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Text | Hou Tian

Editor | Yang Xuran

When it comes to the new favorites that have appeared most frequently in the circle of friends in the past two years, bicycles are undoubtedly on the list.

Bicycles, which used to be just a means of transportation, have now become large toys and social currency for young people.

Cycling is no longer limited to commuting, but has been thoroughly integrated into the lives and entertainment of young people. During holidays, a large number of enthusiasts wearing tights and cycling shoes will ride their bicycles on the streets and alleys, as well as the scenic roads and winding mountain roads around the city.

The trivial daily life and fast-paced work have made more and more young people in urgent need of releasing stress. Cycling, a free, healthy and relatively low-cost sport, has become the way chosen by more people.

As cycling becomes increasingly popular, the industry and services surrounding bicycles are also gradually upgrading. From fully equipped bicycles to various equipment of all sizes, to community organizations such as clubs, the cycling craze has driven the entire industry chain.

01 Phenomenon

Whether in real life or on social media, we can feel the passion for cycling.

According to the data from Xiaohongshu's "2023 Outdoor Life Trend Report", the number of cycling-related notes published on Xiaohongshu in 2023 reached more than 1.8 million, an increase of nearly 400% year-on-year, and the total reading volume exceeded 1.3 billion times. When you open Xiaohongshu and enter the keyword "cycling", what comes into view are young men and women showing off their good figures and a sporty atmosphere.

At present, there are more than 100 million people in my country who ride bicycles regularly, and nearly 10 million people participate in cycling sports. From March to May and September to November, the climate is relatively comfortable and cycling activities will also usher in a "small peak".

Apart from seasonal factors, there are three main reasons driving the "cycling craze":

First, people's health awareness has increased. The "China Health Management White Paper" published by iResearch in 2022 shows that residents' satisfaction with their health has dropped significantly, and the label of health has been upgraded from being free of illness and eating well to being in good spirits, having good resistance, and sleeping well. The survey shows that after the epidemic, 80% of residents began to pay attention to scientific exercise, of which 14% exercise more than 3 days a week, and 38% exercise 1-3 days a week. The improvement of health awareness has led to an objective increase in residents' demand for sports such as cycling.

The second is the boost from social media. On social media, the sport of "cycling" has been labeled with many labels. Some people call it "a symbol of a lifestyle", some call it "a way of self-regulation", and some say "people who love cycling have free souls."Under the gathering and amplifying effect of social media, cycling is no longer just a sport, but also a trend culture for young people. If you don’t participate, you risk being left behind.

Third, cycling has a low threshold and is friendly to novices. Compared with most other sports, cycling has a low entry threshold and does not require high physical strength and professionalism. In 2021, only 5.88% of cyclists had been riding for less than 1 year, while this proportion increased to 11.88% in 2023. As an "easy to get started" sport, cycling has been favored by many novices.

Low barriers to entry, increased health awareness and the boost from social media have jointly contributed to the rapid growth of the cycling market.

In 2023, JD.com's sales of cycling-related products exceeded 1.5 billion, a year-on-year increase of about 54%; Douyin's cycling products grew at a rate of 414.13%, becoming the fastest-growing star category among the platform's outdoor products, and many "Internet celebrity" bicycles were sold out directly.

Cycling is still popular. During the "6.18" event this year, the sales of various bicycles and cycling equipment on the Douyin platform continued to grow significantly, among which the sales of road bicycles and mountain bikes increased by 270% and 190% respectively compared with last year, and the sales of cycling equipment such as lights and meters increased by 240% and 390% respectively year-on-year.

02 Features

Cycling enthusiasts are mainly young people living in big cities, and most of them have a high level of education.

In terms of age distribution, in 2023, people aged 18-40 will account for nearly 70%, making them the main force of cycling enthusiasts, followed by people aged 41-50, accounting for only 17%.

The distribution of cyclists is positively correlated with the level of economic development. Currently, 60% of cyclists live in first- and second-tier cities, and 37% live in third- and fourth-tier cities. Although the threshold for cycling is low, for more enthusiastic enthusiasts, the cost of bicycles, related equipment, and subsequent maintenance is not small, so the distribution of cyclists is also related to income.

In addition, cycling enthusiasts also have a high level of education. More than half of cycling enthusiasts have a bachelor's degree, and nearly 12% have a master's degree or above. Only about 13% have a high school degree or below.

This group of young people in their 20s and 30s living in cities are exactly the ones who have a strong demand for social and entertainment activities.

According to the survey, 75% of cycling enthusiasts often participate in cycling activities. They either "race" with the cycling club team or make an appointment to go cycling at any time. Cycling fills the gap in the social needs of young people in cities. People of different professions and ages become like-minded friends through common interests and hobbies. Many people also find love through cycling.

In addition to socializing, cycling enthusiasts are also keen on sharing, which further increases the size of the cycling group.On social media, there are many participants in cycling-related topic activities. For example, on Xiaohongshu, there are topic activities such as #繁花cityride , #龙年第一骑 , #我是这样女骑 , #春日骑游路书 , etc., with more than 5 million related notes. Checking in, taking photos and sharing routes have become a part of the daily life of cyclists.

