Breaking away from the pack

Designed to carry their riders from busy city streets to deserted logging trails, mountain bikes, with their swollen frames and fat, knobby tires, look very different than their sleek, fragile cousins, the road bikes commonly called "ten-speeds." When first introduced in the early 80's, mountain bikes were considered an aberration, but they quickly became a phenomenon.

According to recent statistics, the mountain bike category now accounts for nearly two-thirds of all bikes sold in the U.S., generating $1.6 billion in retail sales annually.

At the forefront of that market is Specialized Bicycle Components Inc., a Morgan Hill, California-based company that began mass producing mountain bikes in 1981, the first company to do so. In addition to mountain bikes, the company also manufactures a full line of road bikes and riding accessories.

The company was founded and is staffed by bicycle enthusiasts (both mountain bike and road bike), many of whom join company President Mike Sinyard on a daily 20-mile ride over lunch. That close involvement in the sport has been a key to the company's growth and success, says Erik Eidsmo, executive vice president of Specialized. Since the company shares the passion of its customers, it has been able to make products that the market wants.

"Our strategy, from a product development perspective, is really from a user's perspective-not people who ride 300 miles a week, but people who are recreational riders. They provide the base from which a lot of our product development and strategic development comes from. To some degree, the company and the people that work here function as a lab. We are not only the end user, but to we are probably the best proxy that the end user has," Eidsmo says.

Mass appeal uncertain

At first, because Specialized manufactured a comparatively new product whose mass appeal was seen as uncertain, the company operated on the fringe of the market.

"We were the first to commercialize the production of mountain bikes, so people really left us alone out there, until they realized that we were on to something."

With the company's success and the growth of the category came a host of companies bent on grabbing a share of the mountain bike market, and now, Eidsmo says, an industry shake-out appears imminent.

"This industry is at the first maturation cycle. I think there will be some significant consolidation both at the wholesale and at the retail side of the business. And that is the point, from a marketing perspective, that you need to send a message to the industry about what you feel is your position within the industry."

Preliminary research

The chosen vehicle for that message was advertising. True to the Specialized style, Eidsmo conducted preliminary research within the company, asking employees at all levels what they thought about mountain bike advertising in the industry magazines.

"As I started to reach around the company, one of the things that became apparent to me in doing the one-on-one interviews with the employees was that they felt that the advertising in bicycling magazines had become an indistinguishable blur. It used to be something they looked at, but now they have stopped because everything looks the same."

Eidsmo says the company's own messages were in danger of being lost in the clutter, due to imitators in the industry.

"We were the first to do color advertising in the category, and to do life-style-oriented, hip advertising. And now (other companies') communication efforts have started to emulate ours. So not only is our message being duplicated but to a great degree, our look, our style, our whole way of approaching it was being emulated.

"We decided that we needed to do something beyond what the industry had always done, and make a statement about Specialized and its personality that conveyed some sort of attitude about who we were and what we wanted to represent to the industry."

After extensive market analysis with its advertising agency, San Francisco-based Goodby, Berlin & Silverstein, Specialized decided that one of the most important goals of the advertising was to create messages that appeal to current mountain bike enthusiasts as well as to people who might be considering entering the sport.

The size of this latter group, says Barry Breede, group director, Goodby, Berlin & Silverstein, holds tremendous growth potential for the mountain bike category.

"If (it) was really going to realize that kind of growth, it had to be marketed in ways that hadn't been done before, at the same time keeping enthusiasts in the fold and finding a way to reach the audience of non-enthusiasts, which is enormously larger. We needed to find a way to get to those people and get to them in a relevant way."

20-page insert

The first step in that process is a 20-page color advertising insert that appears in bicycling magazines this month. Why 20 pages? Because bigger is better, Eidsmo says.

"In bicycling, as in most enthusiast markets, the consumer publications are also the trade publications. And the retailers equate the amount of support you're giving them with the amount of advertising you're doing. So by being the biggest and most impactful, we send a very clear message to the retailer."

Aimed at both current and future mountain bikers, the insert also addresses those who use the company's many road bike products. Eidsmo says that tailoring the brochure to get through to each of those groups was the most difficult aspect of creating the piece.

"The challenge became what I call the 'high-wire act' of convincing the enthusiasts that we're still a cool, hip company but doing it in a way that makes technology friendly for the non-enthusiast. We wanted it to be usable for the newcomer but still edgy enough that it fits the psyche of the enthusiast," Eidsmo says.

