Around 6.9 million passenger cars were sold to customers in the U.S. in 2016, and approximately four million cars were produced in the same year.
The global car accessories market is primarily driven by the increasing demand for cars, increasing inclination toward vehicle customizations, and growing sales of pickup trucks in developed markets. Moreover, leading players in the car accessories market are increasing their focus on implementing new technologies like biometric access, active window displays, and advanced lighting technology. Such technological advancements are anticipated to fuel the growth opportunities of the car accessories market in the coming years. Furthermore, leading firms specializing in manufacturing car accessories are investing in product innovation, technology, and are maintaining quality standards to retain their foothold in the automotive industry space.
Here are a few factors limiting the growth of the global car accessories market:
- Cost: One of the major factors limiting the market growth for car accessories is the cost of high-quality car accessories. This is typically attributed to the costs associated with the implementation of advanced technologies. Many such factors are compelling players in this sector to manufacture low-quality car parts, resulting in weak market growth, thereby, decreasing the revenue share of the organized players.
- Personal transportation: Though connected and intelligent cars have just started making inroads into the global automotive industry and have already impacted the performance of car accessories manufacturers at an organizational level. The technology required to build smart cars such as sensors, web networking, and software is leading to the rise in the presence of technology multinationals in the automotive industry.
Several such factors are compelling firms in the car accessories space to leverage the use of market segmentation solutions. Market segmentation solutions aid firms to identify the potential market opportunities. These solutions also help firms create separate marketing programs designed to satisfy the needs of different customers.
The Business Challenge
- The client: A leading car accessories supplier
The client, a leading car accessories supplier with business units spread across the globe, wanted to maximize their profitability by focusing their efforts and resources on developing strategies to match the target market segments. Additionally, they wanted to create sub-segments of the market based on various factors which included priorities, demographics, and psychographic criteria used to better understand the target audience. This would help them offer personalized services to their diverse customer segments.
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The market segmentation experts at Infiniti also carried out extensive research comprising interviews and discussions with prominent stakeholders in the car accessories industry space to help the client identify the potential targets and implement a robust market segmentation strategy. The experts also compiled information from a wide array of reliable sources such as paid industry databases, industry forums, and company presentations.
The Solution and the Business Impact
Infiniti’s market segmentation solution helped the car accessories supplier gain actionable insights into the ways to devise potential branding strategies to keep themselves updated on the current market trends. Additionally, the client re-defined their advertising and media campaigns to enhance their return on investment. The market segmentation solution offered by Infiniti also assisted the client in better marketing their products and services to better serve its customers.
The global car accessories market is expected to experience enormous growth in the coming future. This market is anticipated to be driven by increasing demand for cars across the globe. Additionally, increasing consumer inclination towards an entertaining driving experience and growing vehicle customization among a young population are likely to boost the demand for car accessories market share. Moreover, technological advancements are expected to open up new growth avenues in the near future.