Analysts Predict Growth for Bicycling Industry
Other than Lance Armstrong’s annual appearances at the Tour de France, U.S. consumer interest in bicycling has long been a niche market that includes kids and the few adults who enjoy rocketing up and down mountainous terrain. As recently as 2007, the sport experienced a 13% decline in participation. But bicycling marketers may now have new reasons to up their advertising according to a recently released study.
Investment bank Mercanti Group reports that the industry was worth $6 billion in the U.S. last year, slightly lower than its 2005 peak. Dan Remick, Mercanti Group analyst, points out that ridership began increasing in 2008 again and it’s not all about sports. Several factors are converging to increase consumer interest in bicycles.
- The number of commuters who bike to work has risen steadily and now stands at 2% while up to 10% of people ride regularly for transportation.
- The higher cost of gas is influencing more people to use bicycles.
- Governments at the local, state and federal level continue to invest in bike lanes.
- Electric bikes or e-bikes, which are selling well in Europe, are becoming popular in the U.S.
Relatively new to the market, e-bikes combine pedal power with a small motor that allows the user to travel more quickly than when using a traditional bicycle. Because these bikes are reasonably priced, consumers may find them to be an appealing alternative. Beyond the e-bike, the wide range of models now available – such as hybrid, road and mountain, should generate higher sales according to Mercanti projections. This activity is likely to lead to more ad campaigns as manufacturers introduce new models and compete for market share.[Source: Mercanti Group release, August 2009]