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AUGUST 23, 2002 CLICKS & MISSES By Timothy J. Mullaney Where the Rubber Meets the Road With its wealth of information, ease, and savings, Tirerack.com sets the sort of example that struggling e-tailers need to heed
Then my car went in for service last month, and the dealer told me I needed new tires. Now this was kind of a surprise, because the car has only 27,000 miles on it. But I got a bigger shock: The Volvo dealer wanted $900 for a new set of Michelins. NEW ROUTE. It's the kind of dough that motivates me to ask questions -- and to set aside my assumption that I couldn't get tires online because they'd be too expensive to ship and too complex to buy without a salesman's guidance. From my conversations with the dealer and Michelin's call center, I knew already that my usual way of buying tires -- just do what the salesman recommends, and get the longest warranty you can -- wasn't going to cut it. So I ended up at Tirerack.com, the most polished and professional of a handful of sites I found that sell tires online. I saved a cool $500 by going to a site I had never heard of -- one based in the noted Internet capital of South Bend, Ind., I might add. And I ended up feeling a lot better about the product, too -- because Tirerack's blend of software utilities and user ratings taught me far more about my tires than I had ever known. Tirerack does a lot of things well that other e-tailers should take note of, but too few do. For instance: It makes the sale by giving you better information and advice than you can consistently get offline. The best reason to buy many products online is the bad or inconsistent advice you get offline. Tires are no exception, given the wide disparity of the quality of staff -- some excellent, some barely articulate -- you can meet in auto shops. My story is instructive. The Saturday morning after talking with the car dealer, I called Michelin. And I learned the reason my tires cost $900: My station wagon -- purchased, like seemingly all Volvo wagons, after the arrival of a baby -- was equipped with some of the highest-performance tires Michelin makes. Two different people at Michelin's call center (neither of whom knew I'm a reporter) insisted that my car needed V-rated tires to perform properly. But neither one could explain to my satisfaction why, or what the difference would be if I downgraded, or even what was so special about the V rating (or, for that matter, what the V stands for besides very, very expensive). LUDICROUS ADVICE. Neither could they explain why, if my original-equipment tires were such hot stuff, they came with no tread-wear warranty at all. They simply told me I couldn't do any better, and invited me to shop around and I'd see. Bad answer. In two minutes online I learned just what ludicrous advice I'd gotten. V-rated, it quickly developed, is a code for tires rated to run at a consistent speed of up to 149 miles per hour. Now, granted, my car is European (made in Belgium by a Swedish auto company, now owned by Ford). But from the looks of things, virtually all 35,000 Volvo V70-series wagons sold last year in the U.S. were delivered within a five-mile radius of my home in New Jersey, where they perform arduous duty such as toting car seats and their occupants to the Maple Leaf diner. In my world, hairpin turns exist mostly under railroad bridges in 25-mph zones and the closest thing to an autobahn is a DVD of Pierce Brosnan as James Bond set to replay continuously. The advice from Michelin -- and from the car dealer -- had a lot to do with maximizing revenue and nothing I can see to do with choosing a product that fit my needs or the way I drive the car. QUICK EDUCATION. Instead of trying to sell with bluster and fear-mongering (as Michelin has done with years of tiresome commercials featuring infants), Tirerack uses data and cool, clear explanations. The best reason to use this site isn't price -- it's how much more you'll know about your tires by the time you're ready to buy, which will make you more satisfied with what you get. To explain all the information Tirerack doles out would take longer than the average salesperson can afford to spend with you, even if the salesperson is knowledgable. Specifically, I liked three information features at Tirerack. First, an excellent point-and-click guide asking how you use your car and your tires -- what kind of car it is, whether you drive in snow, and the relative importance you attach to comfort, tread life, and handling. (You rate each as either first, second or third in importance). Then it narrows the tire models it has that fit your vehicle -- 37 in my car's case -- to a single best choice and lists of "appropriate matches" and "other matches." Second, it has detailed information on each tire -- its specs, its warranty, and easy utilities to help you compare one choice to another, coupled with clear explanations of the rating systems that let you tell one tire from another. Third, it has aggregated reviews of different tires from thousands of consumers. Each tire has user