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Bike Industry and Marketing

In: Other Topics

Submitted By sashaamore
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Executive Summary

My Bike is in a unique position to capitalize on gains from advertising campaign. Starting business in step with a downturn in the economy My Bike has shown to have the products and services customers’ desire. Specialty bike shops make up a small portion of all bike retailers but contribute 55% of the sales revenue in the biking industry. With demands for bikes and their services fairly consistent getting the message out about who My Bike is and what it can do for customer is critical to success in this market. Service, repairs and rentals differentiates its self from mass merchants while the extend adjustment period and used bike selection lets My Bike stand out among other specialty shops. Connecting and communicating with My Bikes identified target market will create awareness and draw traffic to allow for growth. Advertising each segment of products and services around a central theme generates synergy on the My Bike brand but communicates the specific value it will bring to the consumer. The synergy would be centered on the web and feed through advertising media like facebook, tweeter and shop envy sites. Targeting the right message to the right audience at the right time will allow My Bike to be successful in its goals.

I. Situation Analysis

The Bicycle Industry
In 2011 there were approximately 15.7 million bicycles sold within the US in all wheel sizes these sales, combined with the sale of related parts and accessories, represents a $6 billion dollar market.

There are five primary channels of distribution: * Specialty bicycle retailers; * Mass merchandisers (Ex: Wal-Mart, Target, Kmart); * Full-line sporting goods stores; * Outdoor specialty stores; * Other channels such as internet sales.

Sales by mass merchandisers make up approximately 70% of the units sold but only 27% of the sales revenue. The specialty bike shops make up only 18% of the bike market, but have 55% of the sales revenue. Full-line chain sporting goods stores are responsible for approximately 7% of sales and 8% of sales revenues. Outdoor specialty retailers were responsible for 2% of sales and 5% of sales revenue while the other channels resulted with 2% of sales.

Over the past decade the sales by units has stayed fairly consistent. The growth potential for the industry comes from people’s concern for their health due to cardiovascular diseases. More people are becoming health-conscious and biking is a relatively healthy cardiovascular exercise. This possibility could potentially drive sales upward.
The bicycle industry is changing year to year, most of which seems to be coming from specialty bicycle shops according to the National Bicycle Dealers Association. The specialty bicycle shops have been growing every year and producing more and more sales. The shops have been getting bigger and carrying more brands and types of bikes.

If the industry wants to grow faster than they need to start advertising and marketing the health advantages to cycling through different mediums to promote sales.
Sales throughout difficult economic times have been consistent. Overall, during the past 20 years the sales by units have been around 15-18 million units, although in 2000 the sales jumped to 20.9 million. Also from 2002-2008 the sales by unit averaged around 18.72 million units. Since then the sales have fluctuated up to almost 20 million and down to 14.9 million. Considering the specialty bike shops make up only 18% of the bike market, but have 55% of the sales revenue. This wide profit margin should be the driving force behind the need to advertise.

Figure A Supply Chain

Company

Currently My Bike’s only significant source of advertising is the use of one social media site, Facebook.com. There has been other advertising used in the past, however none are currently being utilized. Past advertising in The Beecher, a magazine produced in NW Indiana, has been successful.

Current perception of My Bike by its consumer base is that this store caters to teens and young adults involved in BMX and Skate Boarding. My Bike is currently missing the market of middle and upper class biking enthusiasts. My Bike is also missing the market of parents seeking to buy bicycles for their children who denote quality and a warranty currently unrivaled by My Bike’s competitors. Target advertising of demographic specific advertising and information is necessary to bring to light My Bike’s products and services to benefit the community and My Bike’s revenue.

