E-Commerce Operation Increasing Purchasing Convenience

Q: How much success has Itaro found in the Mexican market, and to what do you attribute that success?

A: In a single online platform we encompass every tire from every distributer, which generates price competition among companies. These companies really identified with our concept from the beginning, providing us with fleet pricing at a time when we were not yet purchasing large volumes. Given the large supplier network that we manage, we cover 70% of Mexico’s territory with a single platform. We have considerable capability, stocking over 25 brands, each with a detailed product description, and with competitive prices. The platform we provide allows filtering by dimensions or vehicle. After choosing a payment method, the site displays an interactive map that lets users choose the workshop of their convenience. Furthermore, an appointment is scheduled for clients to pick up their tires the very next day. The tires are then mounted, balanced, and the valves are changed, all free of charge. This saves time and is more comfortable and convenient for our clients.

Q: What new approaches is Itaro applying to its business strategies within the country?

A: Itaro Mexico has recently opened a new business unit with a business-to-business approach. We manage 2,500 units at a national level through an in-house system where users can upload serial numbers of vehicles within their fleets, as well as the driver information and the distribution center where they are located. For each vehicle’s serial number we also upload the tire lot number and its mileage, and every time they need a tire replacement we manage it and upload their new United States Department of Transport (USDOT) number. With this procedure we can map the important data that fleet owners require, allowing companies to minimize their costs, as well as their distribution workforce expenses. We created a tailored solution for each of our clients, directly installing the solution in their facilities while taking into consideration all these requirements. Due to e-commerce being an extremely new market in Mexico, we have few online competitors, but the infancy of the industry is still challenging for us. Having a platform that is certified by the Mexican Internet Association (AMIPCI) helps any e-commerce operation. It shows that the site is both serious and secure. We also have customer testimonies on our website, constituting a strong referral for new prospective clients. Creating an effective platform is also extremely important, as it creates satisfied customers and word of mouth marketing. Our Google placement has also been relatively critical.

Q: How attractive has the mobile workshop service been for your clients?

A: It has been a challenge, in part because it has an additional charge as it is a premium service, but we have not invested many resources to position it online, since we wanted to focus on our main platform first. It is still an attractive service that we can offer, and it is an additional marketing tool that has given us brand recognition within the city.

Q: How successful has your business-to-business penetration been in comparison to business-to-customer?

A: Even though we developed the platform beforehand, our B2B efforts started when we realized we had a strong capacity to manage large volume orders with short delivery times at a national level. That is why we developed an information system to track data about the fleet and the tires. Without a doubt our core business is the B2C segment, but the B2B provides an important cash flow that enables us to improve our e-commerce operations. E-commerce investments take a long time to break even and rewards take a long time to materialize. We have had direct requests from companies that need our services, which is how we have developed our business relationships for the most part.

Q: What expansion plans does Itaro have for the years to come?

A: Firstly, we want to reach 100% coverage within the country and increase our B2B business, for which we have a significant number of prospective companies in the pipeline. We have very few online competitors, and we must take advantage of that by linking our company with key search words. If we expand our B2C participation, our online positioning will follow organically. We also intend to introduce tire guarantees to our categories, as customers generally struggle to find them. Alongside that, we would like to adopt a strategy that Brazil implemented in the past, which consists of having clients suggest workshops that are not part of our network, giving us an opportunity to futher expand our presence. We then take care of evaluating them and deciding whether the partnership is feasible or not. If it is, they are added to our distributor network and their service availability begins. This scheme will be added during our second stage, as we want to focus on the workshops that we have with existing allies and gradually expand our capabilities.