e-bike telematics - survey results

E-BIKE TELEMATICSAn online survey to gather the industry opinion about the e-bike telematics technology and to analyze its German market potential

Survey as part of the master thesis “E-bike Telematics” by Nils Niederheide, MBA in International Marketing !

Published in Feb 2014

DECEMBER 2013 MASTER THESIS “E-BIKE TELEMATICS” BY NILS NIEDERHEIDE

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SURVEY METHODOLOGY

MethodOnline questionnaire with web link distribution via direct e-mail, social media (LinkedIn, XING, Facebook) and via an e-mail newsletter of the bicycle trade magazine “Bike Europe”

PurposeTo analyze the current situation on the e-bike market and to evaluate the German market potential of the e-bike telematics technology by gathering an industry opinion.

AudienceIn total 87 industry experts like bicycle manufacturers and other e-bike professionals took part and filled out the questionnaire.

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Period Surveyed

From start of October till mid of November 2013.

E-BIKE MARKET TELEMATICS


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‣ 40% of the audience are employees of bicycle manufacturers.

‣ 60% individuals are professionals in related e-bike businesses like marketing, media or other services.

‣ Participants in higher positions have been selected with priority:

‣ 32% senior management position

‣ 48% middle management position

‣ 20% couldn’t be allocated / n.n.

‣ Median years of e-bike experience is 6,0 years per participant.

AUDIENCE SURVEYED ��3


87 ParticipantsTOTAL1. Audience structure

German International Total

Bicycle manufacturers 29 33,33 % 6 6,90 % 40,23 %

E-bike professionals 26 29,89 % 26 29,89 % 59,77 %

55 63,22 % 32 36,78 % 87

2. E-bike experience

less than 3 yearsmore than 3 years

< 20 yearsMIN 20%German audienceMAX 1 63%

>3 years exp.MAX 2 85%


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KEY FINDINGS - E-BIKE MARKET ��4

Main target group of e-bike industry is the 30 to 60 year old clientele. A comparison with age groups interested in e-bikes shows potential clientele for <20 and >60 years old as well as an excess orientation on 30-60 years old.

1. “Potential clientele for <20 and >60 years old” Go to Slide

The e-bike market consists of lot of segments that are almost equally strong. The city bike still has majority, but other types of e-bikes like trekking, mountain, folding and even road bikes are catching up.

2. “Equally segmented e-bike market” Go to Slide

With the battery capacity and drive system brand as most important USPs for e-bike, the e-bike price and brand only play a secondary role. Further e-bike elements like software setup and extra services are of lower importance.

3. “Drive system is most important USP for e-bikes” Go to Slide

Problem number 1 is clearly the unreliable technology with 55% votes. Apart from this product orientated factor, there are highly rated macro environment problems and a lot of micro environment problems.

4. “Unreliable technique problem #1 of e-bike industry” Go to Slide

More than 75% of e-bike professionals rated the e-bike introduction with a medium to high impact on their business activities. Especially the support and the down-stream activities have been affected.

5. “E-bike introduction had high impact on e-bike industry” Go to Slide



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KEY FINDINGS - TELEMATICS ��5

E-bike professionals have in general 2-3 risks or disadvantages regarding e-bike telematics. Biggest concerns are missing regulations/standards as well as expensive adaptation to new technology.

8. “Missing regulations/standards is biggest industry concern” Go to Slide

While industry estimates comfort-oriented functions like security system and navigation as top 2 for consumers, manufacturers value more service-orientated functions like maintenance guide a real-performance data.

7. “Demand for comfort and service-orientated functions” Go to Slide

No one thinks that e-bike telematics is not suitable for e-bikes. Highest estimated market potential is with 38% the premium segment followed by mass market (29%) and optional add-on (22%).

6. “Market potential especially for the premium segment” Go to Slide

The majority prefers telematics software integrated into drive system display or smartphones and tends to rather outsource telematics related data management and services.

9. “Minimizing hardware and business integration” Go to Slide

Almost all think that e-bike telematics will have an influence on the e-bike business which is expected to be similar to the e-bike introduction. Same business areas could be affected but on a less intensive level.

10./11. “Similar impact like e-bike introduction expected” Go to Slide

Over half of the manufacturers surveyed already have plans to introduce e-bike telematics into their new e-bike models. 1/5 prefers to wait and 25% still do not have any plans.

12. “Majority plans telematic launch for next MY” Go to Slide



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E-BIKE MARKET


Topics Slide

E-bike target groups 7Unique selling prepositions 8

Types of e-bikes 9Problems of e-bike business 10Impact of e-bike introduction 12


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66 ParticipantsTOTAL

‣ Main industry target group for e-bikes are 40-50 years old.

