Sten Van der Ham aims for dealer and consumer, ‘Bicycle trading is more than just selling a bicycle.’
The bicycle industry is in troublous times, in which the market changes in a rapid pace. Of course, these developments are not left ignored by a major player in the industry as Accell Nederland. With this knowledge in mind, Sten Van Der Ham accepted his new job as Commercial Director last September. This week, the news came out that from the first of March, Van Der Ham will succeed Huub Snellen as Managing Director. A perfect opportunity to better get to know the man who is responsible for the marketing and sales of Batavus, Sparta, KOGA and Loekie in the Netherlands.
You are new in the industry, so the first question that comes to mind is: ‘who is Sten Van Der Ham?’
“I am a bicycle-lover, racing bikes as well as mountain bikes, I am married and have four daughters. As a family, we are leading an active and sportive life. Before I started at Accell Nederland I worked in England and Curacao for a big telecommunications company. I get lots of energy from changing environments, which is exactly the theme of my role at Accell Nederland.
As newcomer you have an open-minded look towards the industry. What was the first thing you noticed?
“Especially that the market is changing massively in many ways with new players, manufacturers, and suppliers. It also is a market in which online sales are growing and lots of new brands are introduced. I believe that there currently have been introduced around 90 new bicycles brands in the past six years. Besides that, new component suppliers are entering the market as well. And don’t forget that there are some big technological developments going on, such as the Internet of Things (IoT), MAAS (Mobility As A Service) and 3D-printing. I can say that the market is moving a lot. On the dealer-side and on the manufacturer-side you see consolidation. The role of the consumer in the market is changing because of the rapidly growing access to information about bicycles. The consumer can compare products a lot easier than before and is used to have the products that they bought available immediately. If something is seen today, they want to have it tomorrow. Consumers are looking for more and direct contact with the manufacturers. We see that at KOGA, a brand from which the customers are real fans. The final thing that I noticed, is that because of the introduction of e-bikes, the complexity of the products has increased, which makes the service more and more important.
So, there is a lot of change coming, also at Accell?
“That is right. The integration of our brands in one organization is not finished yet. We are not yet taking advantage of the fact that we have all the major brands under one roof. In the production line, we made some big steps. But on the commercial side we did not do that yet. Accell Nederland has had a lot of internal focus lately, and now it is time to move that focus outside again, to the dealers and consumers. My experiences from the telecommunication industry can be of good help there. At one point, that market was saturated as well, so less business had to be shared by the same amount of dealers. At the same time, the consumer became more demanding and got a more central role in the organization. That’s what we have to focus on in the bicycle industry as well. We have to restructure the distribution channels and put the consumer in a more central position.
You talk about the restructuring of the distribution channels. How do you want to shape those?
“Accell Nederland will start to distribute her brands selectively in 2018. We already have more than 10 years of experience with this kind of distribution with the Batavus-bicycles that have been brought to the market. We saw there that this kind of distribution can make us improve the image of the brand, the satisfaction of the consumer and the safety of the production in the most efficient way. Moreover, it remains possible to decide on the number of dealers, which assures us that they can earn back the investments that they have to make, to be able to sell high-quality bicycles, in an acceptable amount of time. Accell Nederland thinks that these aspects can be of great importance for the future of its brands. We want to create an equal market for all our brands and between all our dealers, online as well as offline. Dealers that commit to us will be rewarded for their efforts.
The introduction of the new distribution channels for all the brands will begin next year, in which we will appoint two different groups of dealers. We are going to invest in stores, but are also going to make more demands concerning the amount of square meters, quality and the position of the Accell logo’s in the stores. We already introduced that policy for Batavus-dealers, and we will start doing that for all our other brands.
Although the aim for this transition is to do it on mutual agreements, terminations cannot be ruled out. It is possible that on certain locations efficiency-advantages can be realized by bundling more brands. We expect that the number of dealers will not grow on a national level during the coming years, but that it will be decreased gradually.