No customer feedback or related information is available as My Bike does not participate in any customer relationship management related module. This aspect of tracking consumer base and information would be beneficial for My Bike. This would involve tracking demographic information about My Bike’s consumers and allow for follow up communication with consumers to apprise them of sales and upcoming My Bike events.
My Bike of Michigan City has the objective of creating a niche in the biking supply industry which will allow for brand recognition which separates them from the rest of their regional competition. The biking supply industry is considered to be any vendor of bikes or bike related merchandise and services whether in physical retail stores or online based stores. My Bike has the unique advantage of being able to custom cater to their clientele and offer them genuine service their clientele will not receive at a larger bike store. My Bike has the objective of self-sustainability through building a revenue stream which will allow them to operate and expand. Currently, the winter months prove difficult as revenue dwindles.

Through advertising to click demographics through mainstream and side stream media My Bike will saturate the region with information regarding its products and services. Once a consumer base is built and business increases My Bike will increase the size of its staff to accommodate as well as manage inventory to be more efficient. Currently, the customers are not walking through the door buying items which generate sufficient revenue. My Bike’s strategy is to increase this through an intensive marketing campaign pinpointing demographics with tailored media that is information, intelligent, and fun.

My Bike currently has the capability to offer tailored services which its competitors are not. The staff is willing to take on custom fabrication projects in the winter which differentiates My Bike from its competitors. Limited inventory space restricts the walk-in shopper from shelf-shopping for a brand new bike; however, My Bike has the capability to custom order a bike which meets specific needs while being knowledgeable enough to make recommendations to upgrade the bike. My Bike has a great used bike selection that includes servicing and a guarantee which would not normally come with a used bike. My Bike offers a one year warranty whereas his competitors offer a six month warranty and My Bike does adjustments through a service guarantee which last ninety days. My Bike has an 800 square foot show area with an additional work area for its employees to service and repair bicycles. My Bike has bicycles which range from $50 for a used bicycle to over $3000 for a road bike which is used by the serious enthusiast. My Bike has gained some national recognition garnered through sponsoring and vending at events BMX events. Currently, 75% of revenue comes through bicycle repairs while My Bike has the capability to transfer that 75% to new and used bicycle sales through intensive advertising and target market selection. My Bike has a unique logo and can create brand recognition through association tactics.

Product/Services
Product Line: * Types of New Bicycles * Road Bikes * BMX Bikes * Cruiser Bikes * Casual Bikes * Skateboards * Bicycle accessories * Used Bicycles * Biking Attire * Biking Safety Gear
Services:
* Repair of Bicycles * Routine Servicing of Bicycles * Building of Custom Design of Bicycles * Assistance in Recommending Proper Bike and Biking Gear * Consultation * Sponsorship

My Bike of Michigan City may be small, but this can be used to its advantage. Larger bike shops, such as Bike Stop Cycling and Fitness, are not able to provide the custom one on one serving. My Bike has a longer warranty and servicing guarantee on its sold bicycles than its regional competitors. My Bike has a personalized family atmosphere within its shop that its competitors do not have. My Bike also has greater access to a wider selection and variety of ordered bicycles than its competitors are willing to engage. My Bike is the only shop found within a 200 mile radius which is willing to custom fabricate a unique bicycle design – which has many applications.

Sales
My Bike sales are divided up into separate categories.
At My Bike, 75% of revenue is derived from repairs on bikes. Repairs are a very large part of his shop because of several factors: the relationship with returning customers, the one-year warranty on new bikes, and the sales of repair parts (tubes, chains, grips, etc.). Skateboards generate the lowest sales at less than 5%.
New and used sales in bikes should be more of My Bikes total sales, because in my opinion the revenue increase can develop much quicker. The problem is that the sale of new bikes is a very competitive market. The market is competitive on new bike sales for My Bike because the competition in the area has the capabilities of having larger inventory. Used sales could be one of the best areas to have focus on because of how large the profit margin is. My Bike doesn’t advertise this very well but if it were to be, it could turn out to very profitable for My Bike.
Bike rentals is another area of revenue that needs to be capitalized on due to the demand of beach cruisers, kids bikes, and maybe even specialty bikes in the beach front region. In my opinion this could make up for 25% of any sales deficits with in the company due to the amount of the areas summer tourism, which is growing, especially in the water front region.
For the off-season (Oct-April) restoration and custom bike building would be a good way to make up for lost sales during the down months for the business. Restoration has low overhead and opens doors for good profit. Custom bikes could offer 30% of specialty revenue for My Bike in this part of the year, according to the owner.

