Baird Perspectives: Cycling Industry Outlook
BAIRD PERSPECTIVES Cycling Industry Outlook How the micro-mobility and fitness revolution is impacting the bike industry. In This Report Important trends impacting the cycling industry The competition is mobilizing Winning brands will break away from the Peloton Executive Summary There is a micro-mobility and segments, especially indoor fitness revolution millennials, unfolding. On the surface, • The rise of Direct to these appear to be separate Consumer (“DTC”) revolutions, but they are oriented models with interrelated and have inherent competitive important implications for advantages, the bike industry. The way • A pronounced wealth consumers transport “multiplier themselves, the way they phenomenon” driving experience purchasing and above average growth in using a bike and the way the high-end / premium they train on a bike is segments of the outdoor undergoing a radical market, and • transformation. As a result, An increasing perception consumer perceptions and that fitness, wellness, the definition of a “bike” will access and connectivity likely never be the same. As are the new luxury. Given the rapid pace the bike industry undergoes of industry change, tectonic shifts, new and Given the rapid pace of innovative entrants will industry change, there will there will emerge and consumer undoubtedly be winners and undoubtedly be preferences and losers. While it will be winners and losers. expectations will change, difficult to determine how which will redefine the things unfold, several competitive landscape. industry actors will likely emerge big winners, Key factors impacting the including Specialized, Trek, bike industry are the Canyon and Wahoo. following: • The rise of the indoor For the winners, there will bike training and electric likely be multiple options for bike (“e-bike”) adjacent strategic categories, partnerships or exit • A growing need to opportunities.
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