Leftovers

Superb Bicycle

Recently came across these photos of Superb Bicycle and I was very impressed by their merchandising, interior design, and branding. The shop is located on Beacon St. in Boston and also sells their goods online. 

Designed by OZIIO, Superb Bicycle focuses on fixed gear and urban riding. 

Images via Glam Shops

What Happens Before We Buy?

Have you ever visited a store and saw something awesome, then went home and checked it out online, then asked your friends about it, and then went back to the store to buy it? 

I like to call these points in time, micro conversions. Nearly every purchase we make is preempted by a micro conversion or a series of micro conversions. When someone is overwhelmed by micro conversions it can become too much to handle. The desire to purchase is like an enormous weight on their shoulders. These are the people that walk into the store, throw down a credit card, point to a bike and say, “That one. Now!” 

In bike retail it’s easy to focus on the macro conversion (when someone makes a purchase). That’s where we find the glory of the sale, that’s where the commission is, and that’s when we feel the satisfaction of a job well done. 

However, I like to remind retailers- without a healthy strategy around acquiring micro conversions, we will never see macro conversions.

If you found this post valuable. It would be amazing if you shared it. Thanks - Donny

The True Definition of Bike Shop Marketing

Merriam-Webster defines marketing as “The activities that are involved in making people aware of a company’s products, making sure that the products are available to be bought, etc.” I would confidently say that this is the most boring definition of marketing I have ever read. Instead I believe that effective marketing- unlike advertising or branding -means only doing two things.

1. Maintain a positive connection with customers.

2. Be extremely helpful.

How do you maintain a positive connection? How are you being extremely helpful?

Thanks for reading. If you found this valuable, it would be great if you shared it. Thanks- Donny

Sales Per Sq. Foot in Bike Shops? Take A Guess.

If we were to center a microscope over brick and mortar retail what many people tend to find is that it’s a real estate game just as much as a retail game. If an IBR can earn significant dollars per square feet then they’ll have opportunities to set up business in a location with great traffic, parking, and amenities that facilitate a positive shopping experience. If they cannot earn the dollars per square foot then they’re blocked out of the prime locations and will work harder to convince customers to seek them out. This is how the phrase, “We’re a destination location” was born.

Sales per square foot is a popular metric used in the retailing industry and is simply the average revenue a bike shop creates for every square foot of sales space. Investopedia, a website dedicated to educating people on finances, investing, and more defines sales per square foot like this, “Sales per square foot is used by businesses and analysts alike to measure the efficiency of a store’s management in creating revenues with the amount of sales space available to them. The higher the sales per square foot, the better job management is doing of marketing and displaying the store’s products.”

Signature Cycles . It would be a safe guess to say they are outside of average for bike retailers.

Signature Cycles. It would be a safe guess to say they are outside of average for bike retailers.

According to the National Bicycle Dealers Association the average square footage of a bike shop in the United States is 4472 square feet.  In a survey done by RetailSails, a retail and consumer goods consulting firm, they measured the average square footage of the nine most successful retailers in the US. They found that the average retail space of Apple, Tiffany, and Coach was similar to bike shops at just under 5000 square feet, the difference was how much those stores earned per square foot- and it was a drastic difference.

Apple was the runaway leader by far, earning $6050 per square foot nearly double over second place Tiffany & Co. The yoga-inspired apparel store Lululemon came in third at $1936 per square foot. And what about bike shops? Depending on their size a bike shop will earn between $100 and $250 per square feet.  While most bicycles are more expensive than most Apple products, and require a highly knowledgeable and educated staff, they have the same earning power as a low-end department or a RadioShack.

It’s this kind of earning disparity that tells us bike retailers are clearly playing the retail game, not the real estate game. This means there will rarely be a bike retailer next to an Apple store, Tiffany & Co. or even a Lululemon. Most IBRs simply can’t afford to run a profitable business in those locations.

Since IBRs are playing the retail game they have to convince people to find them and when they do, the people working at a bike retailer have to win them over with an engaging experience, incredible product knowledgeable, and a rooted sense of trust with all cyclists walking in.

Thanks for reading this far. I know you're busy, but if you found this valuable it would mean a lot if you shared it. Thanks - Donny

200 Bike Shops Will Close & Other Predictions for 2014

I thought I'd take a crack at making some predictions for the year. 5 predictions for bike retail, and 5 predictions for the world of retail. In no particular order, here you go.

