3.2 Products and distribution
We see our strong development and design competencies as one of our major strengths in the fight to win over consumers. Surprising bicycle-related innovations – both small and large - are driving the success of our brands, especially our high-end brands. The safety of bicycles as products and the responsible use of bicycles in traffic and other environments also play a significant role in the design of our bicycle collections. The marketing, distribution and sale of bicycles and bicycle parts and accessories have very specific characteristics. It is that part of our value chain in particular that is changing quite rapidly.
Innovation and design
Our development and design teams work for our brands and are constantly on the look-out for the latest developments in the field of design and innovation. This includes trends in design and colours, the use of new sustainable materials, the use of certain materials to reduce weight, improve handling and extend life. But also improved techniques for comfort, propulsion and safety, or digital options that add value for consumers in terms of functionality and cycling experience. We protect our own applied innovations as much as possible by taking out international patents and design protections. Accell Group currently has more than 50 patents and design protections in its patents portfolio.
Munich Design Center - A major draw for creative talents
In 2016, Haibike opened a new design centre in Munich. Susanne Puello of Haibike explains why: “We opted for Munich because it is one of Europe’s trendsetting design and media hotspots. We are also surrounded by a large pool of top talents and creative networks. So it’s a very inspiring spot and at the same time an excellent base for bike markets in Austria, Switzerland and Italy. Our top designers are working on the latest Haibike models in the Design Center. The design team have already launched the successful Haibike e-performance lines ‘XDURO’ and ‘SDURO’. Together with the engineers in the head office in Schweinfurt, they are already working on the bicycle of the future.”
No compromises on safety
All our products are made of high-quality materials. Every product meets the highest international safety standards, such as those laid down in ISO (World), ASTM (USA), EN (Europe) and the IEC standards for electric components. In 2016, we appointed a Technical Compliance Officer at group level to make sure these processes are embedded even more deeply in our organisation. Several times a year, we organise and facilitate internal know-how sessions for our product developers to exchange best practices related to quality and safety standards.
E-bike and e-performance
We focus our innovative strength primarily on e-bikes and sports bikes. E-bikes in particular have a great deal of development potential, due to the universal nature of this type of bicycle and the ever-improving and increasingly smart propulsion technology. This means the e-bike has the potential to generate added value in multiple segments and for a wide range of applications.
One example of this is the Speed Pedelec, an electric bike that provides pedal assistance up to a maximum of 45 km/h. It takes a serious amount of active peddling to achieve that top speed. The cruising speed is around 35-38 km/h. This speed makes the Speed Pedelec extremely useful for middle distances, which makes it a serious alternative to the car.
Another example is the e-performance (mountain)bike we have launched in the market for sporty and sports bikes. Our Haibike brand was the first in the world to introduce an e-performance bike, with a lot of success. The product met a clear demand from consumers and it has made Haibike the undisputed market leader in this e-bike sport segment. We continued to develop the bike in 2016. For instance, we teamed up with a supplier to apply the use of gravity casting to e-performance bikes. This technology, derived from the motorbike industry, makes it possible to produce aluminium frames complete with seamlessly integrated motors.
On the sports bikes front, we are constantly working on major improvements in fields such as aerodynamics, frames, front forks and suspension systems for racing bikes, time trial bikes, track bikes, MTBs and downhill bikes.
No-holds-barred triathlon bike
The Andean is a great example of the sheer craftsmanship of Diamondback’s design team. Their ambition was to build the ultimate triathlon bicycle. Wind tunnel test results revealed they have delivered a potential winner. The horizontal wing shape of the carbon frame pushes the airflow backwards in a straight line. The superior aerodynamics reduces resistance to a bare minimum. And on the advice of professional triathletes, the designers fitted a special holder for energy bars and drinks bottles right on the handlebar stem. After all, every second counts when you’re in a race.
In the year under review, we also worked on the further integration of components that were previously added to bikes as loose components, such as lighting, motors and batteries. The technical possibilities for the integration of these components in the bicycle are constantly improving and we are introducing this design principle in more and more of our models. The fact that virtually everyone has a smartphone these days creates all kinds of new opportunities that are converging in what we see as the bicycle of the future: the connected bike.
