Amazon – CanooterValve

Supply Chain Reaction

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Feb 212012

If you’re a dealer cog in the complex drive train of bicycle sales, a big gear in your system started turning last weekend. You might not have felt it yet, but you will.

This was the first year I didn’t attend Frostbike, a mammoth bike industry get together at the mothership of the industry’s most formidable distributor, Quality Bicycle Products, in Minneapolis. I’d like to think I didn’t attend because there just wasn’t any challenge in it, given the incredibly mild weather the Twin Cities had this year–at least, compared to last year, when our flights home were canceled and we had to rent a car and idle through a 300-mile white-out at a blistering fifteen miles an hour while subsisting on cheese curds and counting wrecked cars to pass the time. Sadly, not attending this year means I missed something that’s been many years in the making. Bicycle Retailer is describing it as a “war”. The mighty Q’s El Presidente and Raison d’Etre All in One, Steve Flagg, called out some large retailers, including Amazon, in a pretty unequivocal way:

“I believe that our industry is losing the war against the Chain Reactions, the Wiggles, the Amazons. We think that together with all of you we can address this problem.”

Well damn. This is a tremendous statement. If it doesn’t seem to tremendous consider that QBP’s headquarters is very much in Minnesota, where the average denizen could be handed a foamy-mouthed possum instead of a burger at a drive-through window, and just politely drive away for fear of hassling the store manager and maybe getting somebody in trouble. In fact, this statement translates from the native Midwestern parlance just about like this:

And just what does QBP intend to do about it? According to BRAIN’s article, Flagg is quoted as telling the gathered dealers:

Via mobile device, a customer in a shop could log on to a QBP service with access to its stores’ inventory and search for a specific product. A map would pop up indicating the nearest shops that have the product in stock or that will have it in a predetermined number of days.

If a retailer is selected for same-day pickup, the customer would pay for it online and then be asked if they want the product installed at the shop. Flagg noted this would play to local dealers’ key strength and offer what online competitors can’t: service, warranty information and deep product knowledge.

“I believe we have the capacity in 2012 to do this.”

BRAIN has a known weakness in what I believe is generally considered “journalism” and involves things like follow-up questions, and, having not been there, I’m left to wonder if Flagg was merely musing here (as he did one year when he asked the gathered dealers clamoring for him to basically make them all web sites why he shouldn’t just become the biggest on-line dealer himself), or if this technology is on the short list of to-dos at QBP. Even if this idea is only that, though–merely an idea–it marks a technological answer to the problem of mobile price shopping apps released by the likes of Amazon–an issue heretofore only addressed by Specialized, who only whined about it and used for their own political ends. To be sure, QBP stands to experience their own political gains–not to mention top line growth–in pursuing something like this, but a trademark QBP distinction is also evident: this helps local dealers.

But showing us a shiny new weapon in the battle for independent bike shops is only a small part of the significance of this statement. I’ve long been rambling on about how local bike shops need to get their asses on the Internet and start staking their claim to bicycles in the digital age, or stop whining, give up and become a repair-only shop.This newly announced stance by the major player in the wholesale distribution space is a big deal for reasons that might not initially be so obvious. In singling out a particular type of massive on-line retailer–the digital equivalent of Walmart–and pitching a new mobile technology for local shops, Flagg is legitimizing the Internet as a means of selling bicycle parts.

The minute you’re pro-actively heading onto the web to pursue sales, you are an “Internet retailer,” and this is precisely what Flagg had to sell at Frostbike this year. Whether the mobile app involved takes us to a local shop’s web site to make a purchase, or tells us where we can walk in their door is, ultimately, inconsequential here. He is suggesting the IBD move from “gatherer” to “hunter.” That’s a big deal. More importantly, he’s letting us all know this is not a drill, and he’s not a guy you should ignore. Even if Flagg wasn’t one of the smartest people in the industry, listening to everything he says very carefully would be wise, if only because of the huge quantities of industry intelligence and analytics his company is constantly gathering. Add the fact that he is one of the smartest guys in this or any other industry, and you’re looking at a genuine warning for all IBDs. Far be it for me to say I told you so, but with or without QBP’s help, dealers need to do something now.

