Note: in the following weeks months I’ll be covering the Top Ten Lies We Tell Ourselves In The (USA) Bike Business. For your reference:
#10: Bad News Is No News
#8: New and Improved, (Part 1) and Newer and Improveder (Part 2)
Here’s #7:
The Lie: Interbike is dead, Man. August shows are where it’s at.
The Reasoning
In the past several years a number of big companies (Specialized, Trek, Giant, Felt, sometimes Cannondale) have switched to holding their own retailer events earlier in the season and/or focusing on demo fleets or dealer tours. And you just can’t have a successful trade show with a bunch of the industry’s major players missing. So Interbike must be teetering on the brink of disaster, mumble mumble.
The Reality
Of course if all the exhibitors pull out, any show is over. But that’s a case of looking at the wrong end of the problem. The crux of the biscuit is not the number of exhibitors, but the number of retailer open-to-buy dollars. If there’s critical mass of latter, there will always be plenty of the former. The value proposition for a trade show (or jsut about anything else) is always about customers, not competitors.
Bike companies with a stable and limited number of retailers are facing an entirely different marketing problem than equipment suppliers or, for that matter, bike companies interested in increasing market share or finding new retailers.
Case(s) In Point
Numero Uno: Very Large Bike Brands. Since retailer dollars are (usually) pre-committed to their major bike brands and therefore not open-to-buy in any realistic sense of the term, the net result of Trek or Specialized’s or similar companies’ presence (or absence) from Interbike has very little effect on the show’s net value for the rest of the exhibitors. In fact, you could make the opposite argument: that retailer time and attention not spent with the very largest companies at trade shows equals that much more retailer time and attention for everyone else.
I’ve heard some exhibitors complain that Interbike has lost value for them because some of the larger retail business owners aren’t there anymore. And it may be true. Perhaps after being bribed (with free air travel) or coerced to take time out of the most profitable month of their season by one or more a primary bike brands, they’ve decided too much time has already been spent away from their core business. And who could blame them? If the middle of September is a dumb time to have a trade show— as just about everyone involved agrees it is— the first week of August is exponentially dumber.
But let me suggest that this is a red herring when it comes to judging the actual value of a trade show: while business owners are arguably more valuable than other checkbook-wielding folks, as long as the ready-to-buy dollars are there in the form of empowered buyers, the presence of business owners is not nearly as important as these exhibitors seem to think. And as to the question of when to have a Bike 2.0 trade show, we’ll come back to that one.
As we’ve already discussed, large bike companies pretty much need to have dealer events nine months ahead of when consumers are going to actually buy their products. But here’s the dirty little secret behind the literally millions of dollars large bike companies are paying to have their own show.
Sit down sometime with a reasonably honest rep from one of those big companies some evening (it may help to get a few beers into them first). And when the moment seems ripe, just ask how many honest-to-goodness actual firm (= non-cancelable) orders they actually get after one of those shows. And— if they’re really being honest— to a man or woman they will tell you, not that many.
Oh, they may get “Pro Tem” orders or “”Subject to Confirmation” orders or “Sales Forecasts” or whatever they’re calling them this year, but here’s the truth: they’re not real orders. Or not really real, if you know what I mean and I think you do.
As one of the leading retailers in the country told me, “You want to know when my preseason order becomes ‘real’? Just as soon as they send me the notice that they’re ready to ship it, and I confirm it. And not before.”
So if the orders generated at those August beer busts-cum-one-brand-trade-shows aren’t “real” orders, what are they good for? Two things:
1. They’re used to forecast production for at least some of the bikes that will be warehoused at retailers (on credit) before there’s any actual sell-through. (Hey, if you had tens of millions of dollars of inventory being produced half a world away and no idea whether it was going to sell, you’d want some kind of security too.) So while those preseason orders aren’t spot-on, they do offer a pretty good general idea— and more importantly, they’re accurate enough so that the purchasing department can make some corrections before it’s too late.
2. They’re also used to keep retailers accountable. If your retailer says her business is going to buy a thousand pieces from you next year, and ends up only buying five hundred, it’s really useful to have something in writing before you cancel her dealer agreement (as opposed to the Bad Old Days, when you’d just open up another retailer in town and not tell her about it.)
But back to you and a sales rep over a beer someplace. Because after you get told your rep doesn’t write very many firm (= non-cancelable) orders after those summer dealer shoes, you’re going to have a very logical follow-up question. Something along the lines of “well, why the heck not?”
And your rep is going to look at you over the top of that beer glass and say almost exactly the following words: “Because they want to wait until after Interbike to see what else is out there before making their final decision.”
In other words, those guys with the August shows don’t write many orders until after Interbike anyway.
Numero Duo: Any Other Exhibitor. Let’s say you’re a helmet manufacturer, like Giro/Bell. Or a wheel builder like Shimano or Easton or Mavic. Or a shoe vendor like Sidi or Shimano or Mavic. Maybe you’re one of the not-so-huge bike brands. Or any up-and-coming brand in any segment of the market. Do you really think your retailers aren’t going to at least take a good long look at your next year’s line before committing all their hard-earned dollars to Specialized or Trek/Bontrager products?
Of course not. Retailers are a lot smarter than that. And if there’s one thing retailers are exceptionally smart at, it’s investing their dollars in products they think they’re going to be able to sell.
But first you need an opportunity to earn some of those dollars. And that involves getting some intensive time in front of your primary customers. Which is to say, retailers.
Not with a grassroots racing effort. Not with product seeding. You need real, genuine eyeball-to-eyeball time the people you want to have selling your products in order to earn your share of their ready-to-buy dollars.
You can’t “make” dealers come to you. In fact, unless you’re one of those companies who command enough retailer dollars to be in the Concept Store business (more about that in Lie #3, but don’t tell anyone), you can’t “make” retailers do much of anything, unless it involves drinking free beer. And maybe not even then.
So there’s not much point of having your own show: even if you could afford it, no one’s going to show up. And unless you have a very small group of retailers that you’re not interested in expanding, it makes a huge amount of fiscal sense to go someplace where the retailers already are rather than trying to chase them down, either individually or in groups. Someplace where they’re out of the shop and all in one place for the express purpose of finding out about brands and products like yours. Someplace like, um—wait, I’ve got it!— a trade show.
So how do I propose to make all this work? Tune in next Tuesday morning to find out.






