Market Share

Following is a market share breakdown of the main bike retailers in the Michigan City area (Trail Creek and Long Beach inclusive). As competition for My Bike there are two major businesses, The Bike Stop Cycling, and the Category, “Other” which includes national chains such as Wal-Mart, Meijer, Target etc.
The following statistics from the My Bike store have been rounded and averaged for purposes of this report. The My Bike store is about 800 sq. ft., and it has approximate sales of 500 bikes per year, with an average inventory of about 100 bikes.
500 bikes per year sold100 Avg. Inventory=Inventory Turnover of 5
800 sq. Ft. store100 Bikes avg. inventory=8sq. ft. per bike
The statistics for The Bike Stop Cycling are as listed below. My Bike’s closest geographic competitor is The Bike Stop Cycling, which has an overall building size of about 5000sq. ft. Of that space, there is an approximate service/ work area of about 1000sq. ft., leaving a showroom floor of 4000sq. ft. The average sales figure is also about 4000 bikes per year.
4000 sq. ft. showroom8 sq. ft. per bike (from Above Calculation)=500 average Inventory
4000 Bikes sold per year500 Avg Inventory=Inventory Turnover of 8
To establish the size of the potential market for My Bike, the following demographics are provided. The population statistics for Michigan City, Trail Creek, and Long Beach have a combined total of 34,630 people, according to the 2011 U. S. Censes website. Additionally, research reveals that people usually purchase a new bike roughly every 4-6 years, with six years being the most probable.

34,630 People4 Years=8590 Bikes sold Annually (Too High)
34,630 People6 Years=5772 Bikes sold Annually (More Realistic)

Rounding off the number from the six year new -bike purchasing figure to 5750, this is the number of potential consumers each bike store has for their target geographic area.
With an overall estimate of 5750 bikes sold every year, we can conclude that there are approximately 1250 bikes that are sold at locations other than My Bike or The Bike Stop Cycling, such as Wal-Mart, Target, Meijer, etc.

5750 Rounded-My Bike sales500 bikes-Bike Stop Sales =1250 bikes sold in "Other"

In terms of actual market shares we will take the overall sales of each of the three categories, and divide it by the total bike sales giving us the overall market share for each entity.

500 Bikes sold at Mybike5750 Total bikes sold in area=8.7% market share

1250 Bikes sold at "Other"5750 Total Bikes sold in area=21.73% Market share

4000 Bikes sold at Bike Stop5750 Total Bikes sold in area=69.57% Market Share
8.7% + 21.73% + 69.57% = 100% Market share

Target Market/Audience
Overall Market of Michigan City, Indiana

The following is taken from the 2011 United States Census demographic statistics of Michigan City, Trail Creek, and Long Beach, Indiana. Together the total population is 34,630. The total number of people under 18 years old is 23.5%. 56.1% of the population falls between 18 and 65 years old. Breakdown of ethnicities: White, 64.9%, Black, 28.1%, & Hispanic/Latino, 5.9%. Michigan City’s median housing value of only $91,600 and only has a median household income of $35,433. The per capita income of only $18,315 means that most residents are middle to lower class and probably do not have the discretionary income to purchase road bikes. Bike Stop already maintains the road bike segment but doesn’t focus on repairs which are one of My Bike’s competitive advantages. 22% of Michigan City’s population is below the poverty level. However, Michigan City boasts 1607 people per square mile. There are 2.34 people per household as of 2011. 2,045 firms in Michigan City generated $730,078 in revenue in 2007. Accommodation and food service sales made up $313,938 of that total. With this statistic, bed and breakfast rental and advertisements towards the tourist segment could help boost current sales or generate new ones. Overall Market of LaPorte County, Indiana