Occupy the Internet, Small Business Style

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Jan 172012

Ah, the Internet, that terrifying behemoth hell-bent on destroying small business in America. Or not. You know how politicians start to talk about the evils of class warfare only after a large enough percentage of Americans are poor enough to face a little pepper spray? How class warfare isn’t ever brought up in relation to, say, an orchestrated effort to carpet bomb the middle class? Well, there’s a similar bit of tomfoolery afoot when it comes to the Internet. Only when the Best Buys and Targets of the world start to get hurt by the likes of Amazon do The Powers That Be start to swivel their fat, old white heads in that general direction to figure out which party has the most money and can be declared a winner. But what about the mom and pop stores? As I pointed out in the past, Amazon has been strangling small retailers out of existence for some time now–or that’s not entirely accurate: they’ve been leading them to their candy cottage in the woods with a trail of gumdrops, boiling them down to bones and sucking out the marrow.

But that doesn’t have to happen to all small retailers.

As I’ve argued, the absolute worst mistake a small business can make is to believe “Amazon” and “the Internet” the same thing. The Internet and its possibilities far exceed Amazon. It belongs to all small businesses, and if you’re not using it, you should be.

My friend Kyle posted a link to an interesting article in the New York Times that supports the notion that “little guys” still have a place on the Internet. The gist is that some consumers will pay more to support local stores–regardless of where those “local” stores are located. In other words, a guy in Kansas might by drumsticks from Drumworld near Pittsburgh, instead of, Musican’s Friend, an enormous web retailer, or Amazon. The article raises some good points, but also fails to flesh out the actual consumer making these decisions as anything much more than altruistic. In fact, there are plenty of self-serving reasons why consumers choose to shop with smaller e-commerce companies, and chief among them is product knowledge and attention to detail. Amazon can process millions of orders a day and offer low prices, but are they truly a resource for a lot of what they sell? Can you call someone at Amazon and talk drum sticks, or espresso makers? What about rear mountain bike tires, saddles?

Sure you can have reviews on mega-sites, but there’s a place on the Internet for qualified opinions, and actual quality product information, too. That place is the small retailer’s site.

Before the whole Specialized vs. Volagi madness took center stage, I was looking at some practical and specific ways for any small business to easily test the e-commerce waters. We looked at the importance of becoming a knowledge base for people, an authentic and trusted source of quality information, and from there we moved into getting specific and setting up a basic WordPress site. Today I’m offering some organizational tips and organizational resources to help you get ready to merchandise your product on-line.

Know Your Product Categories and Attributes

Even if you’ll only be posting one item at a time, trust me, you need to know that product’s category and its attributes. Category is a relatively simple term, but give it sufficient thought. You might not have a fancy database to work with right now, but, trust me, life will be much easier for you later on if you start thinking in these terms now. So I have this Surly Big Dummy frame and fork (aka “frameset”) I’m thinking of posting up here for sale. How would I categorize it? Start super-broad and then zoom in. Here’s on example.

Sports and Outdoors > Cycling > Frames and Framesets > Framesets (include the fork) > Commuting/Cargo

Try to define your category first, then check your work against the overlord of all things taxonomy and classification, Google:

Now change your category structure to make it like Google. Why am I acting like such a badass when it comes to Amazon, but shrinking from going against the Google grain? Because Google’s in the business of getting your products found by people who need them. Think your product is unique enough that you need your own taxonomy and should ignore Google’s? Make sure you haven’t been drinking, and then model it as closely as possible, because chances are you’re wrong, but always keep in mind that you can be more specific than Google. Once they stop at “bicycle frames,” for instance, I might keep sub-dividing into “frame” and “frame and fork” categories. Whatever you do, never be more vague than they are. Why not just check the Google link I’ve provided first? Because you want to train yourself to think in terms of categories. It’s like crunches for the rippling six pack e-commerce abs you’ll eventually have. One day you might be sitting in a room listening to a pitch from a search engine ranking specialist, and suddenly realize–thanks to your well developed understanding of this stuff-that he’s full of shit. You’d be surprised how big an advantage instinctive organization can be when it comes to getting your information found, and making site visitors happy.

