Where is Offroad Headed?

Jul 8, 2011

Offroaders are known for playing hard.

And play hard they still do even in this economy.

Despite record high gas prices and rising vehicle costs, offroad enthusiasts are still taking to the hills, dunes, forests and rocky roads.

“We still see a steady stream of activity in the offroad market,” says Melanie White, marketing manager for Hellwig Products Co. Inc., Visalia, Calif. “It seems that even though there is the rise in gas prices, folks are still getting out with their families and hitting the trails. It might just limit the distances they plan to drive to the trails, but it’s not stopping their trips.”

Perhaps that’s largely because offroading isn’t just a hobby for many – it’s a lifestyle. It’s almost part of their genetic makeup. So, they may cut back but they won’t cut out their activity. Most offroaders are just being more selective in the events they attend.

“For some people that means that they’re attending fewer events,” according to Lisa M. Wood marketing manager for ARB 4×4 Accessories, Renton, Wash. “For others, it means that they are choosing to attend events closer to home, The positive news is people are still hitting the trails and having fun.”

Miles driven may be down, but enthusiasts are still using their vehicles offroad and on and still putting money into maintaining and upgrading their rides.

“We’re pretty much vertical Jeep,” says Tom Richardson, owner of Warrior Products, Tualatin, Ore., of his market segment. “[Enthusiasts] are still going to do what they do for recreation …that’s why we haven’t seen much of a turndown. People might be staying closer to home, but they’re still going to use their vehicles.”

“I own a Jeep myself,” says Doug Parks, director of marketing at Houston-based N-Fab. “It gets about 8 miles to the gallon. So, I don’t drive it as much as I used to.” But from a business perspective N-FAB isn’t seeing an impact in sales because the company is still in a growth stage and because their products are not offroad exclusive.

Promoting events that promote offroading

Getting involved in offroad events is a big way to grow the market and promote your business.

“Anything that supports the end users, clubs and groups that work to help maintain our trails is great for business because it’s good for the industry and the growth of the sport,” says ARB’s Wood.

Anything that grows the offroad segment obviously grows your own share of the segment. But it’s not just about giving away sponsorship funds to grow the market in hopes of growing your business. It’s about putting your shop front and center at the local events that your customers and prospects are participating in.

“These are great places to meet new customers or build relationships with current ones,” says White. “People like to buy from who they know and trust, and the trail is the perfect place for this. Also sponsorships can help build your company as the go-to company with the same crowd.”

It’s also important to do everything you can to help promote any events that your sponsor. You are just as interested in getting the word out and bumping up attendance as the guys running the event. The more attention you drum up for an event that you sponsor, the more attention you drum up for your shop. So, you want to promote the event any way you can from posters in your shop to mailers to your customers.

“Plan early,” says N-Fab’s Parks explaining that you need to be thinking ahead to get the word out effectively. Parks gives a laundry list of media ideas: “E-mail, social media, Facebook, MySpace, Twitter, Advertising in magazines, print media works really well. Radio works pretty well…Any type of media can help – and all of them together work out better than using just one.”

But you don’t have to shoulder all this cost of sponsorship alone. Partnering with the brands you carry can help. If sponsorship is new to you, or even if it isn’t, you can get some great advice and ideas of what other retailers are doing with their sponsorships by calling your manufacturers.

Manufacturers also can provide you with marketing swag: Ask about items like banners, T-shirts, key chains, decals and even product giveaways for drawings. In my experience, it’s important to be sure that any marketing material you use is co-branded as much as possible with your shop’s name and phone number or website. If it can’t be on the item, then be sure to attach your business card to the item.

“I used to run retail stores,” says Warrior’s Richardson. “I’d say that when shops want to promote something in their area, get a hold of some of their better manufacturers. … All manufacturers have advertising budgets. We, for instance, have one specifically for that category.”

Obviously, when you partner with one or two manufacturers, you want to push their products at the event as much as you can. Bringing some of your best-selling items to show off and/or new products that are trending up can help you boost sales for both you and the manufacturer. That means you need to keep your pulse on the market.

