The Business of Electric Bikes and the Future of Mobility

Primarily attributed to the pandemic, increased demand for bicycles since 2020 is well documented. The industry is hoping the trend will continue even after COVID releases its grip around the globe. Research has shown that new riders tend to upgrade after their first year, and at the very least, those who stick with cycling will continue to need parts and servicing. However, there's a less talked about factor impacting cycling sales and demand figures: e-bikes. 

There are a few reasons for the growing popularity of e-bikes. One is a trend toward outdoor recreational activities, which is heavily influenced by the pandemic, of course. But there are other explanations. 

Many e-bike brands have targeted younger adults living in big cities. This group tends to view cycling as a viable, if not the preferred, alternative to commuting by car. Not only is it healthier, but it allows them to avoid the downsides of vehicle ownership, such as insurance, gas, maintenance, and parking. 

There's also a growing e-bike market in retiree-aged groups. The advantage of the motor makes cycling a reasonable option for active older adults. It even opens the doors of riding to people with health complications that may not otherwise be capable of utilizing a traditional bicycle. 

It's probably also worth noting that favorable regulatory frameworks promote the use of e-bikes in certain markets. Several U.S. state legislatures have revised laws that once classified e-bikes as scooters or mopeds that required licensure and registration. Elsewhere, just this summer, the E.U. passed legislation to exclude e-bikes from insurance obligations. 

The Proof Is in the Sales 

To put some detail behind the anecdotes, e-bikes sales in the United States rose from $8.3 million in February 2019 to $18 million in 2020. By February of this year, that figure had spiked to $39 million (market research from NPD and the advocacy group People For Bikes). 

In Europe, 3.7 million e-bikes were sold in 2019. The figure is expected to increase to 17 million by 2030, according to a report from industry-supported lobbyist Cycling Industries Europe (CIE), industry association CONEBI and user group organization European Cyclists' Federation (ECF). The same report forecasts a downward trend for standard bicycle sales over the next decade. 

The Opportunities for Brands 

Because of their novelty, e-bike brands have a challenge to educate consumers. Even e-bike buyers often need additional information, as demonstrated in a recent BBC News article. Many U.S. e-bike users don't even know into which of the three industry classifications their bicycle falls. 

The confusion can be understandable, and the rules are different in different markets. For example, in the U.K. and European Union, e-bikes must not deliver any power without the rider having to pedal, and the motor must never produce more than 250W of continuous power. 

Vice President and G.M. of Bosch eBike Systems Americas Claudia Wasko points out in the article that the media and marketing materials also play a role in misinformation and confusion, which could hinder the uptake of e-bikes. 

"Using them on facilities designed and designated for the use of bicycles and e-bikes may result in user conflicts, may be illegal if being ridden in areas designated for bicycles, or if equipped as a bicycle, may jeopardize efforts to promote uniform laws and gain wider acceptance,"

The relatively high cost of e-bikes could deter buyers who might feel inadequately knowledgeable about them. E-bike brands don't and shouldn't want to be merely transactional with new users, especially in a sector that's just beginning to sprout. As this market evolves, brands have a unique opportunity to turn buyers into loyalists and advocates. 

The best way to create those tribes is to educate and activate users. NFC technology like WaveOn's RelationTech makes it easy for brands to develop memorable and beneficial experiences with customers, earning trust as they guide prospects through the research process. Post-purchase, RelationTech allows buyers to register their bicycles, provides advanced theft prevention and recovery, and a system to maintain transparent service history. 

Pioneering e-bike brands finally appear poised to cash in on their visions. But a focus on just selling units, without keeping that visionary mindset on how to secure long-term customers and differentiate, will influence which end up as legacy brands and which will become footnotes to the birth of the e-bike craze.