‣ 34% votes are younger and 39% older than the average of 45 years (slightly negative skewed chart).

‣ More balanced chart for age groups interested in e-bikes.

‣ Comparing industry target group and age groups interested in e-bikes shows:

‣ Potential clientele for <20 and >60 years old

‣ Excess focus on 30-60 years old

1. E-BIKE TARGET GROUP ��7

40-50 yearsMAX 85%

* Fahrrad-Monitor Deutschland 2011; Bundesministerium für Verkehr, Bau und Stadtentwicklung; Referat UI 31 - „Personenverkehr, Öffentliche Verkehrssysteme,

Radverkehr“; November 2011

0 %

21,25 %

42,5 %

63,75 %

85 %

Age groups in years<20 20-30 30-40 40-50 50-60 >60

57 %

51 %49 %

40 %38 %42 %

51 %

72 %

85 %

55 %

32 %

20 %

12/2013 Target groups11/2011 Interested age groups*

< 20 yearsMIN 20%



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Others 8%MIN

‣ Main type of e-bike is the City Bike after Trekking and Mountain Bikes.

‣ E-bike segments more balanced than normal bicycle market.

‣ Specialized types of e-bikes like MTBs, Folding and Road Bikes have bigger market shares than in the regular bicycle market.

‣ Other answers:

‣ Recumbent, cargo, cross, urban, solar and full suspension bikes

‣ Drive systems for e-bikes

2. TYPES OF E-BIKES ��8

City BikesMAX 25%

* ZIV Jahresbericht 2013 - Mitglieder und Kennzahlen Zweirad-Industrie-Verband e.V.; April 2013


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‣Most essential USPs of e-bikes are battery capacity and drive system brand with average ratings above 3,2.

‣E-bike brand on rank 4 with lower importance than drive system brand (rank 2 with more high importance ratings).

‣Software and extra services with lowest importance ratings.

��93. UNIQUE SELLING PREPOSITIONS

Software setup AV 2,68 MIN

Battery capacityMAX AV 3,25

Battery capacity

Drive system brand

E-bike price

E-bike brand

Extra services

Software setup

0 % 25 % 50 % 75 % 100 %

21,5 %

26,2 %

30,8 %

29,2 %

47,7 %

52,3 %

36,9 %

26,2 %

38,5 %

50,8 %

33,8 %

26,2 %

29,2 %

43,1 %

23,1 %

13,8 %

12,3 %

15,4 %

12,3 %

4,6 %

7,7 %

6,2 %

6,2 %

6,2 %

Not important (1) Low importance (2) Mid importance (3) High importance (4)

Average

3,25

3,23

3,03

2,92

2,74

2,68

2,97AV 3,0Median


66 Participants / 390 AnswersTOTAL


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E-mobility comp. 8%MIN

‣ Unreliable technique is the most rated problem

‣While rank no. 1 clearly addresses the product itself, followed three problems like lack of specialists, legal uncertainties / barriers and quick evolving product-life-cycle are rather external types of problems

‣ Each participant selected in average 3,75 problems of e-bike business

‣ Other comments: Mainly lack of consumer knowledge / understanding

4. PROBLEMS OF E-BIKE BUSINESS 1/2 ��10

TechnologyMAX 55%

Problems / pers.AV 3,75

1 of 2



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Internal 83%MID

‣ Dividing the problems of e-bike business into the three types of business environments, we can state:

‣ 8 of 12 problems are located in the micro environment with cumulated 213% of all votes. All five factors of the micro environment are affected which have direct influence on the internal company environment.

‣ Middle segment is the internal environment with the main, product orientated problems.

‣ Closely behind the internal environment is the macro environment with political and technological problems.

4. PROBLEMS OF E-BIKE BUSINESS 2/2 ��11

MicroMAX 213%

MACRO ENVIRONMENT

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MICRO ENVIRONMENT

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INTERNAL ENVIRONMENT

Consumers

Competitors

Suppliers

Some Publics

Intermediaries

Politics

TechnologyEconomy

Culture

Lack of industry specialists (46%)

Legal uncertainties or barriers (42%)

Quick evolving product-life-cycle (37%)

Drive system brand tops e-bike brand (34%)

Low market acceptance & penetration (32%)

Cooperation with suppliers (23%)

Distribution channel and sales (23%)

High competition on e-bike market (28%)

Product not mass market ready (28%)

High e-mobility competition (9%)

Unreliable technique (55%)

Some Publics

Others: Consumer knowledge (18%)

Macro 79%MIN

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‣More than ¾ of all industry experts realized a medium to high impact on their business activities by the e-bike introduction.