Protanium has been one of our strategic development partners in the field of new e-bike concepts and services since 2016. We teamed up with Protanium to develop the Deliver Ebike and a concept for this delivery service for one of our clients. The connected e-bike offers a cost-saving, sustainable and an innovative solution for the delivery of meals and parcels. Big brands such as Domino’s Pizza, Burger King and Delivery Hero have all acquired the bike. The electric bike is unrivalled over short distances. And in bigger cities it is faster than rival methods over longer distances, too. The parts have been deliberately selected or specifically designed and built to ensure that the Deliver Ebike can carry out its delivery tasks perfectly. And the use of parts from top brands ensures that the delivery bike is solid, safe and durable.
We are teaming up with suppliers and other partners to invest in the development of the connected bike. We launched various connected bike pilots in 2016 and some models, like the Sparta M8i, have already been launched on the market.
Connectivity goes beyond creating opportunities at the level of the bicycle as a product, as it also creates opportunities for new use-oriented mobility solutions and revenue models. To explore those opportunities, we are developing new mobility-as-a-service solutions, often together with partners. These might include concepts such as the lease bike for commuter travel, rental concepts in combination with cars, mobile bike shops and the delivery of a multitude of products in urban areas.
With a view to the growing mobility problems in urban areas, we are actively cooperating with local authorities, municipalities and mobility service providers to create new integrated solutions that help provide better access to cities, reduce traffic congestion and cut air pollution. By creating and offering all these innovative mobility solutions, we are responding to a shift in consumer demand away from ownership towards use.
Marketing, distribution and sales
We have a multi-brand strategy, because the bicycle market for consumers varies greatly from country to country in terms of type and style preference, price perception and distribution method. In every country, we combine one or more nationally strong brands with international (sports) brands, while constantly targeting optimisation of the brand positioning and complementarity between the brands, parts and accessories. Consciously supplying multiple brands and therefore a broad range of products with plenty of choice also puts us in an excellent position for the omni-channel approach. And our ability to provide parts and accessories at the same time, also via our own brand, makes that position even stronger.
Sparta, innovator for more than 100 years.
In 2017, Sparta celebrates its 100th anniversary. Sparta is one of the oldest and most beautiful bicycle brands in the Netherlands. Generations have grown up with products made by this trendsetting brand and innovations that have been picked up around the globe. Thanks to its focus on technology, Sparta became the largest motorbike manufacturer in the Netherlands in the middle of the last century. It subsequently expanded its activities to include bicycles, mopeds and scooters. The company’s passion for technology became an ever richer source for new inventions and this was followed by one breakthrough after another. Memorable products include the internationally renowned mum’s bike, the SpartaMet bicycle with auxiliary motor, the Sparta Pharos (the first e-bike in the Netherlands) and, last but not least, the ION drive technology that can be built into a bike’s frame. Sparta’s ION series led to the definitive breakthrough of the e-bike.
Technology is now developing faster than ever before. One recent example was Sparta connecting the e-bike to the internet. The Sparta design teams are also in the advanced stages of developing a rear-wheel engine with integrated hub, wirelessly rechargeable batteries, new lighting concepts and whatever comes next? A self-riding bicycle? Built-in route planner? Environment-sensitive sensors? The trendsetter in innovation is primed and ready for the next 100 years.
Market research and (e-)marketing
Accell Group regularly conducts market surveys at brand, segment and country level. This research is conducted both among consumers, via consumer panels and targeted surveys, and via our intensive contacts and consultations with specialist bicycle and sports retailers. We collect and analyse data at group level and we then share significant changes in consumer behaviour, preferences and trends right across the group. On individual brand level, we devise the most appropriate market strategy for each country in which that brand is sold, and translate that strategy into carefully tailored media campaigns. Accell Group’s marketing campaigns are increasingly aimed directly at consumers and follow the consumer through the various stages of their customer journey. Given that more and more consumers conduct their early explorations online these days, it is vital that our brands can also forge that relationship with consumers online. In 2016, we created the position of Group Director marketing. This director is responsible for the positioning of our individual brands and for the overall portfolio management per brand, segment and country. One key aspect of their role is the joint development and exchange of best practices across the group.
The connected bike is no longer pure science fiction. In 2017, no less than 10,000 Sparta e-bikes will be connected to the internet. We are also making great progress with our other brands. Product developers are working to make connections between the e-bike, smartphone apps and the internet. This opens a gateway to a host of potential future applications:
- Users can gain access to information on routes travelled, average speeds, local weather & traffic, health and performance data.
