BOULDER, Colo. (BRAIN) — After an outdoor industry retail group came out against the ExpertVoice pro purchase platform last week, some bike brands are defending the platform. They say it can drive new customers into shops while providing a variety of other services that don’t harm the specialty retail channel.
“It helps us sell product at full price and that’s the absolute only reason we work with ExpertVoice and that’s always been the case,” said Larry Pizzi, the chief commercial officer of Alta Cycling Group.
Pizzi said ExpertVoice drives sales in at least two ways: by getting store employees riding Alta’s bikes, and by generating user testimonials that Alta uses in marketing.
Alta offers Diamondback, Haibike and Redline products on the ExpertVoice program. Currently those brands offer a limited number of products at a 20% discount off MSRP, available only to industry members. Those brands’ previous distributor, Accell North America, also used ExpertVoice and offered deeper discounts.
Last week Grassroots Outdoor Alliance — a buying group and advocate for specialty outdoor retailers with about 100 retail members — released a position paper about ExpertVoice. The statement stopped short of urging GOA retailers to stop doing business with vendors who use ExpertVoice. But it said it found ExpertVoice to be “incompatible” with specialty retailing because it contributes to a discount culture.
“It’s a site that works against the health and wellness of specialty retail,” GOA’s executive director Rich Hill told BRAIN on Friday. He said GOA had been working on the position for several years and had warned ExpertVoice last year that it was doing so.
GOA made two specific charges against ExpertVoice — both of which ExpertVoice disputes.
First, the group charged that ExpertVoice offers discounts to consumers who are not in the bike industry, including professionals in other areas, like ski patrollers and firefighters, and members of cycling consumer groups like IMBA and USA Cycling.
GOA also charges that once qualified, legitimate industry members remain eligible for discounts on ExpertVoice “permanently,” even if they leave their job.
In a statement, ExpertVoice noted that brands can choose which members are eligible for discounts and tailor the level of discounts to different groups. Participating bike brands confirmed this to BRAIN (although more than one brand said ExpertVoice pressures them to continually expand the number of affiliate groups they sell to). ExpertVoice also said it regularly purges thousands of names from its eligibility lists and requires members to regularly re-qualify.
A variety of purposes
ExpertVoice serves a variety of needs for industry brands, some of whom use the platform in distinctly different ways.
Some brands, including Alta, said ExpertVoice is a cost-effective way to outsource an industry/shop employee purchase program that would be costly for a small company to manage internally.
For others, including Marin Bikes, it’s an outlet for distressed merchandise that remains within the cycling market. Marin’s Sean Walters, the brand’s vice president of business development, said Marin only sells products on ExpertVoice that have already been offered to its specialty dealers for months, and at lower prices than the ExpertVoice price.
Currently Marin is listing just two products on ExpertVoice: two mountain bike frame kits selling for $1,500 and $2,000.
In contrast, other brands use ExpertVoice to launch new products or new categories of products. One well-known brand used ExpertVoice this spring to educate retail store employees about a new product category it was entering (although the lack of inventory this year made it difficult for the brand to assess the campaign’s success).
While some brands, such as Marin and Alta, restrict sales exclusively to the bike industry, others see the platform as a way to reach beyond the industry.
The sock brand DeFeet, for example, sees ExpertVoice as a way to expose its brand to new cyclists coming from other activities, said DeFeet’s Paul Willerton.
“For a brand like DeFeet, there’s always the question of how do we reach more markets,” Willerton told BRAIN. "We make products that can be used beyond cycling, and there are new market entrants finding cycling, whether it’s firemen, or tactical users, or military members. It’s difficult to get in front of those users and that’s what was appealing to us,” he said.
ExpertVoice also has an optional EduGames education platform that requires potential buyers to read or view videos about the brand and its products and to pass a short quiz or two before being eligible to make purchases. While some consumers have to participate in the EduGames, they were conceived as a way to train store employees.
DeFeet’s Willerton said he’s come to appreciate the EduGames.
“It might be the most redeeming element of their whole program,” he said. He said the EduGames are valuable whether the participant is in retail sales or a consumer ambassador, and are a practical way for the brand to provide that education.