‣ From these ¾ surveyed participants, 54% have been affected by a high impact on their e-bike business activities.

‣Only 23% have been unaffected or just realized a low impact.

5. IMPACT OF E-BIKE INTRODUCTION 1/3 ��12

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Low impact 8%MIN

High impactMAX 54%

3,2AV 4,0Median


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‣All business areas have been affected by the e-bike introduction to minimum 72% (low + mid + high impact), which results in an av. vote per person of 2,91 (medium impact on manufacturers).

‣Highest impact on technical client service with an average value of 3,24 and 64% votes for “high impact”.

‣ In- and outbound logistics with lowest impact on the last ranks 9 and 10.

25 Participants / 250 Answers*TOTAL

��135. IMPACT OF E-BIKE INTRODUCTION 2/3

Outbound logisticsMIN

Client serviceMAX

Average3,243,163,122,962,882,882,842,842,682,48

Technical client service

Product management

Research & development

Sales / After sales

Human resources

Operational business

Marketing / Communication

Company's infrastructure

Inbound logistics

Outbound logistics

0 % 25 % 50 % 75 % 100 %

28 %

32 %

32 %

48 %

36 %

36 %

36 %

48 %

56 %

64 %

20 %

24 %

40 %

20 %

36 %

36 %

32 %

32 %

20 %

16 %

24 %

24 %

8 %

12 %

8 %

8 %

12 %

4 %

8 %

28 %

20 %

20 %

20 %

20 %

20 %

20 %

16 %

16 %

20 %

No impact (1) Low impact (2) Mid impact (3) High impact (4)

AV 2,48

AV 3,24

2 of 32,91AV 3,0Median


* This survey question was exclusively for bicycle manufacturers!

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‣Within the manufacturer’s value chain, especially the support activities were affected by the e-bike introduction.

‣Regarding the primary activities, the e-bike introduction had a higher impact rather on the down-stream than on up-stream.

‣ In general business areas based on e-bike knowledge and client orientation / contact show highest impact ratings.


��145. IMPACT OF E-BIKE INTRODUCTION 3/3

Prim

ary

activ

ities

Supp

ort

activ

ities

Val

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(by

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ter,

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)

AV 3,12 Research & development

AV 3,16 Procurement / Product management

AV 2,84 Firm infrastructure

AV 2,88 Human resource management

AV 2,68

Inbound logistics

AV 2,88

Operations

AV 2,48

Outbound logistics

AV 2,84Marketing

AV 3,24

ServiceSales

AV 2,96

Primary down-streamMID

Support activitiesMAX

AV 2,88

AV 3,00

3 of 3

Primary up-streamMIN AV 2,78

Av. impact of >3,0Av. impact of 2,8 - 3,0Av. impact of <2,8




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Topics Slide

Market potential 16E-bike telematic functions 17

Risks / disadvantages 20Telematics integration 21

Impact on e-bike business 22Impact on business areas 23

E-bike telematic plans 25

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E-BIKE TELEMATICS



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Premium 38%MAX 2

‣ Almost ⅔ think that telematics are suitable for e-bikes.

‣No one answered with “No” and about ⅓ is not sure.

‣ The majority expects potential of the telematics technology in the premium segment of e-bikes.

‣ Still 28% estimate e-bike telematics also suitable in the mass market .

‣ 22% could imagine it as an optimal add-on product.

6. E-BIKE TELEMATICS ��16

Yes, suitableMAX 1 65%

YesNoMaybe



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‣According to the industry, top two telematic functions for consumers would be the security system and navigation which would improve comfort and usability for e-bikes.

‣On rank 3 and 4 are maintenance guide and real-performance-data, which rather have a service and technical information role for an advanced “e-bike-to-rider” communication.