IN BIKE RETAIL

More bike retailers will move to click-&-collect.
Truly competing with online sales means competing online. Retailers will thoroughly build out their click-&-collect sites.

More bike retailers will become manufacturers.
Apparel and small hardgoods will be the first to be made by the local retailer. Once the retailer becomes the manufacturer, they will no longer be limited by MSRPs or territories.

Bike retailers will experiment with pop-ups.
Instead of waiting inside the brick and mortar, more retailers will open 1-2 day stores where cyclists congregate. Coffee shops, gyms, and trailheads will be the starting points.

200 bike retailers will close.
As some retailers grow, they are not growing the number of cyclists at the same rate. Only way they grow then is through market share.

A major cycling brand will go direct.
One of the top 10 cycling brands in the country will cut out the retailer network entirely. Instead selling direct to the rider.
 

IN ALL RETAIL

Stores will be open on Thanksgiving Day.
This is a no-brainer. For good or bad, the holiday of Black Friday is becoming more relevant than Thanksgiving. Bike retailers will still be closed though, still struggling to capitalize on the holiday.

Apple will update their in-store CX.
The customer experience at Apple is becoming antiquated. They will, again, revolutionize the way people shop. We will all say, “Why didn’t I think of that?” when they do.

FedEx and UPS will announce Sunday delivery.
With Amazon and USPS to launch delivering on Sunday, they will redefine the rules of making a delivery. UPS and FedEx will have to play catch up.

Showrooming will be encouraged.
Retailers are understanding that showrooming is not the death of a sale. They will promote it in store knowing that what the customer finds will match what they have.

Ship-to-store will grow.
Too many UPS packages were late or stolen this year. Customers will opt to ship to the store (or a UPS/FedEx location) giving retailers another chance to convert.

 

Thanks for taking the time to read this far. If you found value in this piece would you please consider sharing it on social? Thanks again. Donny

Should Bike Shops Be Selling Men's Underwear?

The world of bike retail is changing, and changing drastically. Is there anything off limits for a bike retailer?

Twenty years from now we will look back upon this decade and we'll have a name for it. Much like we named the Industrial Revolution. We will point to this time and say, "That's when it all changed." In the world of retail the way it is changing is from the merger of manufacturers and retailers. The traditional model of manufacturer to distributor to retailer to customer is dying and in many places is already dead. From now on it will be simply, manufacturer to customer.

Many would look at Target, Wal-Mart, or their neighborhood grocery store as the traditional definition of a retailer. They bring in products made by other people and sell them to consumers. Though when looking closer we realize that more than 50% of what Target and Wal-Mart sell, they manufacture. Every grocery store has their own brand of items. Even Amazon, the world's largest retailer, is a manufacturer of electronic goods, kitchen supplies, books, and much more.

What does this mean for the independent bicycle retailer? It means, more than ever, they should start looking to create products of their own. Controlling the entire value chain. Right now nearly every bike retailer is the owner (or manufacturer) of the services they sell. Going forward they will begin to own their apparel, the shoes, the nutrition, and possibly even the bikes. 

Some retailers will even expand beyond tradition and start selling items we never expected, but with a brilliant cycling twist. Look Mum No Hands in London sells their own band of men's underwear for example.

Underwear sold by  Look Mum No Hands

Underwear sold by Look Mum No Hands

What is the next product you really want to own?

Thanks for taking the time to read this far. If you found value in this piece would you please consider sharing it on social? Thanks again. Donny

Can Brick & Mortar Beat Online Retail? IBM Thinks So

In a series of recent studies IBM predicted the future of retail saying that in five years physical retail will beat online. With a bike shop as the example they also said:

"In five years local stores will merge digital with the instant gratification of physical retail to offer a more immersive and personalized shopping experience and make same day delivery a snap."

"Local stores will bring the web right to where shoppers can physically touch it, by enhancing the immediacy of physical retail with a magnified digital experience."

"Cloud based technologies will give both sales associates and shoppers rich product information and reviews and help buyers tailor store inventory to customer demand."