- Owners can track the bike’s location remotely and receive a notification if their bike is moved or falls over.
- The location of rental, loan or company bikes can be tracked remotely.
- Users can receive offers of personalised products and services (maintenance warnings for instance) on the basis of the bike’s use.
Big data analysis allows us to constantly gain new insights into ways to align our products even more closely to how bicycles are used.
Sponsoring remains an important marketing tool, especially for our international bicycle brands. Brands such as Koga, Lapierre, Ghost, Haibike, Diamondback and Raleigh are all highly visible at major international cycling events in Europe and North America. In addition, several of these brands sponsor professional teams that compete at the highest levels. With their performances, these teams not only act as ambassadors for the brands; they also promote cycling sports and inspire young people to take up sports. For our nationally active bicycle brands, we focus our sponsoring efforts on local initiatives.
Omni-channel in partnership with the retail trade
In line with our long term vision and ambition, our sales and distribution strategy is focused on consumers. What this means in effect is that we supply our products and services in a way that best meets the purchasing preferences of individual consumers. We will develop the omni-channel approach required to meet those preferences in close cooperation with our specialist retail network. We see a central role for our retail specialists in this and will therefore help them to set up this platform. This is a long-term evolution and we have already taken steps along this path in the past, and will continue to take new steps in the years ahead. All our brands, both in bicycles and in parts and accessories, already have their own online platforms. These focus primarily on promoting collections, providing information and increasing the ease of purchase. In addition, we are devoting considerable attention to continuously training for our retail specialists. After all, they need to know exactly how our products work and need to be up to date on every last detail. In the United Kingdom, for instance, we are already doing this via workshops and training courses. Last year, we opened a special showroom for this purpose at the Raleigh head office in Nottingham.
We currently have a multitude of local initiatives and experiments running within the group in the fields of distribution and customer contacts.
- In 2016, we opened the bicycle experience centre De Fietser (the Cyclist) in the Netherlands. The centre is located in the old Enka factory in the city of Ede and is completely energy-neutral. The experience centre provides us with a unique platform and an integrated online and offline showroom where all our brands converge, where bicycle experience takes centre stage and consumers can test and order all the latest products.
- For Raleigh, we started direct online bicycle sales in the United States in 2016, as the market and type of product we sell in the U.S. are particularly suited to that approach. And of course, we can use the experiences we gain there in other markets.
- Some of our top brands have online programmes for specialties and the assembly of custom-made bicycles, such as the Koga Signature and Lapierre Ultimate.
The Cyclist in Ede
In 2016, Accell Group opened the largest bicycle experience centre in Europe. Visitors can view, test and order the new Accell Group brands from specialist retailers. The 9,000-m2 centre has the largest indoor test track in the Netherlands - at no less than 500 metres – which consumers can use to test bikes and e-bikes. There is an e-bike square, a museum with classic models from Batavus and Sparta, modern highlights and lots of other great experiences for visitors. The Cyclist is a perfect fit with Accell Group’s strategy of focusing its operations on consumers and developing its omni-channel proposition. The centre comes complete with online support. Consumers can communicate with specialist retailers interactively and arrange orders. The centre has a website with an appointment planner and other functionalities, creating a seamless connection between offline and online experience. And we can analyse the information from the data flow to optimise customer contacts and relationships.
Leadership and setting an example
Simply by selling our products, we implicitly help to make mobility more sustainable and promote a healthy lifestyle. But we want to do more than that. Our ambition is to play an active role in the promotion and engagement in a wide range of social issues in the field of clean, healthy and safe mobility solutions in cities and outlying areas. This also helps to reduce traffic flows in and around cities, cut air pollution, encourages more exercise and improves (bicycle) traffic safety.
To fulfil that role, we are members of national and international organisations, industry bodies and initiatives that specifically promote health, safety and sustainable mobility. These include the WFSGI (World Federation of Sporting Goods Industry), the ECF (European Cyclists’ Federation), various country organisations such as the RAI Vereniging (NL) and Univelo (FR) and the European umbrella organisation CONEBI. We are actively involved in these organisations and have seats on the boards and in executives of a number of these organisations. You will find a complete overview of these in paragraph 7.2 Networks and stakeholder dialogue.