The following is taken from the 2011 United States Census demographic statistics of LaPorte County, Indiana. LaPorte County had a total population of 111,374. The total number of people under 18 years old is 22.4%. 57.1% of the population falls between 18 and 65 years old. Breakdown of ethnicities: White, 86.2%, 22% higher than Michigan City’s numbers, Black, 10.9%, dramatically lower than Michigan City, and Hispanic/Latino, 5.6%, similar to that of Michigan City. LaPorte County’s median housing value is $119,800 with a median household income of $46,019. It has a per capita income of $22,599 which also means that most residents are still in the middle to lower class and probably do not have the income to support the addition of road bikes to the product portfolio unless My Bike keeps a select few in-stock. Bike Stop already controls the road bike segment but doesn’t focus on repairs which are one of My Bike’s competitive advantages. As a whole, just 13.8% of LaPorte County’s population is below the poverty level which is close to the state average of13.5%. LaPorte County only has an average of 186.3 people per square mile. There are 2.46 people per household as of 2011. The 7,314 firms in LaPorte County, they generated $1,363,592 in revenue in 2007. Accommodation and food service sales made up $389,663 of that total. This statistic shows that Michigan City generates most of the revenues in retail and accommodation and food service sales for LaPorte County.

Bike Rental Segment

My Bike should target tourists during the summer months. My Bike could partner with Bed and Breakfasts in the local area to either rent out or sell to and repair bikes. It could also partner with Michigan City to sanction events and to promote rentals at these events, place pamphlets at tourist/welcome centers in the area including the rest area on I-94 near New Buffalo, Michigan, Marquette Mall in Michigan City, and the two casinos in the area. This should be part of the spring/summer advertising campaign.

Used Bike Segment

This segment should be targeted to the lower class consumers with incomes levels at or around the poverty level to middle-class consumers with moderate incomes. Due to the current amount of used bike sales experienced by My Bike, there appears to be a large demand, high profit margin, and fits the middle and lower class demographic of Michigan City extremely well. My Bike currently has about 30% of sales coming from the used bikes segment, therefore, this product should be one of the main advertising messages produced in the spring and summer months. Bike Restoration Segment

Middle-aged and older consumers (30-60+) and middle-class and upper-class consumers should be targeted for this service. They have more disposable income, prefer quality made products, and oftentimes have antique bikes that they have a personal connection with and want to repair for nostalgic and/or economic reasons. With the amount of down time in the fall and winter months, bike restorations could become a primary product segment during this time. My Bike can be better utilized operating this way because the fixed costs are already in place while My Bike faces the dilemma of customer traffic slowing due to the seasonal aspect of biking. This should be the main advertising focus during the fall and winter months.

New Bike Segment

This segment should target young adults – middle-aged consumers (18-50). According to the National Bicycle Dealers Association, mountain, hybrid and cruiser bikes account for a total of 49% of all new bike purchases nationwide in 2011, making this a potentially lucrative market for My Bike. One suggestion is to offer a trade-in incentive for customers to trade in an older model and receive a discount on their newer model based on the condition of the trade-in. This product should be one of the main advertising messages produced in the spring and summer months with a focus on the best sellers with the highest profit margins.

Service and Bike Accessories Segment

Current used bike owners who want to fix a bike rather than purchase a brand new one and new bike customers who are looking for add-ons are the target market for accessories. Add-ons could be placed by the register or even suggested before finalizing the purchase (ex. helmet, water bottle, mirrors, and lights). The advertisements must mention that My Bike does all repairs and adjustments on a new bike purchase free for one year. Advertisements could also target accessories with high profit margins or best sellers. Add-ons are a key selling point for My Bike especially during bike purchases and could become a major profit generator if the right products are displayed. These should also be considered for a placement at the point of sale and on the focal wall around the register. If advertised, it should be done from spring through fall and could be used in collaboration with the new and used bike advertisements.

Skateboard and BMX Bike Segment:

This segment should target the teen – young adult category (13-25). Since this segment is relatively small, it should be considered as the lowest priority when it comes to inclusion in any advertising campaigns.

