoming the largest supplier of Fiero parts in the world, Leader Industries decided to try a bigger market. "With the Accord it's like night and day," comments Hartzog. "We couldn't build off of anything we had done with the Fiero market; we had to start pretty much from scratch, and that was really fun to be honest with you." With a more saturated market (there are more Accords in Texas and Florida than there are Fieros in the world), Leader Industries found that search engine marketing has been successful. They bid on key words, so when someone types in Accord parts or Accord performance, their name appears near the top.
"The key is to gather as much data as you can, do as much homework as possible," says Hartzog. "We gather data from our website, from our advertising...and the marketing plan gets tweaked as we go. While the Fiero company is quite mature, our Accord business is still in that rapid growth phase of its lifecycle."
They believe one of the keys to making customers happy is to make the parts easy to find. They break the site down into categories, so it's easy to look up everything from cable, clutches and cooling to electrical, engine pieces and exhaust. "We specialize in the things that aren't necessarily industries unto themselves."
To stay competitive in a market dominated by big WDs, Hartzog says they focus on service and innovation. They break their Accord market into two segments, daily drivers and "stylers," the latter a very fickle marketplace. "I'll use lighting as an example," he explains. "In the three years we've been in business, our lighting product mix has probably changed five or 10 times. These things change almost on a monthly basis," so they hired someone who does nothing but analyze this market.
"We have depth instead of breadth," Hartzog says. "You have to come up with services and products (the other companies) don't have. We're actually in the process of doing a complete ground-up overhaul of our Fiero and Accord Internet sites to give them all kinds of new functionalities, new features, better account maintenance online. If you're going to play with the big boys, you've got to stay on your toes."