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.

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

Can You Stop Using the D-Word?

In the bicycle industry many retailers refer to themselves as an IBD or Independent Bicycle Dealer. IBDs have often classified their work as selling bicycles, bike repair, cycling apparel, tools, and accessories. However the IBD is an aging dinosaur in need of a new moniker.

I believe that there is a difference between an Independent Bicycle Dealer and an Independent Bicycle Retailer (IBR or simply bike retailer). An IBD is a dealer and, just like a drug dealer standing on the corner, they schlep a product. Moving product as fast as possible with little or no concern to who buys it or what they do with it. An IBD doesn’t care about the community, an IBD doesn’t care about their reputation, and an IBD will do anything to make a sale. The IBD discounts, cuts deals, screws over their vendors and their customers. They look for the easiest way out of everything while trying to snatch every dollar from the people silly enough to buy from them.

An IBR on the other hand is constantly focused on creating a positive shopping experience. They care about the look of their store.  They never stop striving to improve the services they offer. They work to cultivate a positive community, and the IBR creates a lasting engagement with their customers. The IBR never needs to cut corners or slice prices, their customers recognize their work and see value in everything they do. The IBR may not be cheaper, but they are different, they are better, and customers see themselves as partners.

Are you an IBD or an IBR?

Thanks for reading this far. If you found this valuable it would be awesome if you could share it. Thanks - Donny

Facebook for (Bike) Retailers

Your Facebook post was brilliant but no one liked it, commented on it, or shared it. So what happened? Are you wasting your time on Facebook? Is social media really worth the time and effort?

This quick lesson plan teaches you the basics of being awesome on Facebook. This is not a strategy, this is tactical! I wrote it for bike retailers but really, these rules apply to anyone- big or small- brand, business, or person. 

Winning at Facebook. A How-To Lesson Plan for Bike Retailers. from Donny Perry

If you found this valuable I would appreciate it if you took a moment to share it. Thanks - Donny

When Bikes Ruled The World. A Trip Back In Time.

Imagine a moment in time when bicycles were the biggest topic for everyone to be talking about. It happened and greatly influenced bike culture today. 

The greatest year to be a bike retailer in the United States was 1972-1974. These are the years many industry veterans refer to as the Bicycle Boom. Time Magazine said it was “the bicycle’s biggest wave of popularity in its 154-year history.” In the early 1970s there were approximately 15 million bicycles sold each year which, for the first time in decades, surpassed car sales. To create a sense of how big this boom was, seven million bicycles were sold in the US in 1970- and only 200,000 of those bikes were lightweight 3-speed or derailleur equipped bikes geared toward adults. The majority of bikes sold in 1970 were children’s bikes, approximately 5.5 million. By 1972 the bikes for adults grew 40x with sales breaking 8 million making it the first time since 1890 that nearly one-half of all bicycle production was geared for adults.  The Bicycle Boom was so enormous that the US has yet to match those annual sales numbers.

We can give credit to the Baby Boomers for sparking such growth in the cycling during the early 70s. As many of the Boomers were in their early twenties they were seeking inexpensive transportation and a new form of recreation and exercise. Boomers also had an eye on reducing pollution and they saw the bicycle as their answer.

But the Baby Boomer’s weren’t the sole cause, it was a perfect storm of events as manufacturers in Asia were producing lightweight and affordable bikes for adults. Brands like Fuji, Miyata, and Nishiki are credited as the brands of the Bicycle Boom. They were so dominant that they caught US manufacturer Schwinn on their heels, unable to produce a bike that could compete on quality and price. This arguably started Schwinn’s 20-year demise from their throne as the brand of choice in the US.

View fullsize

National Geographic, May, 1973. Grove, N. “Bicycles are Back, and Booming.”

The three largest US-based bicycle manufacturers still operating today were all born from the 70s Bicycle Boom; Cannondale in 1971, Specialized in 1974, and Trek in 1976. Many of the bike retailers in the country also began in the 1970s and the ones that were already in existence saw massive growth. Bicycles were in such high demand that bike retailers weren’t the only ones cashing in- department stores, gas stations, and small garage shops popped up like flies, selling whatever bikes they could get their hands on. Prior to the boom many bike shops were known as one-stop fix all service centers and you were just as likely to find a grease covered mechanic working on a lawnmower as a bicycle.