Pricing

In determining the pricing strategy for My Bike, the key factor to consider is the primary target market, which consists of lower to middle-class consumers. Because of low to moderate incomes of local customers, the primary deciding factor for product and service pricing is based on offering high value to customers with a price they can afford. The markup on bikes is 30-40% and for accessories 40-50%. The price range for in-store bikes is $50 to over $3,000, depending on the quality of bike purchased. Accessories range anywhere from $14 for a pair of handlebar grips to $189 for a pair of BMX wheels.

When purchasing a new bike from My Bike, the consumer is given one full year of service at no charge. The cost to the shop for the year of free service offered with all new bikes is slightly factored into the price of the bike. The consumer has the option of paying via cash, check, and credit card. Coupons and special offers also help to draw in both new and frequent customers.

Along with the bike lines and accessories, My Bike offers maintenance and repair on all new and used bikes. The service sector of the business does not draw as much of a profit margin as the product lines, but is a critical part of the business. My Bike also offers bike rentals along with custom bike building and bike restoration in the off-season (October-April). These sectors could be greatly capitalized on and make up for sales deficits within the retail and service sector.

Distribution

My Bike, as with most retail businesses, relies on the physical retail shop for its primary means of distribution and a direct sales channel form of distribution. The brick-and-mortar store sells directly to local consumers within LaPorte County, Indiana (with a future focus to include New Buffalo, Michigan). Advertising and promotional efforts can help to attract the customer but ultimately there is no way of controlling the number of customers that frequent My Bike. What is controllable is how the sales staff treats the customer once they walk through the door. Exceptional customer service and knowledgeable interaction is critical to keeping the customer loyal to My Bike.

While some inventory is maintained on site, My Bike also submits customer orders via telephone and the internet to multiple remote distribution centers. As a secondary distribution approach, vendor catalogs are available to the consumer for special orders on most bike lines. Shipments can be made next day and My Bike does not pass along shipment charges to the buyer.

Website Recommendation

My Bike needs a website to serve as a marketing medium. Currently a My Bike Facebook is maintained, however the Facebook platform should be geared toward feeding content and engaging customers. By growing its fan base on Facebook, My Bike can create a following which will lead to My Bike’s new website presence. In turn, ‘fans’ will become ‘customers’ who then promote the brand to others; those ‘others’ become ‘fans’ and so on and so forth.

My Bike's website is designed to be a content site with an immediate target market. Consumers are within cycling and walking distance of the shop, so the site should provide locally topical information to them. Wordpress website hosting for the design and upkeep of the site and BlueHost for website hosting is recommended.

The website will need to house static information, such as store information: hours, location, phone number, brands sold, etc. Sales and current promotions will also be featured.

On the website, My Bike can also offer downloadable maps of the city bike routes, maps of rides outside the city area, give information about the store, and announce sales. It is believed that cyclists will regularly access the site for the valuable information provided, also reinforcing their awareness of My Bike.

The goals of the website are: to attract customers and sales; allow My Bike to show its product catalog more efficiently and in an organized fashion; to serve as a place for people to get questions answered 24/7 (and even advice and tips); and to work as a virtual storefront.

Competition

The majority of My Bike’s competition comes locally from The Bike Stop on Hwy. 20 of Michigan City. The Bike Stop sells cruisers, road bikes, BMX, children’s bikes, accessories, and apparel and is significantly larger than the My Bike store (5,000 sq. ft vs. 800 sq. ft). The Bike Stop sells a lot of road bikes, which have a much higher profit margin than the majority of bikes sold for My Bike. The highway location of The Bike Stop has a higher volume of traffic, more of a likelihood of out-of-town traffic, and has greater store visibility from the road. My Bike’s downtown location has a fair amount of local traffic, but is hidden approximately 25 ft. back from the road in between other larger buildings.

Other competitors for My Bike is from the Michigan City WalMart and Meijer’s stores, mainly, as relates to the sale of children’s bikes. Since the bike store in New Buffalo, MI closed, a portion of that market was acquired by My Bike.