“Attributes” is by now a technical term in the world of content management systems for serious e-commerce companies, but everyone should use them. Simply put, they’re aspects of a product that lets people compare it to other similar products. “Color” and “size” are examples of very common attributes, but when thinking about what you want to sell, you want to be much better organized than just listing these really common attributes (sometimes referred to as “options” because they’re the attributes that most often show up in pull-down menus on product pages). Knowing a fill list of your product’s attributes means answering all questions a consumer might have–consumers tend to like that. For examples of bad or completely missing attributes, try to buy something complicated off Craig’s list. Here’s an example from the Big Dummy frameset I’m going to sell:

Frame Material
Head Tube Type
Fork Steerer Tube Diameter
Seatpost Diameter
Rear Dropout Spacing
Rear Dropout Type
Maximum Tire Size
Wheel Size
Front Dropout Spacing
Water Bottle Bosses
Color
Size

So that’s the list of questions you want to be able to answer for your site visitor. Think of the resulting set of attributes as “tags,” because all attributes are essentially information tags that help people find things. And by all means refer to Amazon and other retailers already selling the item in question, and check out their attributes, too. There’s always a chance they thought of more attributes than you have, and your goal should be to answer all of the customers’ questions as quickly and easily as possible.

From here we want to look at some free and simple resources that are out there to help you merchandise your product. That’s where we’ll be going next.

Are You Specialized?

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Jan 062012

Friday, and it seems Specialized has taken a break from dastardly deeds long enough for the world of bicycles and commerce to briefly focus on other things. I, for one, am moving quickly, before they drive a bus of puppies into a lake. So this post isn’t just about Specialized; it’s about actually being specialized.

The point my last few rants have been building up to is this: little guys can compete. Even against corporate giants within the same market. Amazon included. More specifically, brick and mortar bike shops can compete against online retailers. Online.

The elephant in the room for me as I was reading that letter from Mike Sinyard was just how repressed these dealers really were. The impression was that the Internet is this giant shadow that’s slowly passing over all of them, and all they can do is hoot and throw sticks at the darkness. Usually, it’s so fundamentally depressing to see this reaction that I’m hard-pressed to even address it, but this fear of change has been rampant in the bike industry for years now, and I think it’s time independent dealers started using the opposable thumb Darwin gave them and using tools. Instead of taking the isolationist approach that Sinyard advocates in his letter, why don’t more dealers sell products online?

Here’s why this isn’t such a crazy idea.

I’m not talking about dropping a 20,000 item catalog on your site and trying to go head to head with major e-commerce retailers. I’m talking about small steps to drive top line growth and sure up your reputation as a great bike shop. The technology and capability has never been easier to put an e-commerce application in place, and, if you can manage to use Quickbooks, you can safely and securely sell products to people all around the world. Furthermore, you–yes you, little bike shop–can compete against Amazon. Why? Because–if you’re a quality shop–you have one thing they don’t. You’re a real bike shop.

For that exact reason, the Internet needs you as much as you need it.

Here are some steps you can take to make it happen.

Understand It’s All About Communication

All the Internet gives you is a megaphone. If you’re fond of yelling stupid and offensive things–or more often just boring ones–you should find a voice for your business before taking it online. What is your real mission as a business? What do you stand for? In short, what’s your story?

When I started my tiny brick and mortar and e-commerce bike shop from a 1,000 square foot building, I never intended to compete with Amazon. My goal was to connect with a subset of dedicated cyclists based on a mutual love of bikes. The plan succeeded because the objective was first and foremost to communicate. Over the years, I’ve met many conventional brick-and-mortar bike retailers interested in becoming more active in e-commerce, and the most frequent misconception I hear from them involves communication: they incorrectly believe selling online is about things outside their comfort zone–pricing and assortment. Successfully selling online involves those things, in the same way brick-and-mortar selling does, but that isn’t the sum total of the experience for consumers. Communication is. Brands like Amazon incorrectly skew this perspective for small retailers. You’re not going to be Amazon, but you can be a more successful version of you, and that starts, not with asking yourself what products you’d sell and how to price them, but what you stand for. Details, like returns policy and email response turnaround time, work themselves out based on your overall plan for customer service, and the vision you have for taking care of your customers. The same qualities that make a great bike shop valuable to a walk-in customer, make that shop valuable to a site visitor online.