If bike retailers that started up in the 70s played their cards right, they rode on four more distinct waves in the cycling trends. They likely continued to sell lightweight, Asian-made road bikes in late 70s and early 80s. They expanded into BMX in early 80s but by the end of the decade were focused on the massive growth of mountain biking fueled by American manufacturers like Specialized, Cannondale, and GT. Mountain bikes would carry them through a good chunk of the 90s until 1999 when road cycling made a monstrous comeback on the coattails of Lance Armstrong’s Tour de France performances. As the 2000s came into focus many bike retailers could have also jumped on board with the growing army of triathletes.

From 1970 to 2000 IBRs grew from sales and service to true community hubs. People would walk into their neighborhood store, grab a magazine, and talk about the sport. Discussion bounced from newest bikes, to comparing technologies, dissecting suspension systems, and which riders were lighting up major tours. Club rides started at the IBR and when they finished everyone would grab a beer from the communal fridge. Everyone knew each other’s name and every store had a distinct club-like feel. If you were in the club, you were in for life. If you weren’t in the club, you were only a purchase and a bike ride away from earning the secret pass to belonging. It was a true subculture. Bike retailers were their own niche and the center of all cycling knowledge for their community.

If you read this far and found this article valuable, I would appreciate it if you shared it. Thanks - Donny

Is it Time to Fire Grumpy Bike Mechanics?

They're surly, they're grumpy, and they hate anything that isn't within their tight criteria of a legitimate bicycle. I'm talking about the angst-filled bike mechanics. 

Stored in my closet I have a small, but obscure collection cycling movies. One of my favorites is the 1998 French-Canadian film, 2 Seconds. The movie follows Laurie, a professional downhill racer who loses her job due to a string of irresponsible behavior, and returns home to Montreal to become a bike messenger. There she struggles for acceptance from other messengers, is confused by the job, and questioned by her brother if she is doing anything productive with her life. After crashing her bike Laurie finds a nondescript bike shop hidden in an alley and there befriends Lorenzo, a cranky, surly, ex-pro roadie who is owner and operator of the shop.

The two characters have a wonderful back and forth banter throughout the movie. In one conversation they play a game of one-ups-manship by sharing war stories from their life as professionals. Lorenzo show his scars, Laurie shows hers, Lorenzo shows the tan lines that have permanently burned into his skin. Laurie describes how lackluster sex is with her girlfriend thanks to the saddle sores.  If you haven’t seen the movie, it is worth hunting it down.

I bring up the movie because the character Lorenzo was portrayed perfectly by Dino Tavarone. His portrayal of the character embodies this idealized vision of what many people believe a bike mechanic is and how we should expect one to act. Lorenzo is older, likely in his 50s and has a salty demeanor. While he appears to be working a disorganized clutter, you have a sense that everything has been put in its proper place. He communicates in grunts and stares, and if you dare walk in with a non-Italian bike he will lash out at you for such an insult to his craft.

His social manner aside, Lorenzo does have some skill. He displays an air of knowledge and experience so deep that no one would question the quality of his work. Some would even go as far to say that Lorenzo is a master mechanic or even a guru. Yet even with these skills it’s hard to ignore the one glaring truth- Lorenzo is an asshole. In a garage all by himself he does fine but he can be a nightmare in a retail business with a mixed bag of coworker personalities, customers bringing in department store bikes, and riders who are repeatedly asking to borrow his tools. Modern day bike retail would be Lorenzo’s nightmare.

What will be Lorenzo's future? Will he learn and adapt or will he be replaced by a new generation of technicians?

Thank you for reading this far. If you found this interesting I would appreciate it if you shared it on your social channels. Thanks - Donny. 

Getting Paid Hourly? 5 Ways You Can Get Screwed!

If you’re working for a bike shop and getting paid hourly there are some things you should be aware of.

1. Minimum wage in the US as of 2009 is $7.25 an hour. Anything less is illegal.

2. Your boss is not required to pay overtime for Saturdays, Sundays or holidays unless you went over the forty hour mark on those days.

