The cycling market has grown radically in recent years owing to the recent success of British cyclists such as Bradley Wiggins, and government cycle to work initiatives. The rise in popularity has had positive results for nearly all cycling retailers, however, online cycle pureplays, which offer a larger range online at affordable prices are the real winners, threatening high street players.
Evans competitor Halfords is protected from the online threat through a clear target market of ‘affordable bikes for families’, and its strong online presence following the purchase of online cycle retailers Tredz and Wheelies. Meanwhile, Evans Cycles lacks a clear USP and stocks similar products to pureplays but with more expensive delivery options online, leaving it more exposed.
Evans Cycles on unsteady ground
Evans Cycles’ recent performance has been shaky reporting a fall in pre-tax profits of 64.9% in 2015. Since then, the market has become even tougher for Evans as private equity companies and large retailers have ploughed money into growing online pureplays. In the past two years we have seen: LVMH-backed private equity firm L Catterton purchase luxury cycle store Pinarello; True Capital – a private equity company – purchase Ribble Cycles; and Halfords purchase Wheelies and Tredz.
However, the biggest threat to Evans Cycles is the merger of the two largest cycling pureplays: Wiggle and Chain Reaction Cycles (now WiggleCRC). The merger will double WiggleCRC’s revenue and combine both retailers’ expertise and product ranges. Evans Cycles needs to react quickly or risk losing market share.
Evans Cycles needs to better serve its customers
Data collected from GlobalData’s How Britain Shops survey of 10,000 respondents shows that visitors to Evan’s stores are the least likely to make a purchase out of the UK’s four largest cycling players. Alongside this, the retailer’s customers are the least loyal, with only 28.6% claiming to frequently shop at Evans Cycles compared to nearly half of Wiggle’s customers being frequent shoppers.
Evans needs to create a USP to develop loyalty and improve conversion rates. Improving its reputation among the cycling community is essential – and Evans could do this with exceptional customer service – something that, without stores, pureplays will struggle to replicate. Evans has made some headway in this area already with fortnightly FIX IT events that allow customers to learn how to take better care of their bikes.
But to really stand out, Evans needs to improve its insurance offer so that it includes the cost of repairing bikes and brings the price of servicing bikes down. The retailer should also lower the cost of individual bike repairs to those that don’t have insurance so that it becomes more competitive against independents and Halfords.