SEMA eNews Vol. 14, No. 49, December 8, 2011

Business Technology Strategies Every Company Should Explore

SEMA News—December 2011

9 Current and Emerging Trends and Tools

 
The best technology available to a business is not necessarily a specific hardware or software tool but rather an overall technology management strategy with a focus on critical thinking and process improvement.
   
Business technology is in a constant state of evolution, and it can be a maddening chore to try to keep up. It seems that every innovation begets an even newer version only a few weeks later. In some cases, the latest gizmo is only a marginal improvement on what went before, but there are significant trends and tools that simply cannot be ignored. In some very tangible instances, a company can be left behind while its competitors employ technological tools to expand and improve.

“The best technology available to any business in the aftermarket industry is not necessarily a specific hardware or software tool, but rather an overall technology management strategy with a deep focus on critical thinking and process improvement,” said Jason Braun, executive vice president of Meyer Distributing Inc. “Technology is not considered a cost but an investment in gaining a competitive advantage in your marketplace. The key components to identify are the investments in technology that will produce returns on investment greater than costs. Ask yourself when it has ever paid off to be behind the curve.”

One way to keep abreast of the latest technology trends is to watch computer-store advertising for hardware and to keep tabs on sources, such as CNET, for software and more general trends, said Luanne Brown, founder and president of eTool Developers.

“People tend not to realize how far behind they are until they start searching for new products,” she said. “Sometimes you can just Google pertinent topics and 20 forums will come up containing relevant information. When you do that, though, be sure to enter the year with your keywords. Otherwise you’ll find yourself searching through ancient articles that are outdated.”

SEMA News polled Braun, Brown and other business technology experts about current and emerging tools and trends. They provided a list of nine that every business should be aware of and adopt wherever appropriate.

The Foundation for Everything: ACES and PIES

The Automotive Aftermarket Industry Association (AAIA) Catalog Enhanced Standard (ACES) and Product Information Exchange Standard (PIES) are electronic data standards for product information, such as brand identification, part number or category, product description, pricing and specs. Utilizing these standards allows manufacturers and resellers—including warehouse distributors, jobbers, retailers and installers—to quickly and accurately identify specific products and applications.

Confusion is rampant without standards. For instance, does the part fit a Ford F-150 or an F150? Is it a head light or a headlight? Does it weigh 5.3 lb, 5.3 lbs., 5.3 pounds or even 2.4 kilograms (or kg or kgs)? While the answers may be obvious to an intuitive human being, a computer sees each of these examples as a new and unique element. The results of a computerized misinterpretation are frequently mistakes or redundancy in ordering or delivery. Using standard terms to which all parties agree regarding nomenclature, pricing and dimensional data prevents errors and ensures that the supply chain provides the right components for the right applications.

ACES provides a reliable way of defining an application with a part number. PIES defines properties such as dimensions, weights and pricing.

“When a new product is released with PIES in an electronic catalog, it can go through every function of the supply chain down to the retailer’s Internet site automatically and almost instantaneously,” said Bob Castle, director of eCommerce for Covercraft Industries Inc. “How the part is presented and sold is defined at the starting point rather than piecemeal as the engineering, marketing and selling programs develop. It is important that the industry adopts the standards.”

ACES and PIES may seem complex, but upkeep is a relative breeze once the standards are implemented. Learn more here.

Using the Data: Electronic Cataloging

“As technology advances, paper catalogs are becoming less relevant,” said Tim Martin, vice president of communications for K&N Engineering Inc. “Consumers and resellers are using the Internet more and more to research parts, but Internet search technologies—Google, for instance—can be imprecise. They’re quick, but they don’t allow very fine control in the way that an electronic catalog does.”

Presenting information electronically is different from printing it on a sheet of paper. Precision is important for the lookup process—another reason for using ACES and PIES standards. As an example, K&N can provide data in ACES and PIES or a number of other common or proprietary formats, but complete industry adoption of the standards would simplify the process.

