Case Study: High Gear Cyclery, Longmont, Colorado

          “Our goal is for you to love your cycling experience!”

- Buzz Feldman, Owner

There are some tough markets across North America, but one of the hardest has got to be Colorado. Long touted as a sports paradise, bike shops, like ski shops, seem to be a dime a dozen. A quick on-line search resulted in 11 shops within a 15-mile radius of Longmont, Colorado, home of Buzz Feldman’s High Gear Cyclery and 47 within a 25-mile circle.

High Gear puts their mission right out front: “Our Goal Is For You To Love Your Cycling Experience.” This showed up on the web search and it is printed right on the front door when you walk in. This is just one way Feldman distinguishes his store from the others in the area.

“Four years ago, I purchased a building for a new home for High Gear; 5750 square feet with an open, airy, feeling. We designed it to be more consumer friendly. For example, all of our repair stations are exposed adjacent to the sales floor. They are no longer hidden behind a wall. This encourages more dialog between the mechanics and our clients,” said Feldman.

T.H.: What other changes have you made?

About the same time we joined YaYa! Bike. Their client Care System showed us how to offer services that clients find value in, to get more referrals, and develop more client loyalty. Our sales increased as a result.

Then two years ago, we brought Body Scanning into the store. Our clients love it. It creates such a “wow” factor because customers don’t have any expectations of the service (they now receive) when they come in shopping for a bike. Body Scanning helps us sell more bikes.

And the next step will be linking the data we input to Body Scanning with our POS system to streamline the process and get us better client data.

We have installed a computer terminal for our clients to use in the store.  It enables them to search our website for lifestyle information and the Internet for information on products we don’t have in stock.  We will soon be activating this terminal to collect client feedback of their shopping experience.  This will also enable us to send “Thank you” letters to them sooner after they have been in.

T.H.: That seems like quite a lot of changes in a short time, where do you see your business going?

Five years ago, it was very product focused.  Customers were sold bikes based upon the spec of the bike.  At this time, our sales are more “experience” focused: giving the client - no longer the customer- an exceptional experience when they shop with us.  I don’t think customer expectations have changed in terms of service.  The items they are shopping for has changed.  They also seem to be willing to spend more for perceived value.

The current trend is away from being product focused as we were in the past.  We try to focus on the experience the client has with us and while they ride their bike.  In the future, I think the trend will be more lifestyle oriented.  We are just now starting to see this as clients rely more on their bikes for commuting and achieving their fitness goals.

T.H.: What makes you stay at this? It is not an easy business.

Tenacity. I am just too dumb to quit when the going gets tough.

T.H.: So you have done a lot to get people into the store what happens after they walk in your door?

Before we approach the customer, we allow them to get comfortable with the store’s atmosphere.  We usually wait until they stop in front of a product, unless they appear to be looking for something.  We always ask, “What brings you into our store today?”

If they are shopping for a bicycle, we try to get them to the Body Scanning booth as soon as possible.  We explain the principle of having a bike fit properly and we explain the steps we will be going through to determine the correct fit for them.  Once we have the customer’s measurements and have used the Body Scanning program to determine the type of bike that is right for them, we then explain the range of services the customer will receive after they purchase a bike from us: a free check-up, email news, fit guarantee, satisfaction guarantee, etc.  Then we pick the one bike that will best satisfy their needs, perform the fit adjustments to it, as recommended by the Body Scanning program and send the customer on a test ride with a helmet.  The goal is ONE bike: not 3 or 4.

Our process puts the early emphasis on the customer’s needs.  We are not talking about the bike, but rather getting the correct fit, the correct position on the bike, the correct type bike and the services the customer will receive.  The bike is the last thing we talk about.  Before getting Body Scanning, we would talk about the bike first and then try to convince the customer that it was a great bike.  Now we talk about their needs first and the experience they will have.  Previously, the bike’s price was always a big issue.  Now it doesn’t even come up.  Previously, customers wanted the best “deal”; now they are clients and happily paying more for the “experience”.  They see the value.

T.H.: How are your closing rates with this system in place?

Our method is anecdotal in nature.  We don’t have a formal system to track closing rates. I do know that it varies during the year.  During the height of the season, our perception is that we are closing between 80 and 90% of all bike shoppers.  I have been told that is way too high to be accurate.

The average selling price of a bike is approximately $500 and that is at a 42 percent margin.

We need to improve our accessories sales at the time of bike purchase. It is too low, only 2.55 items per sale.

T.H.: Who are the people that are walking in your doors?

We are a main street business so we get a lot of walk-in business. Our client is primarily families, parents in their 40’s with two kids. A growing segment is Boomers and seniors in their 60’s. This is very health conscious area of the country and Colorado has the highest per capita rate of involvement in active sports in the United States.

T.H.: And the industry in general? What is your feeling on where it is headed?

The industry is currently being led by our consumers rather than by the manufacturers.  Manufacturers have never shown they have the desire to seriously promote cycling on a national basis.  They distrust each other so much that they are unable to band together in their collective best interest:  getting more people on bikes, more often.  I don’t see this changing in the near future.  The leadership is coming from consumer groups, League of American Bicyclists (LAB), Thunderhead Alliance, etc. and also from tour companies, that the industry largely ignores.  Leadership is also coming from The Bikes Belong Coalition, a lobbying group that has had success raising funds from the industry, which has enabled it to obtain federal legislation, and funding for bicycle infrastructure.

Currently, some manufacturers are establishing programs to help dealers run their stores better by providing various marketing and consumer services.  Their incentive for this is totally focused for their benefit ahead of their dealers; dealers must defend their value to the manufacturer yearly.  If these efforts stagnate or fail to meet dealer expectations, we may see a dealer revolt that will require manufacturers to justify their presence in the dealer’s store.  This is the model that exists in many other retail industries and in Europe, and in Wal-Mart.

One disturbing trend that I see is that the industry is not attracting the beginning cyclist any longer.  We need that consumer who will buy the $300 bike for himself this year, then return next year to get one for his wife and kids as he upgrades himself.  He will return a year or so later to upgrade again and so on.

The exciting trend is Safe Routes to School, which the manufacturers have not embraced for some unknown reason.  This program will pay off in the future since we are educating youngsters about the fun of cycling.  They will return to it as they mature.  Safe Routes to School is being led by consumers: the LAB and moms and dads.