Editor's note: This column originally appeared in the Jan. 1 issue of Bicycle Retailer & Industry News.
No whining, please: It’s clear that a recent spate of bad news like ASE’s bankruptcy, resulting in the shutdown of a slew of Performance stores swimming in a whirlpool of debt, caught everyone’s attention. Combine that with ongoing trade disputes with China thanks to that disruptive clown in the White House and the quick but painful shutdown of Interbike. As the new year begins its steady 365-day march, it seems we begin a new season plagued by a lingering headache. Once upon a time prognosticators would look at a host of year-end trends and attempt to discern and predict the future for the coming 12 months. And, to a greater than lesser degree, such predictions would tend to be on target. Those days are gone forever. Demographers, for example, enjoy putting life into silos: think Baby Boomers, Gen X, Silent Generation or Industrial Revolution, Computer Revolution, Age of Data. You get the picture. Perhaps we’re in a new age — the Age of Disruption. Which, I might argue, isn’t necessarily a bad thing. Yes, it’s nerve-wracking. Uncertainty can add a near terrifying element to decision-making whether in business or those first-of-the-year personal goals we set for ourselves. But I’m convinced as an industry we will muddle through this Age of Disruption. It’s what we do. Perhaps lightning will strike and sales will boom and the sun will shine and all will be well. Not likely given how quickly clouds can scud across the horizon. Still, hope must beat eternal whether you’re a dealer, a distributor, a supplier or manufacturer. Otherwise, find a dark room. Shut the door. Contemplate your dismal existence. Then find another business to whine about. The bicycle business needs no whiners.
Peering into the Age of Data: It’s fair to say our infatuation with all forms of social media is taking a beating of late. And perhaps the bloom is off that thorny rose. Whether in Europe or in Congress, Alphabet Inc. (think Google) and Facebook’s Mark Zuckerberg, a CEO who disassembles facts with ease, are getting serious pushback over issues of privacy and consumer data protection. And Google is in the crosshairs of Chinese censorship; it must kowtow to a government that pays little heed to personal freedom. Headlines have been less than favorable. Both companies combined control upwards of 60 percent of all digital advertising in the U.S. — some $61 billion, give or take. This digital duopoly has made digital advertising so pervasive, a nonstop stream of come-ons, that consumers are starting to turn a blind eye toward SEO rankings and, instead, are going directly to branded websites. Brands, apparently, still have some cachet among consumers. What this means for the industry is, again, uncertain. But it’s most likely a good time to consider how we go to market to capture those consumers who still view cycling as a go-to activity. Relying on social media — powered by Facebook, Instagram, Google and more recently Amazon — to touch and inspire consumers to spend money on cycling is sure to get more difficult. It’s a great issue to ponder.
Brick and mortar still lives: Lots of exciting news on the retail front. It seems any number of online-only retailers are discovering that consumers want to touch stuff. Hear that, IBDs? Touch stuff. Companies like Casper, the mattress maker, Indochino, an online tailor, Fabletics, a sportswear company, and a lengthening list of others are opening up physical stores, mostly in higher-end malls. And consumers appear to be rediscovering that brick-and-mortar retail offers a level of convenience difficult to find on the web. Apple figured this out years ago. And, on another level, the notion that consumers can buy online, pick their purchase up at a store, and then spend time shopping the aisles appears to be growing. That’s not bad news as digital sales merge with old-fashioned retailing. IBDs struggling to find their way in a changed world of retail should consider what they can do to make their stores “touch-worthy” and how to work more effectively with their suppliers to enhance “touch-worthiness.” More companies (think Trek) are trying to sell bicycles online with in-store pickup. And it’s fair to say that strategy has been, to date, far from a rousing success. At least for now. But it seems that could be the future. To keep consumers wandering the aisles after that in-store pickup will be the challenge. It will require product diversity and product depth, great merchandising and an atmosphere that encourages consumers to pick up stuff and fiddle with it. Think about it.
Those mysterious millennials: A recently released 56-page report compiled by the Federal Reserve Board attempts to shine some light on that vague cohort of folks tagged as millennials, or Gen Y for short. The report’s title gets to the point: “Are Millennials Different?” These are the consumers ages 15 to 37 that many in the industry see as a driving force for future sales. The news from the Fed is mixed. So here are several key findings to ponder. Millennials have fewer assets and slightly more debt than older generations due, in part, to higher costs for education. Millennials are more racially and ethnically diverse than past generations. That’s not good news for the bicycle industry, which has failed to come to grips with racial and gender diversity. Unfortunately, older white males still buy the most stuff from us. That’s clearly got to change. Millennials do like to eat out, so shops selling coffee, pastries, snacks and, of course, beer should pay attention. By and large millennials are well-educated and have the lowest marriage rate of other comparable generations. Unsure of what to make of that. Another finding disrupts some conventional thinking about cars. A lot has been written of late about millennials eschewing four wheels powered by a motor. Not so, the Fed finds. They are buying cars at about the same clip as older generations. Bike and scooter share fans take note. The report is a mixed bag of information and data that is a challenge to decipher. And the report comes with lots of charts. Still, the industry should take a look. A little knowledge never hurts.