Promotion & Advertising

The only major promotion My Bike currently offers is maintaining a constant “Buy a new bike, get repairs free for a year” promotion. Most bike retailers, including The Bike Stop, only offer repairs on a new bike free for 30 days. All other promotions for My Bike are on a very small scale, sometimes consisting only of Facebook advertisements and sales. In 2011, My Bike ran a discounted flat-rate sale on all blank (no-graphic) skateboards, which included the skateboard grip-tape. This sale price was $20 dollars (approximately $15 off), and this promotion lasted a few weeks. According to the owner of My Bike, this sale was not successful.

Another current promotion for the My Bike shop is involvement as a sponsor for the annual Michigan City skate park competitions. My Bike generally has a van on-site at the competition, and gives away apparel, gear, and runs a small sale. The owner of My Bike says that he almost never gets any purchases at the competitions and that his involvement is almost entirely promotional. My Bike also donates bike racks to some businesses(the racks cost My Bike approximately $50 each), hands out promotional fliers, sells and gives away My Bike t-shirts, and maintains a Facebook page. My Bike's owner believes that word-of-mouth is the most effective advertising for the business.

Previous advertising for My Bike has been through two Michigan City radio stations, WEFM and WIMS, and one run in the local Beacher newspaper, a free weekly newspaper distributed in the Michigan City, Indiana area.

SWOT Analysis
Strengths
* Selection of Used Bikes * Always has a selection of used quality bikes that have been serviced and ready to ride that generate a high profit. * Location near beach * Closest bike shop near the beach within the city not on a major highway. * Customize bikes to buyers tastes * Able to order components per customers’ requests and build a bike. * Fabrication & Restoration * Ability to weld and fabricate bikes.
Weaknesses
* Store Floor Space * Only 800 square feet to display products. Can display bikes outside but when it rains bikes brought back in and no room to walk in store. * Repair Space * Very small work space, allowing only one staff member to work. * Lack of Buying Power * Low turnover of new product limits ability to get discounts and payment terms from manufacturers. * Doesn’t advertise rental services * Does not advertise rental service. * Little selection of Road Bikes * Money can’t be tied up in high dollar product inventory.
Opportunities
* Tourist coming to the region * Indiana Dunes National Lake Shore Park and Indiana Dunes State Park brings many people into the region. * Old bikes sitting in peoples sheds/garages * Bikes have been around for over 100 years. Collectors would love to have classics restored to like- new condition. * Customers looking for unique products * People want to make a statement about themselves and have products tailored to their needs and wants. * Products related to beach activities * Pull behind grills, shad tents, Frisbee, dog leashes, etc.
Threats
* Bike Stop’s size and selection * Much bigger selection of bikes and buying power * Lower income clients * More low -cost bikes required to be in stock. * Zumiez’s national brand and selection * Taken 95% of skateboard business, even though My Bike offers lower price.

II. BIG IDEA FOR CAMPAIGN The “big idea” slogan pitch mentioned in the above section will be used to address each specific segment (ie. New, used, rental, service). For example, when addressing the rental segment; rental is identified as the segment, the demographic could be low-income customers in Michigan City, the mediums of advertisements could range from print to radio, and each advertisement would follow the “big idea” slogan pitch format of “What is your bike? –Buy one at My Bike”. Each segment being addressed would have specific demographics, involved mediums, but all would follow the uniform slogan pitch.

III. CREATIVE STRATEGY
Slogan Formatting for Multiple Segments The My Bike Advertising Campaign Group has developed a standardized slogan pitch that can be altered to fit each segment/product line. This uniform slogan format will provide an easy to understand concept, individualized segment recognition, all while working together by maintaining continuity to help the overall branding of the My Bike shop.
“New & Used” Segment
“What is your bike? -Buy one at My Bike”

“Repair” Segment
“Broke your bike? -Fix it at My Bike”

“Rental” Segment
“Didn’t bring your bike? -Rent one at My Bike”
This “big idea” slogan pitch can be used to develop the core of each advertisement in the following creative strategy section.

