The Consumer Market For Bicycles

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The Consumer Market For Bicycles

• Elliot S. Gluskin
• Managing Partner
• Gluskin Townley Group, LLC

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A Glimpse of The Consumer Market Tomorrow
Requires
A Look At Today!
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The View From River Falls
Im not a futurist, I only describe the present
to the 98 of people who are not there yet.
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The View From River Falls

• Between 2000 and 2020 75 of our lives will
  change dramatically
• The way we work
• The way we live
• The way we learn
• The way we shop
• The way we go to market!
• Nine Shift work, life and education in the 21st
  century by William A. Draves and Julie Coates

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The View From River Falls

• The dramatic changes in how we work, live, learn,
• shop and go to market are called a Nine Shift.
• Nine Shift means that the nine hours in our day,
  and the day of everyone else in our society will
  be spent entirely differently in 2020 than they
  were spent in 2000!

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The View From River Falls

• Not everything will change, but 75 of life is in
  the
• process of changing right now!
• Now, consider this according to Nine Shift
  the automobile is going into steep decline and
  will have a much reduced and non-dominant role in
  the 21st century.

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The View From River Falls

• The transformative technology driving change and
• shaping the 21st century isthe Internet!
• We assume this comes as no surprise, and Nine
  Shift
• isnt about the Internet it is all about the
  changes
• already brought about by the Internet and the
• consequences of these changes, including putting
  the
• consumer in charge of the marketplace!

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The View From River Falls

• The most immediately significant Shifts
• People work at home.
• Intranets replace offices.
• Networks replace pyramids.
• Trains replace cars.
• Dense neighborhoods replace suburbs.
• Half of all learning is online and education
  becomes web based.
• Think about what these changes mean to your
• Business, now and going forward!

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The View From River Falls

• Strategic Significance
• We are moving rapidly from an industrial economy
  to an information economy.
• Nine Shift provides a strategic road map of the
• changes our society is, and will go through over
  the
• next 15 years. The insights provided allow
  retailers and suppliers to leverage the knowledge
  to craft product and individual client solutions.

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The New Luxury Consumer

• Trading Up The New American Luxury was first
• published in 2003 and the update was published in
  
• 2005.
• The trading up phenomenon is fundamental, exists
  every where, has lasted over time, and has proven
  to be as influential in bad times as it is in
  good times.
• New Luxury consumers are so knowledgeable,
  selective, affluent, and discerning that
  businesses must listen and respond to them as
  never before.

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The New Luxury Consumer
Change
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The New Luxury Consumer

• One of the most important and powerful changes
  that has helped new luxury entrepreneurs create
  new classes of goods and services has been the
  rise of the specialty retailer.
• As an overview, Americas middle-market consumers
  are trading up. They are lining up to eagerly
  pay a premium price for goods that provide
  emotional rewards.

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The New Luxury Consumer

• The phenomenon involves consumers who earn
• 50,000 a year and those who earn 200,000.
• Single moms do it, retired couples do it, working
  singles, and families with kids do it.
• Over 2,300 people earning 50,000 and above were
  surveyed 96 said they would pay a premium for
  at least one type of product!
• 70 identified as many as ten categories for
  which they would pay a premium.

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The New Luxury Consumer

• The findings confirm that New Luxury consumers
  are
• defined by their highly selective buying
  behavior.
• They carefully and deliberately trade up to
  premium goods in specific categories
• While, at the same time, paying less or trading
  down in many, or most others.
• The criteria for their selective purchases are
  both rational and emotional!

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The New Luxury Consumer

• Trading up is an important phenomenon for
  specialty retailers to completely understand
  because millions of consumers are involved in
  selective buying in a very wide range of product
  categories.
• There is plenty of potential for the future
  because Americans have not finished trading up.

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The New Luxury Consumer

• Strategic Significance
• New Luxury consumers are so knowledgeable,
  selective, affluent and discerning that
  businesses must listen and respond to them as
  never before.
• There remains a vast potential to reshape product
  categories, create new winners, dethrone market
  leaders, simultaneously destroy and create
  immense value, and unleash growth and rebirth in
  mature industries like the bicycle industry!

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The Opportunity

• The specialty bicycle retail channel of trade has
  never had such a big and potentially wealth
  building
• opportunity in the U.S. market as it has right
  in front of it now, today!
• We want to caution that if our channel of trade
  doesnt take action to grab on to this
  opportunity consumers wont wait around for us,
  and other specialty retailers will gladly serve
  their wants and needs.

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The Opportunity
Participation (Millions)
Source National Sporting Goods Association, Mt.
Prospect, IL
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The Opportunity

• The opportunity is really quite simple!
• There are 81 million baby boomers, ages 40-59
• Another 31 million seniors, ages 60-74
• Most of these 112 million Americans, or 38 of
  the adult population want to be healthier, lose
  weight, get out and enjoy themselves and grow
  younger!
• Most are New Luxury-Trading Up consumers.
• That make most of the 112 million a potential
  market for bicycle products and the
  cycling-wellness lifestyle!

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The Opportunity

• Taking Advantage Of The Opportunity
• Our channel of trade does have to make a
  relatively
• minor change in business strategy to focus on
• Attracting and engaging Casual riders and making
  them customers and clients.
• Attracting women, minorities and other non-riders
  to get back on a bicycle by making them customers
  and clients.
• Continue to hold on to our most loyal customers
  the mostly white, male baby boomer enthusiasts.

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The Opportunity

• Taking Advantage Of The Opportunity
• Another change in strategy
• Adopt a consumer-centric mindset and focus
  totally
• on providing a satisfying retail shopping
  experience
• followed by an extraordinary bicycling experience!

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The Opportunity

• Strategic Significance
• What if we succeeded in attracting just
  10-percent of this total potential another 11
  million adult cyclists?
• There are now 23.4 million adult Americans
  participating in cycling. An increase of 11
  million more adult cyclists would be a whopping
  47 increase! Wouldnt you like to take that to
  the bank!

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Elliot S. GluskinManaging PartnerGluskin
Townley Group, LLC

• www.gluskintownley.com
• elliot_at_gluskintownley.com
• 484-951-1767