Cyc-Ous, A Million Bikes, SRAM and YOUR Local Bike Shop (Part 3/3)

Actually, that headline is more of an announcement…. an index of “Things to Come.” We’ll cover the above topics, perhaps in separate postings, later and in no particular order, as the one leads on from the other.

But right away let me introduce three names and topics which have much to do with the first three entities/projects in the headline above.

Namely Cyc-Ous, The Million Bike Project and the SRAM connection.

The first, Cyc-Ous, still exists and there is a blog by that name which, if you google it, you will find is about vintage steel bikes (mostly).

The second, the Million Bike Project owes its concept to Cyc-Ous (mostly)

But the Million Bike Title has been “purloined”. And the culprit is SRAM. This is the story…

The Cycle Trade and Qhubeka /SRAM connection story.

One name introduced here you will know (SRAM) and the other probably not – that of F.K. Day. (who is the co-founder of SRAM).

Mr. Day is a very clever man. There is an American “opportunist” marketing term that may be familiar…. “See a gap in the market and take it”. Here is the marketing gap Mr. Day saw.

Shimano, was originally – and still is – a fishing reel company. They then developed a bicycle add-on product… derailleur gears. They were the first bicycle parts producers to introduce into the bicycle marketplace the brilliant marketing concept of Gruppos.

Previously and right up until the 1950s on the Continent, the Bicycle Rrade had been made up of two parts – frames and parts. Separate. There was a problem here as there was no universal standardisation of sizing. This applied to both tubing and threads.

What frame makers did to overcome this problem was sell a frame complete with headset, seat post, BB, chainring and cranks. These parts were mostly sourced from bicycle parts manufacturers, each specialising in a producing a particular product.

So, the Bicycle Trade was diversified into many companies, each competing for business in their particular sector. The producers of saddles, bars and stem, brakes, wheels, freewheel and chains supplied either a parts wholesaler or direct to the retail shop you bought your bike from.

There were thousands of these small family shops – even the smallest village had one. Indeed, many a small town had a frame-builder. These shops mostly bought the parts needed to build up a bike from a wholesale chain using a catalogue to order, utilising the dependable, fast, efficient postal service; the goods being returned the same way.

Trade and communication – in Europe as elsewhere – relied on an effective postal service.

The Origins of and Motivation for GRUPPOS…

Fast forward to modern times and Shimano in Japan shrewdly realised the win-win distribution chain advantages of a frame-maker in being able to also offer a complete bike. The buyer could then buy a complete ready-to-ride machine, serviced and supplied by the shop he bought it from.

At first a Buyer had choice of a range of brands at a shop, but later single-brand shops were established too.

For the bike shop, having a complete bike to sell was a convenience and time-saving solution that solved the size differentiation and parts purchase dilemma. However, the real sell-in advantage was to the frame manufacturer since he made a profit on both the parts and frame.

All well and good, but here came the problem for Shimano and Campagnolo. Their production was hard-put to keep up with supply to the large frame-makers like Giant. Campagnolo turned to sub-contracting smaller operations like Gipiemme, Ofmega and Misch to produce enough parts for them.

In the meantime, in the United States, shortages of supply capacity meant that neither the wholesalers nor the smaller frame-builders could get parts to complete bikes.

Previous to this, the American company, Specialized, pioneered a different concept, designing parts in the States and having them manufactured in Taiwan. In contrast, the superior design and quality Suntour brand derailleurs needed a distribution chain. So they helped open Bridgestone sales in the States.

That still did not help the thousands of independent shops.

Day saw the gap. He decided on Quality rather than Quantity as a launch platform. Quantity requires big investment in tooling and long lead times. He would take on Shimano and Campagnolo at the Top End.

He would manufacture in China, control quality and sell at top-end prices. Sell quality at premium price. Manufacture at economic cost and make big margins. Optimistic endeavors like this require foresight, determination and a willingness to take risks.

Having identified the target market as small frame-builders and retail shops, the first thing Day had to do was produce a premium-priced, quality product to offer. If your opposition can’t supply, you start off running.

But here is the genius way Day introduced the product to the market: He hired 400 people – many of them top-class cyclists – to drive to shops and frame-builders, each being allocated a territory local to him.

Each SRAM representative had a boot full of SRAM parts, an incentive to offer to the buyers and an attractive commission for deals done. Before Campag or Shimano knew what hit them SRAM, had established a firm base which the two leaders could do nothing to counterattack.

To get exposure, SRAM made deals with European and fledgling American Pro cycling teams to ride bikes fitted with SRAM components.

Now we come to Motivation and the “Charity Connection” aspect…

Let’s look at a South African example .

Douglas Ryder had been unsuccessful in approaching MTN with a sponsorship deal for his team. He had no exposure milage plan to offer. Everyone knew what MTN did. All mobile service providers did much the same.

In marketing, one looks for a USP – a Unique Selling Proposition – a benefit to differentiate your product or service from that of the opposition offering.

The medical doctor wife of Qhubeka’s Ant Fitzhenry, Carol Austin, had acquired the SA rights to the Carmichael System and SRM Power Measurement. She monitored the training and performance of Ryders’ team members, and they adjusted their training accordingly.

There were already European teams riding ProTour events on the Continent being sponsored by a charity. ONCE, the Spanish charity for the blind, being the most prominent.

Ryder proposed that MTN sponsor his team with a dual pitch:

An aim to have an SA-based squad ride to Tour de France but, mainly…
The world-wide TV coverage and thus awareness for the MTN support of Qhubeka upliftment initiative, that of helping children in rural areas get a better education by providing bicycles as transport to get them to distant schools.

MTN sponsored the team for eight years but unfortunately for both, them and Qhubek were forced to discontinue sponsorship the year before the team rode the Tour de France due to financial constraints.

None-the-less the Universal exposure of the name Qhubeka did a marvelous awareness job for the initiative and it’s benefit to humanity aims.

MOTIVATION

In my own Incentive Motivation Business as Motive Force, I have often advocated/lobbied for Win-Win “Alliances”.

Over the years at my company, Motive Force, I had always stressed the Power of Selling the Benefit over the “Application”.

To give an analogy: an electric drill enables one to drill holes faster. Yes. True.

But -beyond that, the purpose of a hole might be that you need to affix a hook in order to hang something.

Some other (converse) analogy examples: The ghost writer for two of Lance Armstrong’s books was brilliant in devising the titles of both.

The second book’s title was “Every Second Counts”. Wannabe punters bought it thinking it provided the Secret Formula for Going Faster.

Instead, it advocated “Slow down, smell the roses. Life is short. Enjoy!”

But the first book title was the real show-stopper: “It’s NOT about the bike!”

Huh? It’s actually about the man (or woman) riding the bike and, in particular, the intent and mindset of the pedaller. Both books peddled the concept “Pause for Thought” to pedal people.

Where are you going? How do you get there? i.e. Motivat...

TREAD MEDIA

Message History

Delivery option(s)