Why Interbike is in September. In Las Vegas. Pt. II

IMG_0587The immense crowd at ‘Cross Vegas

But Doesn’t Interbike Need Trek and Specialized (and Now Cannondale and Felt) to Survive? The Critical Mass Theory.

A lot of industry observers, including me, have despaired for the future of Interbike without some of the industry’s most powerful players on hand. (To be fair, Specialized has maintained a good-faith presence at the show for a number of years, and used that presence to their advantage this year to showcase their Globe line).

Well, those  observers, including me, were wrong. For the first time in awhile, retailer numbers at Interbike ’09 were up.

So, Short Answer: No.

There’s plenty of retailers and retailer dollars left over, even after the big companies have taken their slice of the pie, something on the order of half the total industry budget for bikes alone and far more than that for equipment; not to mention plenty of suppliers who want those dollars. As long as those numbers maintain a kind of critical financial mass, Interbike will do just fine, thank you very much. In fact, a number of distributors prefer Interbike without the Big Guns there, because it means that much more retailer attention for themselves.

beached_whale

The Longer Answer to this question involves a complex set of dynamics I call Bike 2.0 and discuss in more detail here. This bit may be a little, ah, statistically dense for most folks, so enter at your own risk. Basically, Bike 2.0 as of 2010 is a lot like how the bike industry would have developed over the past 30 years had the Schwinn leviathan not swum onto the sandy shores of the mountain bike era and promptly collapsed, crushed under its own bone-breaking weight like a freshly beached whale.

Meanwhile, Trek and Specialized (and Giant and Felt and Cervélo and Cannondale and other companies who go the dealer show route) have reached their own equilibrium in the one-upmanship earlier-than-thou (also known as the “get-to-the-retailers’-checkbook-first”) game. Presumably they might want to show new product even earlier than late July, but they’re prevented from doing so by three reasons:

  • Shimano’s next-year prototypes aren’t available in sufficient quantities yet. And Shimano (not to mention frame factories) can’t have production protos available much sooner than late July because their own production backs up against the Asian Lunar (Chinese) New Year, a two-or-more-week rout celebrated sometime between late January and mid-February, depending. (For 2009, it started Jan 26th; for next year, not until Valentine’s Day). The holiday leaves not just factories but entire towns deserted, rather like the nations of France and Italy in the first two weeks of August each summer.
  • They can barely get retailers to show up in July by offering free airline tickets (for the high rollers, anyway) and free beer. Besides,
  • I think there’s some of big bike race scheduled that month anyway. Hard to get those expensive A-List athletes to show up much before August, anyway.

And the punchline to the early dealer presentations is this: retailers aren’t stupid. After just a couple of years being trotted around the block, they know to hold off their orders until they’ve seen everything their Alpha suppliers have to offer. And then they hold off another big chunk until Interbike anyway, just in case something better shows up.

So what’s the big driver for Trek and Specialized (and now other companies besides) to spend literal millions of collective dollars schlepping bikes, retailers, and their own overworked staffs all over the country in a frenzied rush to accomplish nothing concrete, sales-wise? The answer is simple: retailer attention. By putting on their own show, the big guns can get hours and even days of buyers’ undivided attention, present their products in the very best light, and do a little beer-drinking together while they’re at it.

The late July/early August part is mostly because it’s the earliest they can possibly do so.

The Bottom Line.  Barring another Bio-style power grab (which you won’t even find references to on the Interwebs anymore), Interbike is doing just fine where (and when) it is.

event_horizon

Why Las Vegas? The Black Hole Theory.

Nielsen (the company that wons Interbike and a whole bunch of other shows besides) loves Las Vegas because it’s close enough for dealers from SoCal to drive in, and enticing (and cheap) enough to get less-local retailers to fly in. Plus from the show management’s point of view, it’s easy to work with: centralized services, a very effective infrastructure, and—given the fact that Nielsen hosts a half-dozen other shows there each year—god only knows what kind of illicit perks, kickbacks, comps, showgirls, drugs, leather-clad teenage boys, free show tix, in-room massuesses, and deposits into secret bank accounts in the Lesser Dutch Antilles are going on in the back room.