Economic benefits of cycling
- The economic benefit of cycling in Europe is more than 500 billion euros a year. That is around 1,000 euros per capita in Europe.
- Cycling saves more than 190 billion euros in healthcare costs.
- Cycling has social benefits, too, such as easier integration, access to mobility and improved employability. Estimated value of 60 billion euros per year.
We want to set an example and we therefore encourage our employees to use sustainable and healthy modes of transport for their daily commute. Our ambition is for more than 50% of our employees to travel to work together and/or using a sustainable mode of transport. We consider all individual travel by car or motorised vehicle non-sustainable.
The e-bike for employees
Ghost and Accell Hunland are making e-bikes available to their employees, who are taking turns to use them for their daily commute or in their spare time. The move encourages employees to cycle and at the same time gives them a chance to increases their product know-how outside work. Following Koga’s example, Ghost and Accell Hunland have also introduced charging stations for e-bikes, immediately outside the entrance to the building. The e-bike charging stations are powered by solar panels. These initiatives have been met with enthusiasm from employees, visiting clients and the local community.
Of course, if you want to encourage bicycle use, you need to make sure that cyclists also have access to safe roads. The cycle path to our production facility in Tószeg in Hungary was extended by four kilometres back in 2015. Accell Hunland is still lobbying to have the final 2.3 kilometres of the path tarmacked, working in close cooperation with local authorities.
In 2016, 57% of our employees used sustainable modes of transport for their daily commute.
Supporting initiatives aimed at increasing exercise.
Accell Group aims to spend more than one million euro a year on local, regional and international initiatives that help to promote health and safety for consumers and encourage bicycle use across the world. We realised this target once again in 2016. In the year under review, we supported the U.S. initiative PeopleForBikes, both financially and by making our know-how and expertise available. We also supported non-profit organisations that promote the use of bicycles in developing countries, such as World Bike Relief.
Over a million euro per year for social initiatives
Encouraging awareness consumers and safety.
Providing consumers with good information is essential. We constantly strive to improve that information flow, both directly and via our retail network and both online and offline. Not just to enable consumers to make the right product choices, but also and primarily to facilitate the safe use of our products. We provide consumers with information on technical specifications, maintenance and safe and responsible use via the websites of our brands. Each product comes with an extensive manual in the language of the country in which it was sold. We provide intensive training for the retail sector and regularly provide retailers with the latest information, so they provide consumers with high-quality advice and support. In addition the information provided on our numerous websites, we are also active on social media such as Facebook, providing easy access to consumers, also for when they want to file a complaint. All our brands have complaints procedures to ensure any complaints are received and handled correctly, regardless of whether a complaint is received by email, via the consumer phone line, website, social media or via a retailer.
Winora Group DealerCenter
Winora has had a lot of success in Germany with the ‘DealerCenter’, an in-store sales system that provides digital access to the entire Winora range at specialist retailers. With or without the help of the instore specialist, the DealerCenter gives consumers immediate access to all product specifications, videos and delivery information. And ordering via the online shopping basket is simple and easy. Following the successful launch in 2015, the DealerCenter continued its advance in 2016 and around 900 specialist retailers in Germany now use the system.
Improving regulations bicycle use and environment.
We promote the interests of consumers and the bicycle industry. Together with a number of other parties, we advocate safe cycling conditions and improved cycling infrastructure on an international level. For instance, under the CONEBI umbrella we are discussing effective regulations for the Speed Pedelec. Together with the industry as a whole, last year we took the initiative to develop a new standard for bicycle helmets that is close to ordinary city bicycle helmets in terms of design, but also provides the added safety needed for the higher speeds of the Speed Pedelec. In the Netherlands, the new bicycle helmet has already been accepted as an alternative to motorbike helmets. We expect other countries to follow this example.
The Speed Pedelec example illustrates that existing regulations and legislation often lag innovations in the bicycle industry. That is another reason why Accell plays a leadership role in improving the alignment of innovation and regulations and legislation.
V-light enhances visibility Koga e-bikes
Last year Koga, one of our premium brands, introduced the V-light for e-bikes, a form of innovative lighting technology. V-light creates a safety zone around the bike by projecting two bright laser beams onto the road in a V-shape. Research shows that e-bikes with V-light are 2.4 times more visible in the dark for traffic coming from the rear. V-light will be integrated in the ION system for Koga e-bikes.