Bike Sales Receives Large Boost from Pandemic The pandemic caused great uncertainty for the bicycle market and its dealers. A Bicycle Retailer early-April 2020 poll found 26 of retailers were open, and with above-average revenues; 54 were
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Presentation Transcript
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Bike Sales Receives Large Boost from Pandemic The pandemic caused great uncertainty for the bicycle market and its dealers. A Bicycle Retailer early-April 2020 poll found 26% of retailers were open, and with above-average revenues; 54% were open, but with below-average revenues; and 21% were closed.
Suddenly, consumers realized how beneficial a bike could be during the pandemic, resulting in a 50% YOY increase in sales during March 2020. Then, April 2020 sales increased 75% YOY, totaling $1 billion for the first month ever, according to The NPD Group.
Many states declared bike shops essential businesses, although some states where the pandemic hit hardest announced only bike service was essential, not sales. As of April 10th, bicycle repair was deemed essential in 39 states and Washington DC.<br>
02
Pedaling for Health, Pedaling for Sanity After being stuck at home for an extended period of time, people wanted to escape – and a bicycle was a relatively safe and healthy activity. More than one industry analysts thinks bicycling is about to expand from a relatively narrow to a more mainstream market.
An April 2020 survey of 1,000 adults from Trek Bicycle revealed 85% of respondents said cycling was safer than public transportation to ensure social distancing and 90% said cycling was one of their top 3 primary transportation choices for trips of 5 miles or less.
The bicycle market’s move into the mainstream was evident as the top bikes sold during March 2020 were at a price-point range of $500 to $1,500. People who already owned bikes helped to increase repair revenues by as much as 20% for independent bike shops (IBDs).<br>
03
e-Bike Sales Expected to Race Ahead In an interesting twist (or oversight) pedal-only bikes (almost all are manufactured in China and Taiwan) were subject to tariffs, which negatively affected the segment during 2019; however, e-bikes are not included in the bicycle import data.
In a June 2020 Bicycle Retailer article, an e-bike industry analyst estimated the approximately 287,000 imported e-bikes during 2019 would increase more than one-third during 2020, to approximately 400,000 units.
2019 was the year most imported e-bikes moved from Amazon (and priced at $1,000 or less) to direct-to-consumer, e-bike retail dealers (EBDs) and IBDs. Sales have increased into 2020 in the $1,500–$3,000 and the $3,000–$10,000 or more price-point ranges.<br>
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Understanding the e-Bike Customer Five e-bike brands – Rad Power, Pedego, Trek, Specialized and the Alta Group – account for approximately 70% of the market, according to the e-bike analyst cited from the June 2020 Bicycle Retailer article.
According to a Pedego source, most of its customers don’t consider themselves cyclists in the traditional sense, and represent the much bigger and broader market than the much smaller cadre of traditional cyclist who are most likely to shop at an IBD.
The Alta Group representative interviewed for the article said older Gen Xers and younger Baby Boomers are its prime target audience (45–65), and slightly more men than women. A smaller group of younger adults consider e-bikes a transportation option.<br>
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The Emergence of New Customers Although compiled prior to the pandemic (February 2020), Bicycle Retailer’s interviews of its State of Retail panel members found a general agreement the demographics of the market won’t change much through 2024, with some exceptions.
Some expect increases in wealthier, older customers; others forecast more teen cyclists; and those in major urban centers are anticipate more families and urban professionals will drive the folding bike, cargo bike and recumbent trike sectors.
Of the respondents to the Trek Bicycle survey cited on slide #2, 21% said they were riding more since the pandemic and 50% were likely to ride more with a return to “normalcy.”<br>
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More Cities Make Nice with Bikes According to Places for Bikes’ 2020 City Ratings, the list of the top 20 best cycling cities is quite diverse, including major metro areas: Washington DC; Brooklyn, NY; and Pittsburgh, PA as well as smaller towns: Missoula, MT; Fort Collins, CO; and Grand Forks, ND.
The top 5 cities were San Luis Obispo, CA (3.5 pts. of 5.0); Madison, WI (3.5 pts.); Santa Barbara, CA (3.3 pts.); Washington, DC (3.2 pts.); and Missoula, MT (3.2 pts).
None of these US cities, however, was among the top 8 bicycle-friendly cities in the world, based on a study from Coya, a digital insurance company. Unsurprisingly, the top 3 were Utrecht, Netherlands; Munster, Germany; and Antwerp, Belgium.<br>
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Advertising Strategies Bicycle sales continue to increase significantly, so local shops may find some TV exposure to be very valuable not only to promote cycling as a safe, healthy activity, but also to address inventory shortages of both bikes and accessories.
Suggest bicycle shops design and produce branded facemasks. Provide one or more for free with the purchase of a bike and/or a threshold spending on accessories or services. Distribute them to local clubs that are regular patrons of the store.
Offer customers a used bike or a coupon/discount to rent a bike from a local rental service while they wait for their new bike because of inventory shortage. Another option is a discount on future service.<br>
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New Media Strategies Influencer marketing on social media is an excellent opportunity to promote the cycling with short videos not only from longtime riders, but also new riders who have been able to escape their homelife and work.
Ask customers and local bicycle clubs to share posts on the store’s social media platform about local, dedicated bicycle paths and other roadways where new cyclists will feel safer and share the times of the day/week when there are fewer cyclists.
With so many new riders, ask regular customers and/or local bike clubs to post short videos with pointers for beginners. Content can be directed at different rider segments: young adults, families with children and seniors.<br>
