Here's today's burning question: Does the tradition of rolling out new bikes each year still make sense? The "model year" system has been alive and well in the bike industry for decades now. You know how it works—every year, sometime between Eurobike and the annual Christmas-shopping orgy, new fleets of bikes roll into bike shops.
It's a new year, so we must have "new" bikes, right?
Well, maybe. And then again, maybe not. While the model-year production cycle might make sense for car dealerships desperate to lure you into years of credit-card bondage, many observers have pointed out that the same phenomenon seems a bit pointless in the bike industry. After all, bike models don't usually undergo wholesale transformations every 12 months. Why, then, must we keep rolling out "new" versions when the most noteworthy change many a model will undergo from one year to the next is limited to it transitioning from a "Violent Eggplant" paint job to something in a fetching "Enduro Blue"?
Clearly, there are two sides to this coin. Plenty of bike companies (particularly the larger ones) still adhere to the model-year system. A growing number of small to mid-tier companies, however, follow a more on-the-fly business model in which they update existing models as new components become available and only roll out "new models" when they've actually updated the chassis. Which system makes more sense and how does all of this actually impact the average rider? We put the question to Andrew Juskaitis, Global Marketing Manager at Giant Bicycles, and Josh Kissner, Santa Cruz Bicycles' Product Manager.
So, what are the general benefits of bringing out new versions of bikes every year?
Even when there isn’t a significant frame update to a bicycle series (i.e. Anthem, Trance, Reign, Glory etc.), the component specification, frame details and colors/graphics always progress—which translates into providing customers the very best product (i.e. up-to-date) that they can purchase.
In some cases where market change is not as dynamic, such as select youth bikes as well as our Momentum line of mobility bikes, we do apply the “carry-over” concept where a model year can last a few years—but these are rare exceptions to our standard procedure of model year.
Similar question, but a bit more pointed: Why does the model year system work well for Giant?
Like car brands, model year has a practical use for us in terms of cataloging/bike dating/ bike tracking. This is especially important for customer service/support reasons. With over 156 models in the Giant USA product line (and over 500 in the global lineup), from a production/logistical standpoint, we simply have to organize this massive product range by model-year. Simply put, we HAVE to change SKU’s every year to keep production/warranty/sales on track.
But what if a brand like SRAM rolls out a new, awesome component like they did with Eagle in the middle of the year. Let’s say some new drivetrain rolls out to the public in April of 2018, but the model-year 2018 Giant models sold at bike shops in late 2017 or winter 2018 don’t have those new components. Doesn’t that suck for consumers who want the latest parts on their complete bike? Wouldn’t the consumer get a better bike if Giant had a more flexible, on-the-fly system where new bikes are rolled out and updated, based on the availability of new parts?
So, what you just described there might be a great idea for a smaller brand that has that kind of flexibility, but would be a fairy tale proposition for a brand of our size. Small to maybe mid-size brands, like our friends at Pivot, may be able to move that quickly, but keep in mind that we own our factory, and at that factory every minute of production on every single day is booked one year
in advance; so it’s simply impossible for us to take advantage of something that suddenly pops up mid-year like that.
Now also keep in mind that we, Giant, are big enough that we have significant pull with component manufacturers. I know that might sound arrogant, but it’s just a reality for us because we make and manufacture more quality bikes than any other brand, particularly when you factor in the bikes we build for others. The bottom line is that companies at Shimano, SRAM, Fox or RockShox come to us first and work with us to make sure that the timing of the release of their components is sync’d up to our manufacturing process.
Sometimes that works out. Occasionally it doesn't work. The new Dura Ace, for instance, will be available in April and that’s just not the right time for us, but sometimes component manufacturers will delay the availability of a product so that we can get it on our bikes first. We just have that kind of mass to make that happen.
So is this a question of scale then—does model-year bike production just make better sense for larger brands?
Absolutely, it comes down to company size. Naturally, that’s a double-edged sword—it has its pros and cons too. Again, we have to plan every minute of every day for production in our factory so that we are not going to be able to jump on something mid year that suddenly pops up because again, for us everything is negotiated 12 months in advance.
