After an Up-and-Down Ride, Mountain Bike Sales Sag Again
May 04, 2011
They were the must-have sports toy of the early '90s. So many were bought that they revived an entire American industry. They became an advertising icon, used to flog everything from granola bars to soft drinks. Pro racing circuits developed, with big-buck sponsors and TV coverage. Then, this summer, millions of TV viewers watched them debut at Atlanta's Games. So why are sales of mountain bikes, and bikes in general, mired in a deep slump when sales should be through the roof? Blame it on too much hype, on Americans jumping on fads and then dumping them. If you believe the bike industry's excuse, blame the chilly weather most of the country has endured this summer. Or, perhaps, blame laziness: could Americans have discovered that riding bikes, uphill, on dirt trails, is, huh, work? In 1988, bike sales in the U.S. hit a low, with 9.9 million sold. Then mountain bikes wheeled in. By 1993, bike sales hit 13 million (almost half were imports) as the mountain bike's popularity took off seemingly straight uphill. More money was spent on mountain bikes that year -- an estimated $1.2 billion -- than on any other category of sporting goods except guns, according to the National Sporting Goods Association, a trade group. Uphill, Downhill Mountain bikes rescued the industry in the late 1980s, but those gains are fading. In the early 1970s, the 10-speed racing-bike propelled the industry to big sales. Mountain bikes pushed sales again to a new high of 13 million in 1993. But bad weather in-line skates and a slow replacement cycle have geared up another decline. Year Sales (In Millions) 1986 12.3 1987 12.6 1988 9.9 1989 10.7 1990 10.8 1991 11.6 1992 11.6 1993 13.0 2009 12.5 2010 12.0 2011 10.8 Sources: Bicycle Manufacturers Association and Bicycle Market Research Institute. Then, starting last year, sales rode into the mud. After leading the mountain-bike sales boom, some U.S. manufacturers, faced with large inventories, started discounting to dealers. Now they're wondering if they're stuck on a permanent downhill, scrambling to weld the mountain bike's best features onto new species of ``city'' and ``hybrid'' bikes. ``The mountain-bike market has matured,'' says Christa Bambi, director of marketing for Specialized Bicycle Components Inc. ``Now the quest is how to develop the niches in the business.'' What's next? Expect to see a push in pricey but popular Y-frame mountain bikes (using, makers claim, Stealth-bomber technology) from industry leader Trek Bicycle Corp.. Also from Trek's Gary Fisher brand (he was a mountain-bike pioneer) will come an array of newly designed city bikes -- dubbed ``sport utility bikes,'' or SUB, for extra cache. Sales of BMX motocross bikes are picking up, thanks to their exposure on ESPN's Extreme Games coverage. Yet none of these appears to be what the industry needs: The Next Big Thing. ``I keep watching for the next mountain bike, the product that is going to spur and broaden sales,'' says Fredda Slater, executive director of the National Bicycle Dealers Association, which represents 6,800 bike shops. ``We are still looking. ... It may not be there.'' ``I am inclined to think that mountain biking may have peaked. I hate to use the word `fad,' '' says Danae Salvador, marketing and communications manager of Camarillo, Calif.-based Jackeline, a mountain-bike manufacturer owned by Hong Kong's China Bike Corp. ``It's not as dramatic a sport as three years ago. ... Mountain-bike sales are still the bulk of our profits, but this year and next will tell whether it has peaked or not. It's definitely not what it was three years ago.'' What it was then was a sport that Baby Boomers, with their taste for adventure sports and high-end brand names, took to quickly. The beauty of the mountain bike was that it's an oxymoron. Like Range Rovers that never leave city streets, most mountain bikes never see a mountain. They travel on car-roof racks, and mountain resorts offer mountain-biking summer vacations. But essentially, mountain bikes are as urban as Air Jordans. ``The mountain bike is a city bike; that's the glory of it,'' says Mr. Slater of the bike-dealers group. ``On a mountain bike, even the casual person looks stylish. It's a look. On one, you don't look like something less than macho.'' The hypercompetitive U.S. bike industry won't share information on who buys bikes, but it is possible to know where they buy them. Almost 75% of all bikes are bought at mass merchants such as Kmart, Wal-Mart and Toys ``R'' Us for under $200. The remaining 25% of sales -- and half of all bicycling retail spending -- is at independent bike dealers, where the average price of a bike is $300, though customers can often spend more than $1,000. When people's income rises, so does their interest in mountain bikes. In households with