Digital change is hitting the cycling industry. Established players rely on traditional sales and marketing tools, innovative players and startups are using creative content marketing and authentic story telling to generate traffic. First class online shops and multi channel integration would make online markets accessible to traditional retailers and manufacturers

1. STEFAN KLOSTERMANN
CHANGING THE GAME
DIGITAL TRANSFORMATION IN THE CYCLING INDUSTRY
December 2015 - HAMBURG

2. THE WORLD
IS CHANGING...
QUICKLY!

3. New Sales Approaches
New players on retail level change the
structures and power constellation of the
industry
- Products and pricing
- Value creation
- Market share concentration
- Cross border business
Many new and established
manufacturers use direct digital
sales channels

4. New Marketing Strategies
Highly fragmented target groups have
formed sub-markets with diverse product
and pricing focus and completely different
marketing approaches
With products becoming commodity, a
strong brand is the only remaing factor to
realize above-average margins
The customer journey i.e. the way people
form a purchasing decision and bond to
brands has been completely disrupted by
digital channels
Inspiration Product Information
Decision
& Purchase

5. Inspiration
Product
Information
Decision
& Purchase
Content reaches consumer
outside his rational buying
sphere
 Virally distributed
(no filters)
 Emotionally staged
(Disguised as
Entertainment)
Online channels in all phases of
consumers` decision making and buying
Digital provides unlimited
sources of information
• Neutral channels
(multiplyers, tests &
reviews, recommen-
dations)
• Own channels for brand,
product and company
presentation
(in-depth product
information, first class
content, additional
relevant infos)
Digital offers better way to
serve
• Product advice
(which of our product
suits you best?)
• Immediate action
(Buy now!)
• Convenience & Trust
(Easy way to order, quick
delivery, secure payment)

6. INNOVATIVE
PLAYERS ARE
SEIZING THE
OPPORTUNITY

7. Red Bull and Go Pro are champions in
staging their products
Inspiration
Product
Information
Decision
&
Purchase
 Strong focus on emotional video
content
 Credibility and attention
through extreme performances
 Events eventually become the
product

8. Clever products and marketing have
made Niner a riders‘ company
 Niner Bikes uses its social
channels to present brand
content, reviews, customer
stories and product news
 The Niner team actively
partakes in events, team rides
are featured
 Without big sponsoring or big
marketing budgets Niner has
become a „rider´s company“
Inspiration
Product
Information
Decision
&
Purchase

9. Rapha is the champion of product content
 Products are featured in different user
contexts as well as in cleanly presented
categories
 Pictures and texts are in laid our within
strict corporate design guidlines
 Extensive content regarding product
features underlines the quality claim
Inspiration
Product
Information
Decision
&
Purchase

10. Canyon has always sold bikes directly,
but has perfected the approach online
 Call to action  move to
basket
 Clean order process
 Numerous payment
options
 Return policy creates trust
 All product and process
content designed to give
re-assurance in buying
Inspiration
Product
Information
Decision
&
Purchase

11. WHILE
ESTABLISHED
PLAYERS ARE
STICKING TO
THEIR GAME...

12. Established players in the industry are not
utilising online potentials
Inspiration
Product
Information
Decision
& Purchase
 Minimal attention and
budget of marketing units
 Followers picking up on
trends late
 Exception: Some US
brands with extensive
social media presence
 Most competitors on
satisfactory level
 Own channels with high
management attention
 Websites are content pool,
but no multiplication
schemes
 Most competitors stuck in
traditional sales model
 No initiatives to evolve into
multi-channel companies
 No relation with consumer
aspired
 Exception: Top US players
strive for direct sales
(See: Trek Connect)

13. TREK CONNECT – E-Commerce
- Exception to the rule or First Mover?
Trek has unveiled its E-Commerce
solution in the US
 Top-Retailers can instantly setup
shop in their website
 Traffic is directed to dealer, dealer
receives commision on all
purchase
 Bikes / Parts shipped to dealer or
directly to customer
Inspiration
Product
Information
Decision
& Purchase

14. START-UPS ARE
PUSHING
FORWARD WITH
INNOVATIVE
IDEAS

15. Nutcase has from the beginning pursued
a multi-channel sales approach
Inspiration Product Information
Decision
& Purchase

16. ASS SAVERS builds a strong brand and
multi-channels sales on a single product
Inspiration Product Information
Decision
& Purchase

17. COBI let´s customers pre-order their
product still in development
Inspiration Product Information
Decision
& Purchase

18. RAPHA uses mainly own channels to
publish its best in class brand content
Inspiration Product Information
Decision
& Purchase

19. YT-INDUSTRIES is rocking the freeride
market with affordable top products
Inspiration Product Information
Decision
& Purchase

20. WHAT DO
SUCCESSFULL
ONLINE PLAYERS
HAVE IN
COMMON?

21. All successful competitors share certain
success factors
 Product and strategy development based on
consumer insights ( needs!)
Customer centricity
 With defined customer strategy, all actions are
aligned in that direction
(easier for early stage companies with few products)
Clear product, brand
and marketing focus
 Closeness to target group reflected by passionate teams
 Story-telling approach beats infated marketing budgets
Brand authenticity
 Test and learn approach
 „Fail fast and fail often“
Quick learning
 Strong focus on processes and technology allow for
huge growth once market strategy gets traction
Scalable business
models

22. Digital business is more than an online shop
or an online marketing strategy
Technology focus: IT is no longer a supporting function but the unique selling preposition
(anfd therefore the product) of digital companies
(Long development cycles and high investments will give first movers a sustainable and
growing advantage over traditional players!)
Process orientation: it´s all about building scalable business based on a lean efficient
infrastructure and and highly effective organisation
Data based decision making and process management: Fact based descision replace „gut
feeling“, this requires
(amazon invests 90% of it´s management capacity in developing and automating business
while operations are highly automized and can virtually run by themselves)
BackUp

23. THERE ARE
DIFFERENT
WAYS TO
ESTABLIST
DIGITAL CHANGE

24. Different ways to address digital
transformation
Holistic trans-
formation project
 Analysis based
strategy
formulation
 Business process
modulation
 Organisational
re-design
REVOLUTION
EVOLUTION
DIGITAL
INITIATIVES
GREEN FIELD
CORPORATE
VENTURES
 Selected functional
areas
 Limited project
scope, e.g.
 Brand content
publishing
 Multi-channel
development
 Direct sales test
for single brand
 …
 Build start-ups to
address identified
market niches
 Staff with external
experts and
internal talent
 Ensure process for
organisational
learning
 Avoid synergetic
approach or short
term profitability
targets
 Acquire minority
stakes in start-up
companies
 Use start-ups to
develop future
product portfolio,
customer base,
process landscape
and technology
stack
 Define strategy for
participation
(knowledge and/or
value)