In considering business expansion, there are various factors to be considered to ensure market success and these include the current business environment of bicycle industry. Since Bob is thinking of expanding his business in the marketplace, it is important to provide the analysis of business environment of bicycle market in London. Business Environment in Cycling: London In London, it is said that cycle journeys have risen by 100% in the last years and are expected to grow more with the existence of industries and companies (BBC, 2008) like Bob’s industries.
Accordingly, cycling industry in London has been increasing because of the vision of the city to be developed as a commendable sustainable world city (Cycling Action Plan, 2004). This is due to the substantial health and personal and economic benefits connected with cycling which could potentially be incorporated with their daily living for 28% of Londoners with access to a bike (Heywood, 2004). In terms of business environment, Bob decision to expand his business in London can be considered as a good decision because of the current trends of the cycling market in the city.
Accordingly, there has been quite rapid development in London cycling market since 2003. This is shown by the 17% p. a. increase in cycle trips on the Transport For London Road Network, while the 43% growth in cycle mode share for traveling into central London between 2003 and 2006. The main reason for such increase is a mix of push factors like the aspect of road congestion and pull like health factors. Other aspects that trigger growth includes the changes in the personal perceptions of the people in London specifically change in job location and home (See Figure 1). Figure 1 Cycle Trips in Major Roads
Bicycle industry in London has potentialities because of the demands of the target market; however, it can also be perceived that because there are other bicycle industries in the London market, there is a possibility of entrant’s barrier for the company of Bob. Hence, in order to solve this issue in the market, Bob should be able to conduct effective marketing campaign in promoting his business in the city. Marketing Demographics The profile for the potential customers of Bob Bicycles consists of the following geographic, demographic, and behavioral factors: It is said that the immediate geographic target of the company is London.
In terms of demographics, the company’s market segment includes male and female whose age ranges from 25 above. In a study conducted, it is noted that commuter cycling in the city is mainly dominated by white males with ages ranging from 25-44; this is because women is facing more barriers in cycling than men (See Figure 2). Most cyclists are also employers and employees who have seen the benefits of cycling with their health, economic and personal factors. As can be seen, children are not considered as a potential market since London is not allowing children to use bicycle for transport.
Aside from this, other factors to be considered in the demographics of the potential customers of Bob includes the levels of bicycle usage, reasons for use, behavioral factors and geodemographic factors. Figure 2 Profile of Commute Cyclists 2006-2007 Behavior Factors In terms of behavioral and cultural aspects, it can be said that Bob bicycles can be considered to have a big potential in London because of the high quality bicycles of Bob which meets the current trends in the bicycle market. In addition, there is a value attributed to the used of bicycle as a means of transport.
There are various attitudes to cycling that should be considered by Bob in the London market (See figure 3). This result was based on the study conducted by TFL Omnibus Survey in 2007. Most of the perception of the individuals with regards to cycling is its economic, personal and health benefits. Figure 3 Attitude towards Cycling Based on the analysis, it can be said that Bob’s plan of expanding his business in the London market, is very feasible and potential based on the current trends in business environment and the pool of demographics and potential target markets.
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