Accell is convinced that with these changes, the future of the company itself and of its dealers will get a firm fundament, which makes all of us ready for the challenging times ahead of us.
You come from the telecommunication sector. What can the bicycle industry learn?
“The central position of the consumer. We see now that the consumer is left alone in the bicycle industry. The contract in the telecommunication sector makes sure that the consumer is taken by the hand whenever he needs contact or service. When a consumer buys a bicycle, it often depends on the dealer if the consumer comes back for service.
That is why we introduce the Bicycle-card, with which we built a better relationship with the consumer, in collaboration with the dealer. The number of the card is linked with the frame number of the bike and the e-mail address of the consumer. The client then gets an digital maintenance-book, that can be consulted by all of the three parties. The consumer gets contacted on time for a first, second and third service. This also leads to more traffic for the workshop or store. If the bicycle is sold after some time, the new owner gets a new Bicycle-card, that is linked to the frame number once again.
Furthermore, we will start to invest in connectivity by equipping more bikes with GPS and a SIM-card, so that the bicycle is in constant contact with the Internet. There is a lot of talking about the Internet of Things. Currently thousands of consumers cycle on a connected Sparta or Batavus. With that, the smart e-bike acquired a substantial part of the e-bike market.
These smart e-bikes have a GPS-connection that registers the rides of the consumer very accurately in the Smart App and gives a signal when the bike is moved unwanted, by setting a so-called ‘virtual fence’. And when the bicycle does get stolen, it is easily tracked again with the track & trace function.
Finally, we will invest more in Accentry, in which dealers can regulate lots of their own business, like ordering bikes and parts and reschedule deliveries. Accentry has a responsive design, which makes it easy to use on a smartphone and tablet. For a dealer it is a very quick and easy way to take care of his business via the Accentry portal at any preferred moment. Our dealer support will of course stay available for more complex questions.
What will happen with the experience centre De Fietser in Ede?
“We are quite happy about our experience centre. De Fietser has proved to be a very suitable location for people who want to orient on a new bicycle, because the total collection of bikes can be found there. Not a single dealer has the same amount of bicycles available for testing, that is why dealers redirect their customers to De Fietser more often. De Fietser brings us, as a manufacturer, closer to the consumer, which makes it easier for us to understand the process and to fine tune our models and development. Since the beginning of January 2018, we have started selling bicycles at De Fietser as well, because the consumer asks for that.
Consumers can place an order in Ede or online at defietser.nl, which will of course be delivered by our dealers. We think it has to be the consumer’s choice where to buy the bike, but the deliverance and service stays with the dealer.
Earlier this year the BOVAG warned for big changes in the market and that, if everyone keeps doing business in the same way as they are used, in a few years 40% of the existing dealers will disappear. Do you share that fear?
“I think it is difficult to judge about absolute numbers or percentages. You can see that lots of smaller businesses have lower costs, because they already bought their real estate. That makes it easier for them to keep their stores open for a while. But the bottom line of a business is to make money, and in the future, if they do not adept to the omni channel developments and the investments that come with that, they will not earn enough. I do expect that the concentration in the dealer-landscape will decide who will make it. Dealers have to choose what they stand for. Who chooses for bicycle sales will have to increase its scale, but one can also choose to focus on service and maintenance. To do both will become very difficult. But if 40% will disappear, I cannot say at this moment.
Lots of newcomers in the market choose for a direct sale strategy, and with success. How does Accell handle that?
“If you look at sales, they seem to do great and appear to have developed a great new business model. But if you look at the service part, I do have my doubts. To be in the bicycle business is more than just selling a bike. You have to be able to deliver service to the customer. A great network of dealers, like we have, is a big problem for direct sellers. The delivery and service stay crucial in the customer journey. We look at a bicycle as a total package and see it as more than just the product. That makes great service and customer care very important. Our bicycles have those features automatically and that is what we have to communicate more with the customer. Those extra’s make the purchase of a bicycle more interesting than just a low price. That makes the quality of our distribution network so important.