That mid-year component release is also, to be fair, a recent development in the grand scheme of things, isn’t it? There was a time when brands like Shimano rolled out their new components at Interbike—so that they were timed with the debut of new bike models. Product launches almost always happened on a very set and predictable calendar—typically between June and September. The advent of “next year’s” suspension forks consistently debuting in April, during Sea Otter, has been going on now for less than a decade.
Sure. It’s been going on for something like five years now. But showing a new product at Sea Otter and saying something like “The new Dura Ace disc brake will be available soon
” isn’t the same thing as actually making the new disc brake available at Sea Otter. Marketing folks are trying to launch products at what they feel is the right time of year, but when will that product actually be available for us to actually put on our bicycles? That’s an entirely different question.
We’ve been burned on that a number of times in the past. For example, when SRAM hydro [ed. hydraulic road disc brakes] came out, we were very excited about putting that product on a bunch of our ‘cross bikes, so we built two bikes, using SRAM hydro…. Then lo and behold: production delays, production delays, production delays…
It was so bad that we had to cancel those models. The same thing has happened with other component brands that bring out new products that, for a variety of reasons, just arrive too late in the production cycle for us to put on our bikes.
In short, we’re a little gun shy about new products showing up at Sea Otter or some other launch in April or May—what really matters for us is when that product is going to show up at our factory.
So you’re saying that consumers may have an expectation that you should have those new parts on your bikes mid year, the moment they show up at Sea Otter, when many of those products are still months away from being available to anyone?
Absolutely. There is just no way you are going to see a product at Sea Otter and Giant is going to launch a bike in July with that product on it. That timing is far fetched.
But again, Giant is so large a company and customer of those component brands that we’re often involved with new products a full year ahead of even early-season events like Taichung Bike Week—which is when a lot of other brands often first see the new components coming down the pike. So we generally stay ahead of the curve already when it comes to spec’ing the latest and the greatest.
For instance, Fox has a new electronic suspension system in the works and we’ve been riding every iteration of that suspension for the last three years. There are very few surprises for companies our size. We are aware of just about everything that will be important that’s coming down the line and we jump on those trends that we think will be advantageous for the rider.
Does the model-year system help or hurt bike shops?
That’s a great question. While it seemingly might cause dealers and consumers some headaches, what really matters to the rider is that they can rest assured that every year the product line improves-with the very latest frame updates, component specification and colors/graphics that they desire for their hard-earned cash.
I will say that because of who we are—because we are so big—the model-year system helps bike shops order the right product. It helps us keep inventory and manage inventory of the right product. Now for your consumers at the other end of the computer, it can be a bit confusing, I can imagine, or off-putting. But because we are so big and because we want to have great product with the latest and the greatest stuff on it, and because want to to keep track of our products...model year is just a necessary thing for us. It helps us make sure that, at the end of the day, the consumer gets the best possible bicycle from us.
Santa Cruz has never been a strict model-year kind of brand. Why not?
We have had what we consider to be model years for as long as I can remember, and I've been here since 2001. Maybe we're just a bit more flexible about what that term means, and are willing to make exceptions more than other bike companies. One way we differ from our larger competitors is in our willingness to introduce new models or changes anytime we feel the bike is ready. Our engineering team is always working on new stuff, and we call the bike done when its ready - not based on some arbitrary time of the year. I suppose we could finish a project and just hold it until later, but why wait? So we generally just introduce bikes when they are done and ready to ship. We're way too excited to sit on that stuff for months.
In addition, we build all our wheels and bikes in our factory in Santa Cruz—and the team in assembly would get bored if they didn't have new bikes to build all year round. A new model intro in the fall or winter keeps things moving and we have great riding all year long on our local trails—so it's more natural for us.
Generally though, we don't introduce a new bike right before there are some big changes coming. For instance, we had to hold the recent Nomad back a month while we waited to get the latest suspension, GX Eagle, and the new Code brakes from SRAM. Well worth the wait for all of that stuff, and our dealers and customers end up much happier.
We haven't always done it right, but we're getting better. Our customers aren't the least bit shy about giving us feedback/criticism (not even a tiny bit) and we try to listen.
Is this just a question of scale—does the model-year system simply make better sense for larger brands and less sense for smaller brands?
The model-year system makes sense for all of us, but certainly is more critical for larger brands. It is a bit hard on dealers (and manufacturers like us) to be so predictable, as I think people have learned what times of year are good for buying bikes, and when it's not. We'd rather be selling bikes all the time. I suppose we could purposefully be more erratic, but we'd rather deal with the former than feel like we're trying to trick anyone.