None of the bike brands BRAIN spoke with view ExpertVoice as a profit center; Willerton said DeFeet might break even on the program, depending on how deep of a discount it offers, while Pizzi said the program was “quite expensive” for Alta.
In the outdoor industry, however, some brands are rumored to rely on ExpertVoice to provide a significant share of their sales, GOA’s Rich Hill said.
“It’s just another sales channel for those brands, that’s all it is,” Hill said.
Retail response
Many bike retail managers and store owners are critical of pro deals like ExpertVoice, although clearly many employees make use of the programs.
Dan Hughes, owner of Kansas’ Sunflower Outdoor & Bike Shop, works in both industries. While he said bike industry employee-purchase programs seem more “locked-down” than in the outdoor industry, he’s not a big fan in either case.
The outdoor part of Hughes’ business participates in GOA’s Connect trade expos and he received GOA’s statement last week.
“I would agree with them: I think the bro deal has gone too far,” Hughes said.
Hughes said he thought employees "plow through" EduGames to get to the discounts as quickly as possible, not retaining the information. They often order gear that Sunflower doesn’t sell, which he doesn’t think benefits his store one bit.
“It so Wild West-y in terms of what brands they can get access to, and ExpertVoice opens it up to anybody on the planet who is even a bit connected to the outdoor industry. It makes me wonder who pays full price. No one pays full price,” he told BRAIN.
Hughes also pointed out that offering discounts is a key benefit to attract and keep employees. But if many consumers get the same discount, the employee benefit becomes meaningless.
Kent Cranford, owner of the three-store Motion Makers Bicycle Shop chain in North Carolina, said he’s spoken with several of his vendors asking them to stop using ExpertVoice.
“I begged Yakima, specifically,” Cranford said.
Cranford objects to opening discounts to consumer groups.
“There are people on there who are peripheral: firefighters, EMS crews … they are consumers of our sport and suddenly they have a discounted price and they don’t need us anymore, except to come in and learn about it and decide what they want, then order it,” he said. "Because that's free, right?"
Cranford, a member of the National Bicycle Dealers Association board of directors, said the board has discussed ExpertVoice and similar programs but hasn’t taken a position about it.
He said few of his employees use ExpertVoice.
“It seems to be more either ex-employees who get stuff shipped to our store or it’s the IMBA and SORBA (Southern Off-Road Bicycle Association) members who we see more than anything.”
Response to the response
ExpertVoice CEO Tom Stockham wrote a response to GOA’s original paper, and provided an additional document to BRAIN that disputes statements in the GOA paper and in an Outdoor Business Journal article.
Stockham said ExpertVoice has done research with the Wharton School at the University of Pennsylvania that showed sales associates who engage with ExpertVoice sell 82% more than their peers who do not.
“Other research conducted out of the Wharton School in conjunction with Keller Fay Group shows pros who engage with brands on ExpertVoice have 22.2 times as many weekly buying conversations that include product recommendations than an average consumer,” Stockham wrote. “And in third-party optimization studies, product reviews written by ExpertVoice experts and displayed on brand product display pages have been shown to improve e-commerce sales by 15-30%.”
The GOA's paper used some of ExpertVoice’s own marketing claims that it said, proved that the platform keeps former industry insiders on its books permanently. It noted, for example, that ExpertVoice reports that it has more than 130,000 Dick’s Sporting Goods employees in its system, while Dick's has just 50,000 current employees.
But Stockham said the 130,000 figure is the number of Dick’s employees who have ever been enrolled in ExpertVoice.
“There have been 130,000 associates from Dick's Sporting Goods that have ever registered with ExpertVoice, but in the last 12 months 22,000 were active (out of 50,000 employees) and only 7,000 have made a purchase through ExpertVoice,” Stockham wrote.
Asked if Stockham’s fact checks hurt GOA’s argument, Rich Hill told BRAIN, “absolutely not.”
“We pulled all that data from their website, and we took screenshots,” he said. “They have no proof they’ve removed anybody from that list. … There’s no way for a retailer to know whether those lists are being cleaned or to know which groups are offered discounts.”