��177. FUNCTIONS - CONSUMERS

Average

3,48

3,20

3,11

3,02

2,75

2,66

2,46

2,41

2,05

1 of 3

Security system

Navigation / GPS

Maintenance guide

Real-performance data

Riding analysis

Information / POIs

Remote control

Com. services

Social media

0 % 25 % 50 % 75 % 100 %

8,2 %

14,8 %

18 %

13,1 %

21,3 %

31,1 %

36,1 %

45,9 %

63,9 %

18 %

31,1 %

27,9 %

49,2 %

45,9 %

47,5 %

45,9 %

37,7 %

26,2 %

44,3 %

34,4 %

36,1 %

27,9 %

19,7 %

13,1 %

11,5 %

6,6 %

3,3 %

29,5 %

19,7 %

18 %

9,8 %

13,1 %

8,2 %

6,6 %

9,8 %

6,6 %

Unimportant (1) Low importance (2) Mid importance (3) High importance (4)

Social mediaMIN

Security systemMAX

AV 2,05

AV 3,48

2,79AV 3,0Median


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‣Primary telematic functions for manufacturers is a maintenance guide to improve the client service for e-bikes. With 61,4% high important votes and an av. value of 3,46, it is clearly on position 1.

‣The position 2 and 3 show that the industry is further more interested in more detailed information output from e-bikes. Real-performance data and GPS tracking could help to analyze the e-bike system and rider behaviors.


��187. FUNCTIONS - MANUFACTURERS

Social mediaMIN

Maintenance guideMAX

AV 2,33

AV 3,46

2 of 3

Maintenance guide

Real-performance data

Navigation / GPS

Security system

Remote control

Riding analysis

Com. services

Information / POIs

Social media

0 % 25 % 50 % 75 % 100 %

15,8 %

14 %

19,3 %

21,1 %

35,1 %

42,1 %

42,1 %

47,4 %

61,4 %

26,3 %

36,8 %

29,8 %

43,9 %

22,8 %

36,8 %

42,1 %

38,6 %

26,3 %

33,3 %

24,6 %

33,3 %

26,3 %

28,1 %

14 %

8,8 %

7 %

8,8 %

24,6 %

24,6 %

17,5 %

8,8 %

14 %

7 %

7 %

7 %

3,5 %

Unimportant (1) Low importance (2) Mid importance (3) High importance (4)

Average

3,46

3,26

3,19

3,14

2,79

2,77

2,51

2,40

2,33

2,87AV 3,0Median


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‣The individual rankings of telematic functions for consumers and manufacturers do not differ very much.

‣Three groups of telematic functions can be identified:

‣Top group are the primarily desired telematic functions that form the basic added value for e-bikes.

‣Middle group are secondary functions with less importance. These functions could play a sub-role and be important for a further differentiation tool.

‣Social media will from industry point of view neither be important for consumer nor bicycle manufacturers.

��197. E-BIKE TELEMATIC FUNCTIONS

Ranking deviationMIN

Ranking deviationMAX

For ConsumersAverage Function

3,48 Security system3,20 Navigation / GPS3,11 Maintenance guide3,02 Real-performance data2,75 Riding analysis2,66 Information / POIs2,46 Remote control2,41 Com. services2,05 Social media

0 ranks

3 ranks

3 of 3

For ManufacturersFunction Average

Maintenance guide 3,46Real-performance data 3,26

Navigation / GPS 3,19Security system 3,14Remote control 2,79Riding analysis 2,77Com. services 2,51

Information / POIs 2,40Social media 2,33

vs.


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‣Biggest concerns from industry side are missing regulations /standards as well as expensive adaptation to new technology.

‣On rank 3 and 4 follow product orientated risk factors like price increase and error rate.

‣As relatively unimportant have been rated personal data security and illegal technical adaptations.


��208. RISKS / DISADVANTAGES

Illegal adaptationsMIN

Regulations / standardsMAX

AV 2,18

AV 2,97

2 of 3

No regulations / standards

Expensive industry adaptation

High-tech increases price

Error rate & maintenance

Too complicated technology

Control of involved parties

Rider’s safety during riding

Higher risk to get stolen

Personal data security

Illegal tech. adaptations

0 % 25 % 50 % 75 % 100 %

6,7 %

6,7 %

10 %

13,3 %

16,7 %

23,3 %

20 %

20 %

16,7 %

36,7 %

20 %

16,7 %

36,7 %

36,7 %

33,3 %

40 %

36,7 %

43,3 %

53,3 %

33,3 %

50 %

56,7 %

26,7 %

40 %

36,7 %

26,7 %

33,3 %

30 %

23,3 %

20 %

23,3 %

20 %

26,7 %

10 %

13,3 %

10 %

10 %

6,7 %

6,7 %

10 %

No risk (1) Low risk (2) Medium risk (3) High risk (4)

Average2,972,822,772,772,722,512,442,432,332,18

2,59AV 2,0Median



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57 ParticipantsTOTAL 2

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‣ The industry likes to minimize e-bike hardware and prefers to integrate telematic functions into the consisting drive system display or using the consumer’s smartphone.