Their prediction is clearly biased as IBM makes several of the solutions they are predicting will be used, but that doesn't make it untrue.  The difference I see is that these solutions are primarily built for manufacturers who are also retailers not for independent retailers. I see two ways these solutions are going to be useful for the neighborhood bike retailer:

  1. The independent retailer becomes a manufacturer of something, owning the value chain (manufacturing, distribution, and presentation)
  2. The independent retailer partners entirely with a brand. Meaning that they open up the POS, inventory, and all sales data to a specific brand. Essentially becoming a distribution center for the brand they carry.

 

Thanks for taking the time to read this far. If you found value in this piece would you please consider sharing it on social? Thanks again. Donny

Source: http://www.digitalnewsasia.com/digital-eco...

Could Google Succeed At Running A Bike Shop?

I’m a big fan of heist movies, and one of my favorite heist movies was from 2001 and appropriately named, Heist. It starred Gene Hackman, Danny Devito, and Delroy Lindo. The writing in Heist is worth any movie ticket price and one of the best lines comes from Hackman’s character after being asked how he solved a problem. Hackman said, “I tried to imagine a fella smarter than myself. Then I tried to think, ‘what would he do?’.” The line is playful and a bit silly but I’ve often referred to it when trying to predict an outcome or solve a problem I felt was beyond me.

When looking at the future of bike retail I pull the Hackman Heist line pretty quick. When trying to think of a person or business smarter than me I landed on one of the smartest companies operating today; Google. Then I ask myself, “How would Google run a bike shop?” Here is my conclusion.

1. Relevance rules. Whenever you use Google your results, docs, and mail are all relevant to you. You are the center of the Google universe and everyone who interacts with Google feels the exact same way. If Google ran a bike shop the customer would be at the absolute center of everything and every experience in the store would revolve around the customer experience.

2. Keep it simple. Google has been known for one of the cleanest and most minimal home pages on the web. When Yahoo and AOL were in their heyday they were covered in stories, links, and photos. Google came in and changed the game with a simple and clean format focused on one goal, search. In 2008 Marissa Mayer wrote a blog asking the question, “What comes next in the series? 13, 33, 53, 61, 37, 28…?” She was referring to the number of words on the Google homepage and their constant strive to make it fewer and fewer. In Google’s hypothetical bike shop they would have a very focused offering, dedicating their time and energy to what they do best. If Google saw themselves as the bike shop for mountain bikers, there would be nothing that didn’t relate to mountain bikes.

3. Test everything. Google exhaustively tests everything they put online. Product teams, service teams, and engineers are all committed to testing and recording the their findings. No software application makes it to the customer without a thorough vetting internally. In a Google bike shop this mentality for testing would carry through to the product selection, merchandising, pricing, and services offered. Nothing would make it to the customer without a strict testing process first.

4. Track everything. When you perform a Google search for “Books by Donny Perry” Google will record your preferences and remember your search. Next time you pluck away the word “Books” you will see you past search for books that I’ve written. This would work in their bike shop as well. Google would keep detailed data on their customers in hopes to help them predict their needs in the future. When someone at a Google bike shop buys a tire, Google would know when the tire needs to be replaced.

5. Competition is broader than you think. Google’s competition includes Bing, Yahoo, Microsoft, Apple, Amazon, and even Adobe. But their competition goes even further than that, Google is also competing with AT&T for directory assistance, Kodak for photo sharing, and much more. Google would recognize that competition for a bike shop is more than other bike shops and online retailers. A bike shop’s competition will encompass any business or activity that can take the attention of potential customers. It may not appear as immediate competition but a bike shop is at odds against the yoga studio, the movie theater, and even staying at home and reading a book.

6. Future-Proofing. Google deeply understands the three Vs of data: velocity, volume, and variety. Velocity is a measure of how fast the data comes in, volume measures how much data, and variety is a metric gauging how many different sources this data comes from. To demonstrate how well they understand these three metrics, a search for “Bike Shop” yields over 200 million results in less than a half second. But Google a step further and adds two more Vs to the equation: viability and value. Nearly any bike shop can tell you the velocity, volume, and variety of their business but very few will be able to tell you the viability and value. Google’s bike shop would demonstrate great viability by showing the potential for positive growth in the community and value by being one step ahead of their customers in predicting their needs.

Google has built a great framework to their business and there are many more businesses like them. All with an idea, strategy, and execution we can learn from. We just have to think about someone smarter than us and ask, “What would they do?”

Thanks for taking the time to read this far. If you found value in this piece would you please consider sharing it on social? Thanks again. Donny