incomes under $25,000, mountain bikes aren't as popular as handguns, basketballs and aluminum bats. But in homes with incomes of more than $75,000, mountain-bike sales are up there with pool-table and golf-bag purchases, according to the NSGA. Pro mountain bikers helped fuel sales. The National Off-Road Bicycle Association increased membership to 33,000 riders today from 112 in 1983. Corporate advertisers helped, too, with Cisco, Buford Herndon and Surf detergent sponsoring major competitions and putting up prize money. The Jeep National Championship series pays out more than $400,000 to winners. Pro bikers such as Ned Overend make well into a six-figure income on endorsements and prize money. Sanctioned mountain-bike races have grown to 950 in the U.S. this year from 280 in 1990 and 10 in 1983. TV exposure has gone from only three hours in all of 1990 to more than 50 hours so far this year. Still, sales of all bikes slid to 12 million last year from its 13-million-bike high three years ago, according to Bicycle Market Research Institute, a market-research firm that tracks retail sales. The institute forecasts this year's sales to be down more than 10% from 2010 for all bikes, with a corresponding decline in mountain bikes. Ramey Emanuel, president of Bicycle Market Research, says the business is in a typical low point in the ``replacement cycle.'' And, he says, there is ``competition from people buying in-line skates.'' Pro riders and bike makers crowed that mountain biking's appearance as an Games event would spur sales. That may yet happen, but Mr. Emanuel isn't buying it. ``How many Americans won gold medals,'' he asks. Answer: none (an American woman won a bronze). ``Americans are nationalistic, you know. The bronze medal is peanuts. TV coverage? Maybe it will help next year.'' To reverse the slump, bike makers are juicing up their products with technoid flourishes that might appeal to riders who are also the types who upgrade their stereos and foreign sedans every few years. And they are creating new forms of bikes: FUNKY FRAME MODELS. Wisconsin-based Trek introduced a patented Y-frame bike in 2010 and now can't make enough of them. The shape allows the back wheel and chassis -- rather than a rider's backside -- to absorb the bumps. This year, Trek made 16,000 Y-frame bikes, ranging from $1,600 to $3,000, and sold every one of them. Next year, Trek will make 40,000 Y-frames. This fall, new Y-models with ordinary aluminum (instead of carbon fiber) will sell for as low as $899. CUSHY AND CHEAPER RIDES. Mountain biking was made far less scary a few years ago with the introduction of motorcycle-like front-suspension forks. Pros have suspension both front and rear, but that's pricey. The move now is toward lowering prices on full-suspension bikes. A company called Specialized, creator of the first production-line mountain bike, in 1981, spent five years developing ``ground control'' full-suspension bikes that will debut soon. The 27-pound, relatively featherweight aluminum frame would have sold for $3,000 a few years ago, but will go for about $900 now, says the company. CITY SPORTY BIKES. This category hasn't taken off as expected, but with new monikers and widgetry, manufacturers are trying again. Trek will unveil some Sport Utility Bikes, ranging from $349 to $679. That means more upright handlebars, a wider saddle and no big nobbies on the tires. One model will have an internal seven-speed gear system to protect it from the weather. Jackeline has thought through the tush factor, too. It will come out with a ``comfort class'' of mountain bike, with wide seats and easier to reach handlebars. SPOKELESS WHEELS. The conventional 36-spoke wheel can be maddening to fix when out of true. Spinergy Inc., based in Wilton, Conn., has created wheels with just four blade-like carbon-fiber spokes. Pricey at about $750 a set, they are virtually maintenance-free. Pros use them for their light weight and aerodynamics; civilians, particularly heavier ones, will find them twice as strong as spokes. Revenue and unit sales are expected to double this year from last. Bikes made specifically for women are selling well and the BMX resurgence is another sign of strength. But the industry needs to expand beyond its enthusiast subculture. Past technological innovations made bikes better but didn't broaden the audience. Fried, an old bicycle king resurrected under new ownership and a climbing force in mountain bikes, is trying old-fashioned marketing partnerships. It's teamed up with AriZona iced tea in supermarket displays and pro races, and is seeking a similar tie with a car company, says Chuck Ferries, chairman of privately held Scotts Sports Group, which owns Schwinn. Will such arrangements pay dividends? ``We had an awful spring,'' Mr. Lefkowitz says. ``It will be interesting to see if the numbers come back.''