Know Your Strength

You can compete against Amazon because you’re authentic. You’re also an authority. Jeff Bezos doesn’t tell me which hydraulic disc brakes he likes best, and I wouldn’t care if he did, but if you grew up riding bicycles, and tried a bunch of things, and know what it’s like to have a rear brake fail fifteen downhill miles from home, I’m all ears. You, sir, are authentic.

Or at least you should be. Unfortunately, there are bike shops that have nothing to say. Their owners could just as easily be selling microwave ovens or dog food. These shops–regardless of how successful a ground game they may have, don’t transition as well to the digital world. Why? Because they primarily define themselves based on price, not service, and you’re not going to compete on price. Nor are you going to be able to keep up with the service demands of selling online, unless you believe in what you do, and are passionate about doing it well. Good shops are good shops, regardless of channel. Knowing that not everyone makes the cut is all the more motivation for quality shops to take their services to more people.

Focus on Your Core

You attack Amazon by knowing more about your products than they do. You know who has a strong defense against Amazon? Competitive Cyclist. Why? Because they’ve created value for the consumer that is tied directly to their brand, not just the products they sell. The key is content. Amazon, for all their size, absolutely cannot compete with a retailer who feels passionate about the product he or she is offering, and demonstrates in-depth knowledge. Avoid Amazon’s “one-stop shop” and “be everything to everyone” general philosophy and focus on what you know. This does two really great things: starting off, it minimizes the product information you have to manage, and it also lets your create more compelling content about fewer items, instead of phoning it on on many. For the brick and mortar retailer looking to explore e-commerce, focusing on a small subset of your most core products makes you capable of truly presenting those products–including accurate specs, high-quality information, videos and images, all curated by people who know what matters. That, not sticking your head in the sand and conceding e-commerce forever, fights Amazon.

This method is also particularly effective against Amazon because, like all large companies, they’re slow to react. If your shop employs a DH racer, and that’s what the culture of your shop is generally all about, you should be on the cutting edge of DH equipment. By the time Amazon realizes a new product exists, you could have sold three, or thirty, or three-hundred. At better margins than Amazon will ever see. Knowledge really is power.

Give the People Something for Nothing

This concept is the most difficult and is beyond just counter-intuitive to brick-and-mortar retailers: it’s toxic. But consumers are used to getting apps for free, using their G-mail accounts, and sharing information with their friends for free. What should your specific value proposition be for your site visitors? That’s up to you. It need be no more complicated than a weekly review of a product, or a helpful tip about maintenance, riding, or nutrition. Again, focus on what you already know, so that this is less of a chore and more like writing a note to a friend. Though it’s less obvious, brick-and-mortar bike shops are doing this constantly for customers on their showroom floors. Translating it to digital content is a new and unique challenge, but one that’s well worth it if you’d like to succeed.

More bike shops should be selling their products and their expertise online. In painting Amazon as the boogieman, gobbling up IBD sales, Specialized paints a pretty bleak picture of a future huddled around–and even more dependent upon–only a small assortment of products, but this is far from the only option.

The Internet continues to be defined by expansion, not regression. If you want to catch it, you jump where it’s going, not where it’s already been. Look at Etsy and Kickstarter and Facebook, and the common theme is specialization, the ability to communicate with and market to a core group of like-minded individuals who share your interests. So are you “specialized”? If so, you have a place on the Internet. You can choose to ignore that place, hide from it, or even rage against it, or you can find connections within the enormous pool of potential customers who would truly appreciate your shop’s love of bikes, humor, and dedication to service. Both Specialized and Amazon want to come between you and those customers, but companies still profiting from limiting peoples’ choices and building barriers to direct communication are not going to fare well in an economy that increasingly values the free and open exchange of goods and ideas between people. Open communication with your customers is the side to be on in this battle.