ratings, on a scale of 1 to 10, on handling, noise level, and the all important "Would Buy Again" rating. CUSTOMERS' CHOICE. My original-equipment tires -- the ones Michelin's sales staff swore my car wouldn't run right without -- commanded a 6 Would Buy Again rating from customers. On a government-designed scale measuring how long tires last, their 300 treadwear rating was well below the 420 of a set of Dunlops that sell for $52 apiece. Their A rating for traction was lower than the Dunlops' AA. The difference: The Dunlops had a better warranty, higher user ratings -- and an H performance rating instead of a V, which means you can drive them up to 136 mph. That's a trade-off I can easily live with, short of getting carjacked by the character Dennis Hopper played in the movie Speed. Given the price and quality findings, it was little wonder that the Dunlops' "Would Buy Again" rating of 8.5 was also much higher than the Michelins. This longish story makes a simple point. If someone designs a Web site well enough, they can take the selling process far beyond the "trust me" that usually dominates discussion when consumers understand the product poorly. Amazon.com does this very well, and so does Tirerack. By the time I bought my tires, I knew exactly what they were. And I had never known that about tires before. It's pretty cheap. I ended up pricing three different sets of tires -- the Michelins that come as original equipment, the Dunlops, and the set of Bridgestones I ended up buying because the Dunlops were on back order. I would have saved money on all three: It was just a question of how much. The Dunlops went for $90 (or $360 a set) at a tire store near my house, which would have had to order them. The Michelins, which I never seriously considered buying at car-dealer prices, were $150.99 each at my local Sears. The $70 Bridgestones I bought were $87 at the local Firestone store. So the basic savings were $152 for the Dunlops, $68 for the Firestones, and $84 for the Michelins, which Tirerack sells for $130 each. LOW-COST SHIPPING. Shipping and installation ate up some, but not all, of those savings. Because Tirerack has warehouses in Indiana, Nevada, and Delaware, it can make most shipments relatively cheaply by reducing the distances involved. In my case, second-day FedEx cost $7 a tire. And I found that most local dealers charged an extra $7 to $10 above normal installation fees to install tires they don't sell. So an extra $17 for shipping and installation is the benchmark by which to judge whether Tirerack's price saves you money. The real savings, however, came from the breadth and depth of information that let me choose a different tire with confidence. My total bill: $308 for tires and a little under $400 total. It's only a few bucks less than buying the same Bridgestones locally, plus Tirerack didn't collect the $20 in sales tax I would have paid locally. But it's up to $500 less than if I had just done what the Volvo dealer recommended. It wasn't as hard as I expected. Tirerack ships most tires by second-day express service. My order left the warehouse six hours after I logged it in, and it arrived right on time. For those who are curious about how one ships tires, no, they don't come in a box. They come bound by little plastic cords that hold sets of two tires together, but otherwise mine were loose. They looked cutely Dukes of Hazzard spending a weekend on my porch before I had them installed. Tirerack has recruited a network of local installers, making the business of putting them on your car as easy as if you bought the tires from a local dealer. Just enter your Zip code on the site and you get choices -- in my case, half a dozen within a six-mile drive of my house, including one just half a mile away. Dealers not on the list were also willing to install my tires. PATIENCE PAYS. To give the system a harder test, I plugged in the Zip code of my in-laws, who live on an island in north Florida. Again, it gave five choices, one right in their town, but the others 20 miles or more away. You can have the tires shipped directly to the installer, but it's up to you to alert them that the tires are coming. I'm not sure I'll ever buy suits or a new bed online just because I had a good experience with tires. But merchants like Tirerack and diamond-seller Blue Nile, which is making headway by using standardized rating systems to make people comfortable buying even engagement rings they can't eyeball, show how smart, patient merchants can attack and solve some of the perceived obstacles to selling online. It's a fascinating experiment, and one I suspect we'll see a lot of entrepreneurs trying to mimic in the years to come.  Get BusinessWeek directly on your desktop with our RSS feeds.  Add BusinessWeek news to your Web site with our headline feed. Click to buy an e-print or reprint of a BusinessWeek or BusinessWeek Online story or video. To subscribe online to BusinessWeek magazine, please click here. Learn more, go to the BusinessWeekOnline home page  | | AUGUST |
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