‣The industry opinion about how to integrate e-bike telematics into e-bike business is divided into four options.

‣The majority tends to rather outsource all telematics activities or minimum the data management.

‣The minority tends to have all in-house.

All outsourcing 35%MAX 2

9. E-BIKE TELEMATICS INTEGRATION ��21

Drive system displayMAX 1 44%Drive system displayTelematics displaySmartphoneOther comments

All in-houseOutsourcing servicesOutsourcing data-mgmt.All outsourcing


61 ParticipantsTOTAL 1


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Yes 41%MAX 2

Yes & MaybeMAX 1 65%


45%

‣ Almost half of the surveyed people expects telematics will have an influence on e-bike business and lead to a change.

‣ The other half is not sure and only 11% do not expect any changes.

‣Comparing the general situation to individuals’ business impact, the answer is more balanced into three similarly strong shares.

‣ Although the majority still estimates a change on their own business, the share of “No change” increased to 23%.

10. IMPACT ON E-BIKE BUSINESS ��22


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‣According to the average values, technical client service will be the most affected business area caused by e-bike telematics.

‣Although the highest value of “high impact” votes (50%) has been collected for product management (rank 2).

‣With an average of 2,59 and median of 2,0, the overall impact of e-bike telematics is estimated with low / low to medium.


��2311. IMPACT ON BUSINESS AREAS 1/2

Outbound logisticsMIN

Client serviceMAX

AV 1,85

AV 3,10

1 of 2

Technical client service

Product management

Research & development

Sales / After sales

Human resources

Operational business

Marketing / Communication

Company's infrastructure

Inbound logistics

Outbound logistics

0 % 25 % 50 % 75 % 100 %

5 %

5 %

15 %

35 %

30 %

30 %

50 %

35 %

20 %

20 %

15 %

20 %

25 %

15 %

30 %

45 %

10 %

50 %

45 %

50 %

50 %

55 %

35 %

35 %

35 %

15 %

35 %

5 %

35 %

30 %

30 %

20 %

25 %

15 %

5 %

10 %

5 %

10 %

No Impact (1) Low Impact (2) Medium Impact (3) High Impact (4)

Average3,103,052,952,852,702,302,101,951,901,85

2,59AV 2,0Median



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‣The ranking of business areas impacted by the e-bike introduction is exactly the same like for the estimated impact of e-bike telematics technology.

‣The impact of e-bike telematics is in general lower rated than the impact of e-bike introduction (av. 2,59 comparable to 2,91).

‣Support Activities (R&D and Product Mgmt.) and down-stream (Sales & Service) are expected to be the business areas with highest impact.


��2411. IMPACT ON BUSINESS AREAS 2/2

2 of 2

Prim

ary

activ

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Supp

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activ

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Val

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(by

Mic

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ter,

1985

)





AV 2,68

Inbound logistics

AV 2,88

Operations

AV 2,48

Outbound logistics

AV 2,84Marketing

AV 3,24

ServiceSales

AV 2,96

Prim

ary

activ

ities

Supp

ort

activ

ities

Val

ue c

hain

(by

Mic

hael

Por

ter,

1985

)





AV 1,95

Inbound logistics

AV 2,30

Operations

AV 1,80

Outbound logistics

AV 2,10

MarketingAV 3,10

ServiceSales

AV 2,85

Estimated impact of e-bike telematics

Impact of e-bike introduction

Av. impact of >3,0Av. impact of 2,8 - 3,0Av. impact of <2,8

Primary down-streamMID

Support activitiesMAX

AV 2,46

AV 2,66

Primary up-streamMIN AV 2,13



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‣Over half of the manufacturers surveyed already have plans to introduce e-bike telematics into their new e-bike models.

‣1/5 prefers to wait and check how the new technology will perform and develop before getting active as well.

‣25% are more skeptical and still do not have any plans. They see e-bike telematics rather as future technological development.

20 Participants*TOTAL

��2512. E-BIKE TELEMATIC PLANS

Yes, for next MY!

No, first wait!

No plans yet!

No, first waitMIN

Yes, for next MYMAX

20%

55%

1,70AV 1,0Median



CLOSUREThis presentation is a summary of almost all results gathered by the online survey. A deeper analysis will be available in my master thesis. !

Thanks again to all industry experts that supported me by answering the questionnaire and please do not hesitate to contact me, if you should have any comments or questions.

Survey as part of the master thesis “E-bike Telematics” by Nils Niederheide, MBA in International Marketing !

Published in Feb 2014