SAN DIEGO, CA (BRAIN)—Industry sales have been stagnant despite the many reasons—health, social, recreational and environmental—that exist for people to cycle.
To get to the bottom of it, the Bicycle Product Suppliers Association commissioned two top researchers who found that one of the biggest obstacles to growth is unwillingness to communicate among industry players.
“The biggest obstacle is that industry players are not willing to cooperate,” said Nicole DeHoratius, an assistant professor at the University of Portland. She along with colleague Robbie Kellman Baxter, president of strategic marketing firm Peninsula Strategies, presented findings from their research to a packed room Saturday morning at the Bicycle Leadership Conference.
With a large number of suppliers, a flat market and a declining number of retailers, there is a tremendous lack of trust in the industry, DeHoratius said.
Baxter said the industry has been too focused on the bottom of the “commitment funnel.” The top is the casual consumer, which represents the biggest opportunity. The enthusiast is at the bottom. “The enthusiast is the most attractive model, but it’s a small market. It’s crowded and competitive, and hence less profitable,” Baxter said.
She said the industry seems to pursue a short-term strategy that is cheap and easy when marketing to enthusiasts. A long-term strategy means converting novices. It takes a long time, it’s costly, and requires group collaboration.
The researchers also identified a couple of other problems:
--Too many products SKUs which in turn hurts brands. They recommend focusing on a few key-use products, and advocating for changes in product portfolios and product design processes.
--A retail shopping experience that is intimidating for the consumer, and generally utilitarian and “factual” not “special” even though bikes are considered an indulgent purchase.
Baxter and DeHoratius suggested the industry change the way people perceive cycling through the Web, charity events and rides and non-endemic publications. To reach non-cyclists, the industry may need to target them through a segmented strategy that would include demographics, intended usage, psychographics and benefits, they said.
A number of ideas, generated during breakout sessions, included thoughts on how to coordinate a consistent message about the benefits of cycling; conduct more research to find out what casual and novice riders want; and develop strategies to help retailers deliver a uniform shopping experience.
“We’ve catalogued those ideas—we have them in the queue,” said John Nedeau, BPSA president and SRAM’s vice president of OEM sales.
But, he emphasized, pursuing them will require more time, energy and resources. “The BPSA can be a fantastic facilitator to manage our business,” Nedeau said. “But it’s going to require significant investment both from a human resources standpoint and a financial standpoint.”