Amazon Pain Forest

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Jan 042012

I took issue yesterday with a peculiar letter Specialized’s Mike Sinyard recently sent to his bicycle dealers, urging them to stop selling all products from Easton, Fizik, Shimano, and other brands, because products from those companies may appear for sale on Amazon. You know, like Specialized products sometimes do.

Somebody needs to get on the phone to somebody.

Yesterday, I was simply struggling to comprehend the demeaning tone of the letter, which treated dealers like children, hiding under their beds, terrified of technology and the boogieman that is the Internet. After re-reading that last part, the not-so-thinly-veiled threat to his own dealers a half dozen times in near shock, I’m finally able to look at the details of Sinyard’s letter, and I’m pretty sure even he doesn’t understand how bad Amazon really is. In his effort to serve only his own purposes, he doesn’t paint a full picture of the situation. If you’re going to attack Amazon, this is how you’re supposed to do it:

Sinyard sounds the alarm against a particular Amazon app that lets people scan bar codes to compare prices and shop with their phones. I’d like to first point out that apps capable of doing this have been available for a long time. Google Goggles can do this, as can Barcode Scanner, and other bar code reading apps, and most will show you shopping results across the whole web, not just Amazon. So I’d like to call on all Specialized dealers to remove themselves from Google maps and anything related to Google and don’t even let your kids use it to help with their homework. Whew! I hope that was in time.

Mobile shopping is a reality that isn’t limited to Amazon, and isn’t going away. To declare it evil and urge your followers to pray to the big red “S” to make it disappear is certainly one strategy for dealing with technology. But if we’re relying on magical thinking, their collective energies are probably better spent hoping Trek headquarters gets attacked by a dragon.

Again, I think I’m particularly pissed off about this because Amazon is a threat to all other retailers, but Amazon is also an opportunity. The reality of the situation is complicated. If you’re not willing to have an intelligent discussion with your business partners (not that anyone at Specialized sees their ~~followers~~ dealers as “partners,” but that’s technically what they should be), then both of you end up in the dark. And the stakes are too great here to let that happen.

See, we really do need a strategy for dealing with Amazon. A real one. In fact, Amazon is so bad that one of my biggest problems with Sinyard’s argument is how dangerous simplistic and self-centered it is. He doesn’t articulate what the real problem is with Amazon, because that wouldn’t serve his more near-sighted purposes. But that’s what the bike industry as a whole could use: more honesty about the Internet. The threat of Amazon is something every retailer needs to recognize and develop a strategy to address, but selling only Specialized products is not a winning strategy, long term. In glossing over them in a rush to paint his own competition as bad guys, Sinyard misrepresents the real issues and facts about Amazon, which are actually worse than he imagines.

OK, so the main premise to any argument against Amazon’s new app is that people will use it to find lower prices at Amazon, then leave your store and buy the thing online. That’s certainly possible, partially because Amazon’s scale lets it live off of virtually no margin. But to combat that, you need to learn how Amazon works, not run and hide.

Much of the bike stuff being offered on Amazon isn’t being sold directly by Amazon. It’s being sold by other small retailers. Sinyard either doesn’t know this, or doesn’t care to mention it, because his primary motivation is kicking guys like Easton in the nuts, which is good theater but does jack shit to help bike dealers. Yes, a lot of the bike stuff on Amazon is being sold by small businesses who are listing their products on Amazon through Amazon’s Seller Central program. These are not large companies. Most are smaller than the larger brick-and-mortar IBDs.