“We provide basic product information—specifications, installation instructions, supporting documentation, images, vehicle applications—all the information required to build a fully functional electronic catalog,” Martin said, “but the real question is how somebody gets that information integrated into their business process when they are trying to sell a part or ship a part.”

Martin said that most resellers and distributors need the support of a consolidating agent—a company that specializes in pulling their data together for them—because it can be difficult to compile data from hundreds of manufacturers. Some of the market leaders for data consolidation include Activant, Datagility, Wrenchhead, Digital Performance, DCi and eTool Developers.

“It really comes down to the type of business and the type of data that best fits the business,” Martin said, “but it’s important that manufacturers keep resellers engaged in the selling process. They have to have a way to repurpose, republish and maintain the information. The challenge is that industry clients are published through different consolidators, and it’s very difficult to get timely data across a wide range of product lines. Understanding electronic cataloging technology also provides an understanding of why a data pool is beneficial for the industry.”

Mobile Computing

 
Businesses can use social media to spread the word using customer ratings, reviews, forums and referrals. Messages on social media sites are spread from user to user as people post comments that their friends then view.
   
Remember when a cell phone was just a phone? The advances in smartphone technology—and now tablet computers—are perhaps the starkest indicator of how quickly technology changes. Current trends indicate that more mobile devices will be shipped than personal computers in the next 18 months. And those mobile devices will increasingly be used to research, shop for and purchase goods of all types. Part of that enormous growth will be due to “thin-client” methodologies in which smartphone applications are stored and delivered from “the cloud” (see p. 74) so that vast libraries of software support these powerful handheld devices.

“A larger and larger percentage of people are looking for products on their personal digital assistants, whether they’re iPhones, iPads, Androids or whatever,” Castle said. “It’s evolving even faster than we think, so we need to take a good look at how we are supporting and selling to our customers in those arenas.”

There are smartphone and tablet applications available today that allow a consumer to enter product keywords—P235/70R16 performance tire, for instance—and the phone will not only find the product, but also indicate the price and provide directions for getting to retail stores that carry it.

“And you can extend that to your car and its engine for hard parts and repair,” said Castle. “That same smartphone with another application ties into the OBDII port and tells you that you just got fault number 48223. It tells you where to go to get it fixed before the check-engine light even comes on. And it’s going to get better. We’re where MapQuest was when it could get you to your hotel but might give you 10 extra turns versus the Google maps application today that takes you straight there in five minutes.”

Cloud Computing

“Mobile computing naturally leads to cloud computing,” said Brown. “People think the cloud is this mysterious thing, but it’s really just web-based services at a core location on the web where you connect to your applications. A lot of people do that with social networking, for instance, but now we’re also doing things such as communicating with sales staff and customers.”

In cloud computing, users access shared resources, software and information on demand. Businesses can access those single-point resources from multiple computers rather than housing each piece of software or data on every machine. That allows much smaller individual hard drives even though the random-access memory (the machine’s computing resource as opposed to its storage capacity) remains extremely quick and powerful.

“You access tools or software from the cloud,” said Gigi Ho, founder and data goddess with Digital Performance Inc. “Cloud computing includes software such as Google apps; utilities, such as on-demand data centers like Amazon S3 or Dropbox; web services, such as those used by UPS, the U.S. Postal Service and eBay that allow computing of shipping charges; and Internet technology service providers, such as Postini spam filtering and Dell’s SecureWorks online security system.”

With increases in mobile computing, using the cloud concept allows both individuals and businesses to access information and services from virtually anywhere to extend their reach.

Location-Based Service Applications

 
Electronic cataloging allows very fine control of product searches. Standardized data provides even more accurate information for every link in the supply chain.
   
According to Aftermarketer.com, smartphones are also giving automotive specialty-equipment companies a whole new way to interact with customers through location-based service (LBS) applications, which allow people to tell their online network of friends about their current location. Google and Facebook recently rolled out LBS applications and features, and other popular LBS applications include Foursquare and Gowalla.