Most companies that don’t release a new version of each model in their line every year tend to be smaller brands. That was certainly true of Santa Cruz at one point, but the brand has clearly grown since the `90s. Given the PON acquisition, Santa Cruz seems poised to only grow larger. Will Santa Cruz eventually move to a stricter model-year bike roll out?
If you look waaaaaay back to the olden times (like 2005), bike parts didn't change nearly as often. An XT group stuck around for 5 years. Rear shocks didn't change for maybe three years. Back then, we could get away with rolling in changes when convenient, and it wasn't a big deal. We offered eight colors, so we didn't need to change them.....practically ever. Nowadays bikes are so competitive and quick-changing, I can't imagine going back to that pace. It's a lot of work for everyone, but look at the bikes we're riding now!
As far as the new owners, it doesn't impact that part of our business. We're still building bikes in Santa Cruz, and still have the same people and systems in place that we had three years ago. The big change is that we now have the resources we need (more engineers!) to make wheels and new bikes and keep everything on top of its game. That includes new paint schemes on a regular basis as well. No one wants a Sriracha color Hightower if all their riding buddies have them already. And we get bored of them too—we need to keep things fresh.
Does the model-year system help or hurt bike shops?
I think the upsides outweigh the downsides for shops. Things have to change at some point to keep making improvements. The model year system at least adds some predictability to the cycle. I've certainly heard shops ask for a bit more stability/longevity so they can keep product on the floor current for longer, and that would be really convenient for us too. But having awesome product that is the absolute cutting edge will always be win out. New bikes get riders stoked.
I'm happy that the industry has more or less settled on a system. Not sure if the time of the year to make changes is necessarily the most ideal, but it could be worse.
Does the model-year system help or hurt the average rider?
I'm not sure if it hurts or helps... I guess it depends on when somebody wants to buy a bike. If you want the latest and greatest, time your purchases appropriately as an early adopter. If you don't, just look on the used market after the bike you're looking at gets a freshening up.
I certainly hear and understand the people who are concerned about the resale value of their two-year-old carbon spaceship, but you can't have it both ways. Either you want the super-rad shit that was just introduced, or you don't care as much. Fine either way, there will always be something to ride. Just don't get the latest thing and then ask that the whole world takes a pause while you get your money's worth and sell it on (to finance your next spaceship)!
Does refraining from the model-year system allow some bike brands to be more responsive to mid-year product releases? In other words, does it allow you to shift spec at any point in the year if new forks, brakes or drivetrain components suddenly become available?
Where we differ from a lot of other companies is that we build all our bikes in-house, they aren't assembled in Taiwan or China and sent in a container to a warehouse twice a year. Our agility and ability to make exceptions to the model-year rule comes from the fact that we make bikes to order in our Santa Cruz Factory. If someone comes out with a new part that is just too life-changing for us to wait, we can make it happen quite quickly. I just have to bribe our purchasing team with beer and sample bike parts! This is our advantage as a smaller company that builds bikes ourselves every day. I can walk 50 feet and talk to our operations team, and go downstairs to the loading dock to see if new widgets have arrived yet. And if there's confusion about a mid-year change, we're all in the same building and can deal with it—it's not endless meetings with people from far-away lands.
Some industries are very wedded to model-years. The automotive industry is a good example. Other industries—such as the tech sector—seem to simply roll out new products as soon as new technology arises. Where should the bike industry fit in all of this? Does it make sense for us to continue along with the model-year approach to rolling out new product?
I couldn't say what drives the car industry to be so strict with their model years, but you need the year of a car's manufacture to determine its value, used or new. I'd hypothesize that the tech industry can be so flexible because they can update their products in a less obvious way, through software updates. Completely new models don't come out as often, but when they do come, it's usually timed strategically—almost like a model year. I'm pretty sure the iPhoneX timing to come out just before holiday shopping isn't coincidental—and big tech companies have conferences annually where they introduce new products. Hardware isn't visibly dated with a time-stamp (or model year) because they use software that is revised regularly, and people are comfortable with that system. We could call bike names with version numbers and update part spec & color at random times, but I'm not sure there is any reason to do that...