3. If you’re under 20 years old it is legal to pay you $4.25 per hour for the first 90 days of employment. Luckily it is illegal to terminate someone making $7.25 or more and replace them with an employee making $4.25.

4. Many states do not require breaks or meal periods for hourly employees.

5. While the laws are very clear that overtime happens after 40 hours in a seven day period, it is not so clear on how many hours per day before overtime is required. Working 11 hours in one day may not equal 3 hours of overtime.

If you’re an owner or manager- don’t be a jerk, don’t do these things.

In the US, you can learn more about the labor rights by visiting the Department of Labor. 

Thanks for reading. If you found this article valuable I would appreciate it if you shared it on your social channels. Thanks- Donny

Hiring People in Bike Retail is a Nightmare. Unless You're Cheating the System.

Finding the right person to work in bike retail is about landing on someone with the right personality and skill set to do the job and move the business forward, In order to do that many retailers may have to search deeper pools of talent and begin courting people respectfully and professionally. Hanging a sign in the window isn't good enough any more. Here are some of my tips for finding great people. 

Get it posted. Put the job description up on your site. List out all the duties, who they will be reporting to, what will be expected, and all the benefits of working at the store (list benefits all the way down to “free socks” if you do it). Pics of the store and their work space would be nice if you have them. As would general information about the city and the cycling culture.

Widen the search. The more qualifications you want, the wider the search has to be. Finding someone who is awesome in your city can really narrow the talent pool. You’re usually left with the 2-3 people that no one else wanted. Be prepared to hire from out-of-city or out-of-state and have people relocate. This is expensive on the front end, but done right the return can be made back within a year. Relocation packages usually require a moving and living stipend.

Hit Linkedin. Doing a search for “bike fitter” on Linkedin has more than 100 results (you have to upgrade on Linkedin to see more). You could also search "bike mechanic" or "bike technician". I would message all of them with the link to the job and ask if it seemed like a role for them. This is a hook to have people start researching you, and ideally beginning the interview process. If they tell you no, ask them if they know someone qualified, and increase your search by 100x.

View fullsize

Hit Twitter. A people search for “bike fitter” or "bike mechanic" on Twitter brings in a couple hundred more results. Send them a direct message similar to your LinkedIn message. It’s ideal if you didn’t message the same person twice.

Look for the person in second place. If you start looking to hire from other shops, I would look at look at the number 2 person doing fitting or service there. That person is usually being blocked from growth by the number 1 fitter, they are generally more open to opportunities elsewhere, and likely to be cheaper.

Once hired, pay accordingly. First, establish the level of service you want given. With that done, I would build a pay structure around the profit from the that area of the store (not sales, not margin- but profit). If this person doesn't have a fit or repair to do, they will want to be in the store selling it. 

Train heavy. For bike fitters or technicians, I would want them trained everywhere and build them up to be one of the most knowledgeable people in the world when it comes to their skill set. I would want this person to have every certification possible. However, the better they get the more money they deserve. 

Don’t forget bedside manner. Technical knowledge only goes so far. People in bike retail need to have an amazing bedside manner and an eye towards creating an amazing experience. 

I hope this helps you out on your next search. 

Thank you for reading this far. If you found this information valuable I would appreciate it if you shared it on your social feeds. Thanks again- Donny

Read This Before You Waste Another Tweet

When is the best time to tweet? How about the best time to update your Facebook status? Or Instagram? We're all looking for a shortcut but here is the hard truth. 

There is no perfect time to tweet that works for every person or business. There is only the perfect time to tweet that works for you and your readers. Articles or experts that argue otherwise are usually presenting some form of aggregated data, which any data analyst will tell you, tends to clump.

Believing in clumps of aggregated data is falling victim to the shotgun fallacy. Aim a shotgun at the side of a barn, pull the trigger, and there will be hundreds of little holes spread across the barn. But there will also be a clump of those shots in the middle. A shotgun fallacy is when you draw a target around that clump and tell everyone, "I hit the target!"