Keeping up with the trends

New and novel does not seem to be the trend in 2011 and the foreseeable future. When customers are looking for products, they aren’t looking at fads or trendy items. They are focusing on mainstays and items that have been around for a while.

“It’s the traditional ones more than anything,” says Richardson about what he is seeing at Warrior and in the market in general. “When they take a survey it’s always bumpers that are the first thing Jeep guys, and now truck guys, ask for…Suspension and tires are always popular.  -¦ I think the LED lights are something that’s new this year. I think we’ve been selling LED lights for just a few years, but we’ve seen a real uptick.”

“We’re well known for our tubular steel steps,” says N-Fab’s Parks, reinforcing Richardson’s perspective on traditional items being the backbone of sales in this economy. “We own the patent rights on those. So, that’s been strong for a long time for us. We’ve started venturing out into other avenues like pre-runner light bars that are doing really well. It’s not an expensive item compared to other stuff, so it’s more affordable. Affordability makes it more popular with enthusiasts.”

While wild new fads are not emerging this year, Hellwig’s White sees a marketing trend of bundling products together to increase value to customers, and manufacturing trends in advanced product quality based on advances in fabrication techniques and materials.

“We are seeing a trend in offroad add-ons to not necessarily be one item, but more having to do with packaging items together; it seems folks like the ability for one-stop shopping,” says White. “There have been great advances in technology and materials available. We’ve been able to be very selective and offer high-grade end-links in our long-arm sway bar kits that we didn’t have access to several years ago.”

“Even with our wide product line, we’re not seeing a trend for any one particular product,” says Wood. “But the Jeep and Toyota models continue to be our most popular.”

Switching gears from product to changes in enthusiasts’ activities, ARB’s Wood sees changes in the way customers are using their offroad vehicles.

“On the competition front, we’re seeing rock crawling and desert racing merge closer together,” says Wood with an eye to the future. “This has increased the size of a lot our drivetrain components. From an overall sport perspective though, while rock crawling is still hugely popular, we’re seeing a trend toward more overland style wheeling that involves less aggressive trails for much longer distances.”

Will 4×4 trucks keep on truckin’?

Let’s shift gears to trucks. Traditionally, customers add more accessories to their vehicles when they first buy it. Most owners don’t see value in putting expensive parts and accessories on an aging or near-retirement vehicle. But as 4×4 truck sales decline and owners are holding onto their trucks longer will they be investing more in their vehicle?

While most of the manufacturers interviewed for this article tend to focus predominately on 4x4s and Jeeps, they do feel a slight tug in their sales for older 4×4 trucks.

“The buying and selling vehicle trends definitely suggest that people are keeping their vehicles longer than they might have in previous years,” says Wood. “So, yes, I believe that to be true. While ARB does offer a limited range of products for domestic full-size trucks, our specialty and our focus continue to be on models that are sold worldwide.”

“I’d say this is definitely a trend,” says White “We’ve seen a wide range of vehicles show up on our top-selling list and they aren’t always the newest vehicle; there has been an increase in some of the earlier models.”

“A lot of our generic stuff is getting used on trucks,” says Richardson. But he sees a trend toward more maintenance investment in older 4×4 trucks verses an investment in new accessories.

True 4×4 truck enthusiasts aren’t going to abandon their passion and stop buying trucks, says Parks. “I think that’s people who don’t need it for a purpose. But purpose-driven sales aren’t going to change much. And as people keep their trucks longer, I think many will be spending more money on accessories when they buy it because they expect to keep it longer.”

The consensus of most offroad aftermarket accessory businesses is that offroad enthusiasts will be keeping up their enthusiasm for a long time to come.

Phil Sasso is the president of Sasso Marketing Inc. (sassomarketing.com), an aftermarket advertising, public relations and Internet services agency. He’s also a marketing speaker and strategist. Get his free marketing tip at philsasso.com.