Creative Strategy – Rentals

My Bike offers bike rentals to customers looking for a way to see more of the town or beach front. Currently there are no advertisements informing potential renters of this service. Advertising dollars spent notifying customers about this service will be easily measurable based on the increase in revenue in this service. Michigan City and the surrounding region offers unique experiences for visitors, who currently spend annually $312 million dollars in the area (http://www.indianadunes.com/ad-sales/). Giving visitors more unique experiences with a bike ride rented from My Bike is the goal.
Banner advertisements on indianadues.com would take place during peak tourist activity from the months of May through September. The rental message of My Bike is best served in media directed to visitors.
Indianadunes.com caters directly to visitors and promotes attractions and the local scene to travelers of the region. This would expose My Bike to tens of thousands of visitors who plan their visit to the region and build it into their plan to rent a bike.
The message to visitors is to “Experience the region uniquely on My Bike”. We offer bicycle rental for the whole family to experience the region in a different way – visit our website to find out how to reserve My Bike’s today!
Building on these rental services, renting bicycles for the season to area vacation rentals may also be considered as a way to build brand recognition and revenue for My Bike. Advertising that bicycles are available for use by the vacation rental company as an additional activity would be a great way to gain additional exposure for My Bike and a co-branding opportunity for the vacation rental companies. Leasing packages would include My Bike’s logo in advertising materials when offered to their renters. The following is a list of local vacation rental companies as potential targets:

Sweethaven ResortUnion Pier, MIwww.sweethavenresort.com | Lake Country InnNew Buffalo, MI | Bluefish Vacation Rentalswww.bluefishvacations.com | Yellow Bird VacationsMichiganwww.yellowbirdvacations |

Creative Strategy – Service
My Bike offers its bike services to consumers who are trying to repair a bike, or add on to new and existing bikes. Current advertisements do not mention anything about the service segment. Even if My Bike don’t set a specific advertisement strategy for service, you should definitely mention the service segment in the general business description on websites and general advertisements that are currently running. My Bike can track the profitability of these ads by checking the amount of services performed the previous years to the new ad promoted segment.
The service campaign could use a slogan such as, “Need a chain, new tire, or any other part? Come get one from My Bike!” or “I can fix your bike to ride like My Bike’s…” Another ad slogan could be “Come to My Bike to receive quality service and repairs to your bike like I would on My Bike.” Make sure to reference websites or social media sites to gain more exposure.

NEED CREATIVE STRATEGY-NEW BIKE/ USED SEGMENT/ FABRICATION
FABRICATION- RICHARD
Creative Strategy – New

My Bike is positioned uniquely within the cycling industry to provide consumers with a new product that is accompanied by service guarantee and a warranty that exceeds his local competitors. This ad campaign will allow My Bike to create brand recognition through target market advertising of its products and services. The new products being sold by My Bike are not limited to those within its 800 square foot showroom. My Bike will market its online resource of ordering directly from manufacturers combined with the owner’s vast knowledge and experience in the cycling industry will provide the consumer with a tailored shopping experience they might not find at another cycling retailer. The owner has a sincere passion for cycling and providing his customers with excellent service and stands behind his products. This is a marketable trait as large retailers such as Walmart offer very little in the consultation and service of cycling. Selling new products in what could be considered a boutique shop in comparison to large retailers will be marketed so that the consumer will be drawn in to purchase their new cycling product at My Bike because My Bike will be able to assert full knowledge and advice about cycling and the cycling industry. This ad campaign will instruct My Bike how to integrate the brand name “My Bike” and the My Bike logo into its marketing feeds for new products. New bicycle sales has the potential to be at the forefront of product sales and services in regards to revenue provided.