For example, some social media experts will tell you that people check Twitter at 9:00 on Saturday. Though for a bike retailer, 9:00am on a Saturday may be the most popular time for their customers to be out riding their bike. So, that tweet is essentially wasted. Instead posting between 11 and noon might be better, when their customers are finished with their bike ride and checking their feeds. 

I encourage the bike retailers I work with to test multiple times and track which times of day create the most engagement. Turning your calendar to the viewership f your audience is the best way to get huge results from your social channels.

Thank you for reading this far. If you have found this piece valuable I would appreciate it if you shared it on your social channels. Thanks again, Donny

Book Summary: Reinventing the Wheel by Chris Zane

It’s not too often you see a book about the business of bike retail. Zane’s Cycles is located in Branford, CT. Here is a short video where Founder/President Chris Zane describes his business, and here is where you can buy the book. 

SUMMARY

Chris claims a 23% annual increase in revenue over the year before is his company’s average growth.

Nothing was focused on how to execute a sale, instead everything was focused on a higher level on how to get the customer in the store and keep them coming back for life.

The book worked like bike-shop specific bookends on any day-to-day work. Before you can execute a sale or service effectively, company visions like this need to be in place.

While the sales strategies Chris presents aren’t new (in fact he tells us where many of his ideas came from) they are new to the cycling industry. While marketing to gay/lesbian communities is obvious for millions of other companies, I wonder how many bike shops look into expanding their market there?

He mentions several times his plan to grow his one store location to 100 stores nationally. Too bad he never details how he plans to do it. Will be exciting to watch as he does.
 

THREE KEY IDEAS DISCUSSED

1. Zane’s average lifetime value of a customer is $12,500

This give Zane’s roughly $5000 profit if they earn maximum customer loyalty

The lifetime value allows them to understand the cost of acquiring and earning a customer

Arguing over a $100 return is not worth losing the customer and their lifetime value of $12,500

If a business does not understand their customer’s lifetime value, they do not know where to begin pricing strategies in service or marketing.

2. Zane’s has a 3-leg stool to their business. Products, service, and price.

Products:

Strong relationships with strong vendors and suppliers

Vendors need to be willing to go the extra mile in warranty and delivery

Vendors are not partners. Zane’s is their customer and they expect their vendors to treat them as well as they would treat their own customers.

Service:

Satisfaction guarantee. If a customer is not happy with any product they bought, at any time, they can return it for a full cash refund. The author tells a story of a full cash refund he gave a customer who brought in a bike that was 6 years old. The customer then bought a bike 3x the value and has been a loyal customer since. Proving the value of the lifetime customer.

Lifetime free repairs. All repairs that come from general use of the bike are free for life. This focuses his staff to assemble bikes in a manner that demands very little return and strong product education to his customers. The cost of free service is a no-brainer to Chris when compared to the lifetime value of the customer.

Kid’s trade-up program. If a parent buys their kid a bike they can return it for full value towards the purchase of the next size up. While it sounds crazy, this has been a profit center for the shop. The idea that a trade-up program is in place makes the sale easy. Only a portion are traded in and those are donated which earns the shop free marketing and new customers.

Lifetime flat repair program. For $20 you can buy free flat repair for the life of your bike. They sell 4000 of these programs a year and perform free flat fixes about 50 times a year. 4000 x $20 / 50 = $1600 earned for every free flat fix they do. People who ride a lot and are more likely to get flats don’t buy in to the program- they need to know how to fix a flat themselves.

Price:

90-day price guarantee. They match any price and then some.

Because the services Zane’s offers seems too good to be true, they match any price their customers can find on a bike up to 90 days after the purchase

When a customer does ask for a price match they give them an additional percentage on top to be sure Zane’s had the cheapest price. 

This discount is acceptable in light of the customer’s lifetime value.
 

3. Where to put your efforts in marketing

Zane believes that 30% of customers are price conscience buyers, 30% of customers are experience conscience buyers and the remaining 40% can be persuaded to go either way. If you attempt to market to 100% of your customers you will gain approximately 50%. If you market just price or experience you will gain approximately 70%.

Experienced focused buyers spend more, so market your services and the shopping experience. Not the super deals on price. 

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