If you want to develop a hobby well, "spending money" is essential, especially for cycling enthusiasts, having a good set of equipment is even more important than eating, drinking and having fun.In a survey on the consumption preferences of cycling enthusiasts, 27% of respondents believed that cycling-related consumption was very important, and they attached more importance to it than their daily food, clothing, housing, transportation, and any other entertainment activities.

In terms of the purchase budget, cycling enthusiasts are very willing to spend a lot of money on high-end bikes. Among them, 46% are willing to buy bikes priced at more than 8,000 yuan, and 23% have a purchase budget of more than 15,000 yuan.

In summary, strong sociality, love of sharing, and willingness to spend money are the main behavioral characteristics of the cycling group.

03 Business

This group of young people who are willing to spend money to "chase the trend" have directly promoted three types of business.

The first type of business is bicycle assembly.

As cycling becomes popular, the scale of my country's two-wheeled bicycle market is growing rapidly, and it is expected that the market scale will reach 235.3 billion yuan by the end of this year. At the same time, the profitability of my country's bicycle companies is also increasing.In 2022, the industry's profits increased by 20% year-on-year. In the first quarter of this year, the industry's profits also maintained a high growth rate of 13%.

In recent years, overseas complete bicycle brands have made huge profits in my country, but the profitability of related domestic companies is relatively limited, which is ultimately due to brand restrictions.

At present, my country's bicycle manufacturers mainly engage in OEM/ODM business, and have formed three major bicycle cluster industrial belts in Tianjin Bohai Bay, Jiangsu, Zhejiang and Shanghai, and the Pearl River Delta. Their output accounts for more than 60% of the world's total, but they lack well-known and highly accepted high-end brands.

In the entire bicycle industry chain, bicycle brand manufacturers have the highest status, with an average gross profit margin of nearly 30%. The profitability of OEM and ODM manufacturers is much weaker, with a gross profit margin of less than 15%.

In addition to the lack of brand power, domestic bicycles also have the problem of insufficient localization of mid-to-high-end parts. Take an entry-level road bike with a cost of 5,000 yuan as an example. Its core components include: the transmission is about 2,500 yuan, the shock-absorbing front fork is about 600 yuan, and the chain, tires, and hydraulic brakes are about 350 yuan in total. These core components account for 70% of the cost, and 90% come from the United States, Japan, Taiwan and other places. The domestic self-supplied capacity is seriously insufficient.

Faced with the two major problems of insufficient localization of core components and insufficient brand power, Chinese companies are also upgrading accordingly. For example, Phoenix, a long-established bicycle brand, has strengthened its research and development of high-end bicycles in recent years, creating high-end bicycle sub-brands such as FNIX and Maruishi, and attracting cycling enthusiasts by participating in the China International Bicycle Exhibition.

The second type of business is cycling equipment.

Cycling equipment has many subcategories, including helmets, gloves, bottle cages, bike locks, bike meters, etc. Although the gross profit margin is not high, due to the large market demand, it is also possible to obtain considerable profits by running sales. For example, Rock Brothers, which mainly deals in cycling equipment, achieved a revenue of 1.2 billion in 2023, achieving an annual growth of 30%.

Among cycling equipment, cycling clothing is the most profitable segment in China. The pricing of cycling clothing varies greatly, ranging from tens of yuan to thousands of yuan. The reasons for the pricing differences include many factors such as brand, fabric, and pattern design.Domestic cycling clothing brands are highly recognized by domestic cycling enthusiasts thanks to their high cost-effectiveness.

A sports blogger conducted a survey on cycling wear brand purchasing intention in 2023. The results showed that the top three brands with the highest purchasing intention among cycling enthusiasts were all domestic brands, among which MBO (Meisonland) topped the list with a share of 41.81%.

MBO takes the route of combining functionality and aesthetics and is very popular among female consumers.

The background is that the number of women participating in cycling activities has increased significantly in the past two years. The proportion of women among cycling enthusiasts has increased from 4.9% in 2022 to 7.92% in 2023. Women are very willing to pay a high premium for appearance. MBO has seized the female users with high consumption willingness and faster growth, and achieved rapid growth in sales.

The third type of business is the club.

There are two main models of clubs on the market: one is a paid model, that is, users pay to participate in activities organized by the club, and the club provides services such as leading the team, supplies, route planning, and teaching, which is somewhat similar to the business model of a travel agency.Generally, the cost of a short-distance cycling activity is around 100 yuan, while the cost of a long-distance activity can reach 1,000 yuan or even more than 10,000 yuan.

The other is a car store group, where users can participate in the event for free, and any expenses incurred during the event are AA by the users. The purpose of this model is not to make a profit through the club, but to extend the customer life cycle through activities and promote in-store product sales.

However, at present, clubs of both models are basically only rooted in first- and second-tier cities. The business itself is subject to great geographical restrictions and cannot be scaled up. In addition, due to high operating costs, many clubs are still making losses. They can only achieve user growth through careful operation and word-of-mouth, in order to better realize commercialization in the future.

Currently, the cycling craze is still heating up, and related industries are gradually moving towards segmentation and specialization. If domestic businesses want to seize the "cycling" opportunity, in addition to working hard on quantity and price, they may need to accelerate the overcoming of technical and brand difficulties. After all, the economic value and industrial influence are the greatest.