“This is a great way for automotive industry companies to reach a new generation of young customers,” said S. Kellie Colf, former Aftermarketer.com vice president of sales and marketing and now director of sales and marketing for eTool Developers. “You can advertise deals and specials through these applications, which entice customers to visit your business and tell their online friends.”

LBS applications encourage impulse buying, Colf said. And unlike direct mail or newspaper ads, customers see LBS promotions when they’re near a business, so the chances are better that they’ll respond to promotions. (For more information about location-based service applications, visit www.facebook.com/places or www.foursquare.com.)

Localized InternetAdvertising

Understanding and properly using search technology is crucial for any business in the Internet age. Some smaller retailers have been hesitant to employ search-engine optimization, doubtful about the need for national reach. But local searches now allow a customer to shop for products with bull’s-eye precision.

“It’s more than just the natural search results that tend to be more global,” said Martin. “A local parts and accessories business can concentrate on advertising to those searches that are occurring within their geographical area, which allows them to cost-effectively advertise as a local reseller. And for the industry as a whole, that can help grow the market.”

Resellers can drive the dialog about vehicle customization in general using localized Internet advertising while providing a regional presence, a face and a point of sale. A wide variety of Internet consultants are available to advise retailers and help develop localized advertising techniques. Get started with the keywords “localized Internet advertising” on any search engine.

Quick Response Codes

Quick response codes (QRC) are the next generation of barcodes. They are the square, 2-D images that customers can scan with a smartphone camera to open a browser to a specific website, automatically add a contact, display a text message, dial a phone number or register a promotion. The customer simply downloads a scanner application from a website such as RedLaser
(www.redlaser.com) to begin scanning quick response codes images.

“QRCs are becoming a way to link traditional marketing with 21st century marketing tactics,” said Colf. “Businesses can place QRCs on in-store posters, direct-mail advertisements magazine advertisements and even billboards. And there are plenty of online websites that allow you to create QRCs for free.”

Popular QRC generators include Paperlinks and Kaywa.

Social Media

 
Some smartphone and tablet applications allow a consumer to enter product keywords—P235/70R16 performance tire, for instance—to find the product, its price and directions for getting to retail outlets that carry it.
   
Facebook, LinkedIn, Twitter and YouTube have created a whole new way to market products and services and to network with either like-minded “friends” or share industry profiles. Businesses can use social media to spread the word using customer ratings, reviews, forums and referrals. New categories, such as group purchasing sites like Groupon and Woot, can be used to drive traffic directly to a business.

The number of people who use these networks is staggering: 500 million on Facebook alone. Messages on social media sites are spread from user to user as people post comments that their friends then view. Because the comments are from a trusted third-party source rather than from a company, the messages carry greater legitimacy. Thus, any social media user can become a piece of a company’s marketing campaign at virtually no expense.

SEMA offers a number of business technology courses in its new Learning Management System, which is under development by the SEMA Education Institute. A social media course is currently available (free to SEMA members and, for a limited time, to nonmembers as well) at www.SEMA.org/sei.

Rapid Prototyping

While all of the other technologies we’ve mentioned here concern marketing and sales, rapid prototyping delves into product development. (See “Just Hit Print” on p. 66) Most manufacturers know about it, but smaller companies shied away because of its high costs. As with most technologies, however, progress brings not only improved systems, but also better pricing.

In rapid prototyping, a 3-D printer reads data from a computer-aided design (CAD) drawing and then builds a prototype by putting down layers of either liquid, powder or sheet material. The cross sections are eventually fused together into a complete model of practically any part, no matter how complex.

“To have speed to market, you have to have pretty robust R&D,” said Ho, “and you have to have a way of getting the product from R&D into production relatively quickly. Rapid prototyping is a fantastic way to go about it, and it’s becoming more economical.”

For information about rapid prototyping, contact Oscar Muñoz, SEMA’s vehicle product data manager, at oscarm@sema.org or 909-978-6731.

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