Auto Care Demand Index provides product line insight

Aug. 26, 2019
The Auto Care Association (ACA) has launched a new Demand Index, which will help aftermarket companies view product category performance trends, including monthly demand of automotive aftermarket product lines in the United States.    

The Auto Care Association (ACA) has launched a new Demand Index, which will help aftermarket companies view product category performance trends, including monthly demand of automotive aftermarket product lines in the United States.

According to the ACA, the data can provide insight into how companies are performing against the market, and an accurate view of potential product opportunities to enable strategic decision making.

The Demand Index is housed within Auto Care Association’s new platform for interactive data, the Auto Care TrendLens. According to ACA, TrendLens will expand in the near future to include data and trend information focused on providing additional data and insights.

“At the Auto Care Association, we focus on delivering value to our members, and one big need they have is for data and insight,” says Behzad Rassuli, senior vice president, strategic development, Auto Care Association. “We have traditionally published that type of information, but what we hear from members is that while that data is useful, it is static because it is in a printed report.”

Rassuli says the organization has invested in creating a market intelligence analytics platform so that ACA can provide dynamic market data in a digital platform that is interactive. The result was TrendLens.

“We then identified a major gap in data in our industry around hard part product line performance,” Rassuli says. “For years, the industry has been without visibility into how hard part products are performing, in the category management arena specifically. We invested time and money to get our retailer and wholesaler member to provide point of sale data on hard part products.”

The Demand Index then aggregates that data and reports it back to those members and other manufacturers. “We worked with our members to come to an understanding that there is a collective benefit for everyone to report that data, that they otherwise might be hesitant to expose,” Rassuli says. “

The Demand Index is based on anonymized, unit-level point-of-sale (POS) transaction data for 15 product lines from a “comprehensive list of retail and commercial distribution businesses representing more than 80 percent of hard parts transactions,” according to ACA. Users can view custom date ranges of data, examine points by hovering with their cursor, overlay categories, export or securely import data to compare with their own business performance figures.

Product lines currently covered in the Demand Index include:

  • Brake Calipers
  • Brake Friction (Pads and Shoes)
  • Brake Steel (Drums and Rotors)
  • Charging Systems
  • Chassis Suspension
  • Engine Management Sensors
  • Fuel Pumps
  • Gaskets
  • Hoses and Belts
  • Ignition Components
  • Radiators
  • Ride Control Suspension
  • Starting Systems 
  • Water Pumps
  • Wheel Bearings and Seals

The ACA worked with leading retailers and distributors to get the POS data needed to generate the information in the index, including Advance Auto Parts, the Alliance, the Automotive Distribution Network, AutoZone, Bridgestone, Federated Auto Parts, NAPA, Pronto, O’Reilly and Pep Boys.

“They send us the POS transaction data, and we normalize and anonymize that data,” Rassuli says. “It shows users of the tool on a monthly basis whether a product category has gone up or down, and by what percentage.”

The comparative function of the Index will be valuable, Rassuli says, because in the past companies often had few ways to compare their own performance against the industry as a whole. “You can look at your own business and see that you are 3 percent down in a category, but you don’t really know if that is good or bad,” he says. “With the Demand Index, you could see that the market is down 8 percent overall, and that you are actually beating the market by a significant margin. Without that visibility, you don’t know how you are performing relative to the broader category.”

The companies that are contributing data to the Index are already using the tool, and it is available to manufacturers of products covered in the Index that sell through those data contributors.

Potential users have to apply for access. Pricing for the index is based on a 12-month subscription: $5,000 per category, per year for members, and $15,000 per category, per year for non-numbers. Users must be validated and approved as a part supplier within the category they wish to purchase in order to gain access.

“The Demand Index is to help manufacturers and retailers understand performance of products and see how they can improve in those categories,” Rassuli says. “And it’s all presented in real time. Our members are using this in their internal discussions and to do line reviews with trading partners. It is much more impactful because they are talking about eh same trends with the same real data.”

Rassuli says that in the long term, the organization plans to expand the number of product lines in the Index, as well as potentially expand into Canada or the heavy duty market.

“We want to give our members the opportunity to not just look at product line performance, but to correlate that with market factors such as vehicle miles traveled,” Rassuli says. “They can spend their time coming up with strategies and making decisions, rather than searching for data.”

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