Deftly walking that high-wire, the brochure is part attitude vehicle, part product showcase. Each section has a paragraph of product information presented in a wry style that conveys much about the company's attitude towards itself and its customers. The approach is substantive enough for tech junkies to appreciate yet simple enough for the rest of us to understand.

And if the text doesn't get the point across, the accompanying photograph will. For example, set across the page from a paragraph on the strength of the company's bike frames is a shot documenting an actual event from the recent San Francisco earthquake: a bent-but-not-broken Specialized Rockhopper Comp bicycle held up a portion of an apartment roof that was toppled by the 7.1 quake.

Eidsmo says that targeting part of the message to the mountain bike enthusiast is important not just because they are ongoing customers but also because they are a major source of information and referrals for those thinking about taking up the sport. The enthusiasts provide information and advice, and can be a potent sales force for a product they respect and believe in.

"If you're going to buy a bike, you'd probably ask an authority figure, such as a salesperson or someone you known who's an avid cyclist. Those people will probably influence your purchase decision more than any other single factor."

Focus groups

To get a better handle on the psychological make-up of current and prospective riders, and to test the effectiveness of the brochure--which is slated to run in non-bicycling related publications in the future--with target audiences, focus groups were held last fall.

The participants were recruited to fill three categories:

  • fringe enthusiasts-who aren't currently riders but who are involved in other athletic activities such as hiking, running, and swimming, and who also have the necessary disposable income,
  • mountain bike enthusiasts-who own a mountain bike and ride at least four times a month,
  • road bike enthusiasts.

The mix also included a number of Specialized bike owners, who were contacted through warranty card information. Some names were also obtained from the reader service cards of bicycling magazines.

In the first phase of the groups, participants were shown reprints of advertising for Nike athletic shoes and asked to discuss their feelings towards the footwear maker's attitude-driven advertising.

"The cycling industry is very product driven, as is the advertising. Most people don't realize that Nike's advertising is almost all concept and no product, and somehow they've been able to bridge that in a very effective manner.

"We felt that if we could match up the attitudes about Nike, we could cross the same bridge by having concept-driven advertising that pays off in the consumer saying 'I want to be involved with this.' "

Barry Breede: "We wanted to create an attitude that people who hadn't ridden bikes could relate to by making it friendly and not so technically driven, but still presenting the technology in ways that would make it clear to the enthusiast that Specialized makes good products."

The second phase, which examined participants' attitudes on and reactions to samples of current bicycle advertising, drew very aggressive responses from some mountain bikers, who were offended by the overly technical tone of some of the ads.

"The ads typically show a side view of a bike with a list of specifications that looks like it was done by the research and development department," Eidsmo says. "And the respondents said 'What am I supposed to do with this information? Where can I go to get this translated?'

"It showed us that we're in an industry that is literally talking to itself, because the people that put the bikes together understand them in technical terms, but the riders may not be interested in that."

(Breede says that the research also highlighted the fact that road cyclists tended to look down on the mountain bikers.

"To use an automotive analogy, the road bikers saw themselves as formula one drivers, and saw the mountain bikers as stock car drivers. That's because the two groups take different things out of their sports. The road biker says, 'I've got to race X amount of miles and I have to do it in X amount of time, or else I haven't done my job. They are very technically driven.

"The mountain biker is far different. Like backpackers on wheels, they're want to get out and see nature, and rediscover bicycling like it was when they were a kid, when they could jump curbs and ride wherever they wanted to.")

The third phase examined respondent impressions of the insert and what it communicated about Specialized as a company. The response was tremendous across all segments. Watching a videotape of the focus groups, it's clear that the participants were excited by what they saw in the insert. Some respondents said they wanted to "get up and go riding right now," and "get down to the store and check out these bikes."

"It was the kind of stuff that you hope to hear in focus groups but hardly ever do. I knew we had a home run," Eidsmo says.

Breede says that as the promotion program progresses, the information obtained from the groups will be used with future research to pinpoint the best ways to reach the all-important fringe enthusiasts.

"There will be a lot more research being done as we get into this further and further, which, as far as I can tell is something new for the cycling industry. Because there have been some general studies done, but it hasn't been a category that's lived and died by research. The upside of that is, if we can apply some process and structure to the whole thing, I think we're going to get great rewards from it."

Other promotional efforts

In addition to its function as an advertising insert, the brochure will also be used extensively in other promotional efforts, on the retail level-for in-store distribution by retailers and as part of point of purchase displays--and at the racing events the company sponsors. It will also be sent to Specialized customers who have returned warranty cards, to let them know what the company has planned for the future.

"Your customers are some of your best salespeople, so we're trying to keep them in the information loop and make them proud that they own our products," Eidsmo says.