Creative Strategy- Used
My Bike has the unique ability to offer used bikes for sale after taken in on trade and serviced. As mentioned in the SWOT the used bike segment is a huge advantage that My Bike edges out competition with. Referencing statistics stated in target market we know that the demand for a good quality used bike is quite high.
In offering a quality used bicycle the opportunity to present My bikes quality of workmanship is also shown. My bike really puts an emphasis on doing things right the first time. Offering the ability to get a quality used bike will bring in a different type of foot traffic that competitors can’t cater to.
By targeting those lower income households and giving them a quality product backed by superior service will prove to be beneficial to not only the bottom line but also in the form of returning loyal customer base. With little advertising for the used bike segment currently, it is important to not overlook assumptions that ads in the Beacher will really reach a desirable amount of potential customers for the used segment. The Beacher typically is distributed in the long beach area, therefore not quite the lower level income target audience.
In store advertising and website ads will be effective because people look to the Internet for everything.

Budget

| Quarterly Advertising Budget | | | Quarter 1 | Quarter 2 | Quarter 3 | Quarter 4 | | Advertising | Expenses | Expenses | Expenses | Expenses | | Website* | 21 | 21 | 21 | 21 | | Indiana Dunes Banner Ad | | 350 | 350 | | | Print: The Beacher | | | | | | Totals | $21 | $371 | $371 | $21 | | | | | | | | *$6.95/month for 12 months package | | | |

Website

The Wordpress hosted online website platform is free to operate. To own a domain name (i.e. My Bikeofmichigancity.com) with a .com, .org, or .net. URL, the cost is $18/year. If My Bike chooses not to purchase a domain name, their domain will appear as ‘www.MyBikeofMC.wordpress.com’. My Bike will also need to purchase hosting services for the website to store website files. Hosting services range from $3.50-12.95/month.

Our recommendation is that My Bike purchases hosting services through Bluehost, the #1 Hosting Service by many reviews and can integrate completely and easily with Wordpress. Bluehost offers a personal domain name that specifically integrates with the Wordpress platform. Package pricing ranges from $4.95/month for 36 months to $6.95/month for 12 months. Every package includes unlimited email addresses, space and bandwidth (for photos, documents and other uploaded material), no advertisements and a custom design with a money-back guarantee. Also included is a $100 Google advertising credit that does not expire. My Bike can also purchase site templates for $1075/template (to retain brand image and customize site). Many free templates are also available.

Online Storefront

The Storenvy hosted online storefront is free to operate. My Bike will be able to sell and advertise without incurring any costs. Storenvy does however offer a domain subscription for $4.99/month. This would allow My Bike to have the domain www.MyBikeofMC.com (for example), rather than the somewhat unappealing MyBikeofmc.storenvy.com. This is fee would be optional, based on My Bike’s decision to purchase a domain subscription or not; the store is still free to operate. To surpass the $4.99/month charge, Wordpress contains a ‘plugin’ (free downloadable software) that can build a Storenvy storefront right into the Wordpress website.

Print/Other

Online advertising “Banner Ad” with graphics (in rotation) on indianadunes.com costs $350 quarterly.
Online and print advertising through The Beacher ranges from $34-$200 based on size of ad. Discount rates can be applied if you advertise 4 consecutive weekly or bi-weekly ads ranging from $25.50-$185.50. Bi-weekly mid-sized ads at the discount rate may be the best option. You may be able to talk to them and see if they would also discount for a bundle of advertisements such as 3 different ad segments at a time.

Testing

Testing the effectiveness of each advertisement can be done through an official website. Each advertisement that is ran can have a tracking/promotional code that is unique to the medium it is being advertised in. For example, if there is an ad ran in The Beacher, the ad can state “Enter in promotional code: TB01 on our website to claim your discount.” Each medium would have its own unique code. The My Bike website could have a page for discounts where visitors are prompted to enter in a promotional code to claim a discount. As each code that is entered into the website is specific to the medium it is being advertised in, it would be possible to measure the engagement of each medium being advertised. For example, if the code from The Beacher advertisement is being entered into the website 20 times in one month, whereas the code for an advertisement in The Michiana Entertainer is only being entered in 2 times in one month, it is clear that the advertisement in The Beacher is driving much more consumer engagement, and changes can then be effectively made for the next run of an advertising campaign.

Evaluation

Increase in :
Rental
Foot traffic
Website traffic…...

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