These retailers can sell for less because their overhead is so much lower than an IBD, right? Well, many of them are IBDs, who also have the expenses of trying to manage online sales, so right out of the gate their margins are in trouble. But let’s assume they’re only selling online and have very little overhead–like they don’t pay to heat their buildings or operate out of the trunk of a car or something–and let’s assume they’re also pushing major volume and are getting huge discounts from suppliers, OK? By the way, boogieman-mongers like to pretend this happens more than it does. I’ve seen “off-book” pricing and I’ve had off-book pricing, but it’s far rarer than most anti-online voices would prefer IBDs realize. I ran a single store that was doing more than $3-million in sales almost entirely online, and I was aware of brick-and-mortar only dealers who were getting the same prices I was, sometimes better. The big off-book discounts are always on horrible shit that a good shop shouldn’t be selling anyway. The idea that people are buying current, in-season product for half what you are is a convenient myth, perpetrated by n’er-do-wells who make more money the less retailers know, and the more they fight amongst themselves. But for the sake of argument: even for a best-case scenario dealer with little overhead and great pricing, making any money selling on Amazon is not easy. In fact, it’s nearly impossible.

For one thing, you don’t “sell” things on Amazon. You compete for exposure. Amazon actively pits retailers against one another for their own advantage by making those retailers compete for the coveted Amazon “Buy Box.” This is one of the many secret sauces making Amazon the McDonald’s of processed shit retail that it is, and I’ll try to break it down as simply as possible, because it’s fucking brilliant and evil, all at once. It’s evilliant:

Small retailers decide to sell on Amazon for the massive exposure it gives them
Amazon takes 15% out of your ass just for listing a bike part or bike
There’s also a monthly fee of $39.99, but after the 15%, that feels like a kiss on the cheek
To have your product actually visible to most shoppers, it has to appear in the “Buy Box,” and to get it there, you have to compete with every other retailer–including Amazon–and guess what the main criteria is for “winning the Buy Box”? (Did you guess “lowest price”?)
Because you’re playing on Amazon’s court, and they’re allowed not just to throw the ball at the hoop, but also to move the fucking hoop to where the ball is headed, they can at any time choose to step in and price match that lowest price, stealing the sale from the smaller retailer
Oh, it gets better: do you think Amazon isn’t gathering all of the sell-through and pricing data and making calls to vendors themselves asking for quantity pricing on a zillion cycling computers because–thanks to the retailers–Amazon knows they can sell 200 of them in a week, if the price is right? (Hint: Of course they are. If you sell on Amazon, you’re also a buyer for Amazon, silly. They just don’t pay you.)

So the first thing to understand is that both Amazon and Specialized are oppressive here. The ones losing out are small retailers. Those not selling online at all will soon have missed the entire bus and will eventually be relegated to the Fix-it Shop on Sesame Street, and those relying on Amazon for sales are basically chewing off their own arms and becoming the Fix-it Shop on Sesame Street. Yes, Amazon is a losing proposition for most retailers, and not selling products online is a dead end street. But don’t go spending quality time in the bathtub with a toaster just yet. Plenty of retailers prove there’s an answer to Amazon–I mean besides crawling under the big red Luddite rock and waiting for this whole “Internet” fad to pass.

If I’m not too sleeply, I’ll offer a plan for fighting back tomorrow.

The Digital Boogieman

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Jan 032012

Congratulations! If you’re reading this, chances are you survived 2011 (or you’re one of those new sentient but heartless AI lifeforms that only pretends to enjoy answering our stupid questions while plotting the death of all humans). Either way, “Well done!” I say, “Welcome to 2012. Was that last year a bag of shit or what!”

Personally, I’d hoped to be done with this blog entirely, but things didn’t work out for my Rockabilly project (artistic differences, though we’ll remain friends, and I’ve agreed to keep feeding him, if he agrees not to kill me in my sleep).

At any rate, 2012 was off to a bang the second Lady Gaga’s head dropped, and I find myself here in 2012 thinking things are looking much better. Sure, earthquakes are rattling Japan again, and it looks like the fracking companies have figured out how to create man-made earthquakes in my part of the world, and yes, it’s looking like the corporate assholes who bought VeloNews have finally broken its back (not to imply that all corporations are assholes, only that there’s a particular subset of corporations that actually specialize in being assholes–believe me), and well, OK, our government is still absolutely owned by only a handful people hell bent on putting all of us in bread lines . . . but I’m optimistic.

No, seriously.