The Short Answer: It’s one of the few places big enough that retailers will actually go to. At least that’s what Interbike thinks. Plus there’s a huge inertial pull—sort of a reality-distorting black hole—surrounding Las Vegas that sucks all other thinking past its Event Horizon.

not_the_germs

The Longer Answer. Interest in moving Interbike to someplace,  anyplace, other than Vegas comes up every couple of years. And Interbike does a survey.

Suppliers, for the record, uniformly hate Vegas—the heat, the dust, the unions, the prices, the sheer budget-numbing cost of moving all their people and stuff halfway across the country for five days. Retailers tend to hate it for most of the same reasons, plus it’s a crappy venue for bikes and a crappy excuse for a vacation besides.

But Interbike and the NBDA claim that a huge number of retailers prefer Las Vegas to the other locations big enough to hold the whole extravaganza under one roof (currently Denver and the new facility in Anaheim). So back to Vegas we go, year after year.

Interestingly, I’ve been trying literally for years to find out who these retailers are who demand Las Vegas as their destination of choice, just to see what kind of creature could like both bikes and that curious tumbleweed-infested patch of desert called Sin City. I’m sure they exist, these retailers, but in thirty years in this business I have yet to meet a single one.

The folks I see drinking and gambling far into the night (and sometimes when I get up early to make a 7:00 meeting, into the next morning, too) tend to be low-level employees on both the wholesale and retail sides of the business who treat a once-a-year trip to Vegas as a sort of combination paid vacation and five-day drunk. Store owners and senior distributor types have too much work going on to mess much with stuff like that. For them, Interbike is the toughest work week of the year, and one that comes after thirty or even forty days of show prep (or, in the case of retailers, summer sales frenzy) without a day off.

No wonder half the industry is sick the week after Interbike. It’s not the germs as much as it is sheer exhaustion.

The Bottom Line. Yeah, it sucks, and everyone knows it. But we’re going there again next year, and the next, and every year for the foreseeable future. And some people seem to like it. Besides, what do you think Interbike is about, anyway—selling bikes?

To learn more about Rick and his background, check out his bio here or go to his site here.

, , , , , , , ,

4 comments

  1. Brian Ignatin

    While LV sucks for all the reasons you’ve mentioned in your articles, it is still the trade show capitol of the US because there is an abundance of hotels, and the frequency of direct flights, both of which come relatively cheaply compared to most other destinations.

    Trade shows for major players in all industries are becoming less relevant as websites (both public and private) contain more content. If you are not trying to attract large quantities of new customers, why go to the expense of having a major presence at a show, when your dealers can see what is new on your website? And as you stated, the dealer meetings at Company HQ provide access to a core and focused audience, at a similar level of expense of attending a show.

    1. Padraig

      Thanks for checking in Brian; it’s nice to count you among our readers. I agree with you about LV’s relative supremacy as a site for trade shows. Rick and I differ somewhat in our analysis of what’s wrong and what’s needed to make Interbike as healthy as possible. Your point about the power of the web is, I think, frequently underestimated.

  2. Larry T.

    I think Interbike will continue without the big boyz just fine. Think of the auto or motorcycle biz. Those mfrs (that’s manufacturer’s — not what you’re thinking!) do their own private convention/show for their dealers, or at least they did back when I sold the things. In the auto biz there was a show for the small makers of stuff, called Specialty Equipment Manufacturers Association (or something like that) that was sort of like Interbike. As long as there are any INDEPENDENT bicycle dealers left out there, Interbike will cater to them. The big brands pretty much want to squeeze the I out of IBD in favor of concept stores anyway, so once their BIO takeover of the show failed, I’m not surprised they have gradually stopped attending Interbike in favor of the captive audience they get with their on gig. As someone posted on here earlier, all those bikes are easy enough to see at your local bike shop anyway, so good riddance. Interbike will be increasingly for the small boutique bike makers along with component and accessory companies — and that’s fine with me since those guys are part of what makes this an interesting biz. I would vote to have Interbike in Denver (hell, almost anywhere else)rather than Las Vegas.

Leave a Reply

Your email address will not be published.

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>