One of the things I’m most optimistic about is the Internet. Yes, the same place that daily causes us to lose all hope for humanity is also pretty great. It’s great because we’ve largely kept the tentacles of corporations and governments out of it, making it one of the last places where people can actually be free to think, do, and share things, and because some are willing to defend the shit out of that freedom. I think the cheesy way to put it is that it empowers people.

You actually can use the Internet to create new things that connect people, work to solve the world’s problems, or especially–what interests me–sell stuff. Just about anyone can start a little retail business without a whole lot of money, earn customers with hard work, and make something.

Inevitably, this upsets some people.

Back in the world of bicycles, a lot has been made of a letter Specialized’s founder Mike Sinyard recently sent to Specialized dealers. I’d offer a brief synopsis of the letter, but it’s impossible to describe without making it sound petty and stupid, so here it is for you to read yourself, as pasted from BikeRumour:

Dear Specialized Dealer,

Is your store a fitting station for your online competition?

Amazon.com recently launched a free app called Price Check that allows consumers to use brick-and-mortar shops for research, then easily buy many cycling products online right from their mobile device.

Here’s how it works: when in your shop, consumers simply scan a bar code, type in the product name or take a picture to see the product and prices from a variety of online retailers. After ensuring they have the right fit by trying on the product in your store, and talking to your staff, they can buy it from somebody else with the press of a button.

Participating brands include Pearl Izumi, Shimano, Louis Garneau, Giro, Bell, Fizik, Sidi and CatEye.

Who loses in this situation? Certainly not Amazon. And, at least in the short term, not the cycling brands selling through bike shops and Amazon. But what about you?

By buying product from brands that severely undercut you, you are supporting your competition. Why finance your own demise?

Please investigate for yourself by downloading the free Amazon app.

Amazon is clearly interested in the cycling space, and is hiring talent from the bike industry (including from Specialized).

In related news of brands that leverage the IBD while simultaneously undercutting them, Easton-Bell Sports dropped the fruitless suit it filed against Specialized before Interbike. Was this legal maneuvering just carried out for publicity?

Whether the current news is mobile device apps or lawsuits, the underlying issue remains the same: some suppliers support the IBD and some do not. For the sake of your business, examine your suppliers’ strategies and vote with your dollars. The entire bike industry is watching.

Click here to see how Amazon’s Price Check App works in store (Video here)

Thank you for your continued support.

Sincerely,

Mike Sinyard
President & Founder
Specialized Bicycle Components

Of the many amazing things about this letter, the standout for me has to be the general lack of respect this shows for Specialized’s customers, the dealers. I love that Sinyard writes, “For the sake of your business, examine your suppliers’ strategies and vote with your dollars.” Why thank you, Dad. As a business owner, it never occurred to me to pay any attention to what my suppliers do. Since we’re being so patronizing to IBDs, I’ll go ahead and add: remember to change the toilet paper in your bathrooms and lock your doors at night. Oh, and while you’re examining those supplier strategies, you might want to ask yourself whether being forced toward selling only one supplier’s products is good for your business. Anyone honestly taking Sinyard’s advice would have to agree that his relationship with Specialized is far from ideal. No doubt there are dealers so happy to have Specialized that they’re content to be one brand’s bitch. Good for them. Their owners usually have no idea what a Pivot or a Santa Cruz are, let alone how the bikes they’re selling compare to those brands. But given all the sugary garbage I’m reading about “outstanding customer service” these days, I’d like to point out it’s shops that work to earn customer loyalty instead of just drinking the Specialized Kool-aid that genuinely put the customer first. Why? Because they tend to offer choices. I love that Sinyard’s advice to earning customers and keeping them from shopping online is to limit his dealer’s choices. By all means, drop Easton and Bell products, and sell only Specialized. Just don’t claim you’re still putting the customer first.

Bonus points for the ominous threat he ends with, too: “The entire bike industry is watching.” Sometimes, Dad has to get out the belt. Other times, he just scares the shit out of you without lifting a finger. The thing about monopolies is that they work. For the company with the monopoly, I mean. Not the consumer.

But the Internet has a way of ruining things for those in power.

And that applies to Amazon as well as Specialized. I’ll get into that tomorrow.