Since we announced we would support Team Aqua Blue Sport, several people have reminded me of comments I have made in the past few years. Comments about how I don’t find pro sponsorships interesting anymore, about how it’s often not effective, expensive, frustrating and so on.
Well, it’s true, I’ve said those things, and I continue to say them. In fact, something else that happens to me regularly is to have people from up and coming road bike brands approach me and say “we’re going to be the next Cervelo, we’re going to sponsor a big team and watch our sales explode.”
Ironically, what pros rode mattered more when sponsorships cost less
Here’s the thing:
- That’s not what happened with Cervelo. The pro team sponsorship may have been when many people noticed us, but those were not our highest-growth years. In fact, our first year in the pro peloton was our WORST year of sales growth. That’s not to say the pro sponsorship eventually wasn’t very good for us; it was. But it’s not a magic bullet.
- You cannot do today what Cervelo did 15 years ago. That worked at that time in that situation, it simply won’t work now. Why not?
- Sponsorships were super-cheap back then. We sponsored a good team but paid almost no money. Even when other bike brands started to pay millions, we didn’t. It didn’t get crazy until 2008 when Specialized offered Team CSC 3.5M and then we were out. (As an aside, last year cyclingtips had a whole article about the cost of sponsorships through the years, and when I objected by saying the fees they quoted were way too high, they said “yes, we know you didn’t pay that, but others did.” I knew we paid less than the rest, but I never knew the delta was that big, in fact I still question some of those numbers).
- Pro cycling was super popular, and what the pros rode mattered. Ironically it also mattered because it didn’t cost that much, so when a team chose a bike brand, it meant it chose those bikes. Nowadays, it usually means that brand offered the most money, it doesn’t say as much about the bikes.
- Bottomline, with effectiveness high and costs low, a company like Cervelo could sponsor a top team even when it was small. A small company trying the same today will find that paying 3M without the sales to cover it makes your life hell pretty quickly. And several brands have found that out the hard way.
- Marketing is about being remarkable, which means doing something other people are not doing. You can’t be remarkable following everybody else. Yet that is exactly what the bike industry is so good at. Brands sponsor pro teams because other brands sponsor pro teams. For marketing managers, it’s “safe”, you can’t be fired for doing what everybody else is doing. But it doesn’t make sense. And it’s not just the bike brands that all try to do the same thing, most pro teams are also very similar. And so everybody goes through the same phases, following each other:
- First all brands used the teams just as advertising
- Then one brand starts to do real testing with the team
- Soon all teams say they use the team for real testing (whether true or not is another story)
- Then one brand figures out that this testing is really hard, so they conclude they need their own team to do it well.
- Then a whole bunch of other brands start running their own team (but to reinforce the “remarkable” point, none get the publicity the first team did for starting it, because it is no longer remarkable when you’re not the first)
- Then that trend stops, because it is really expensive unless you find subsponsors (I can attest to that!)
- Then slowly other brands stop having their own teams too.
Of course there are always a few bike brands and pro teams outside of the norm, and I like those, but they are few and far between.
But when I saw Aqua Blue Sport race in 2017, I thought the team was interesting. Why?
- They are doing something different. Everybody is whining that the business model in cycling is not sustainable, but very few do anything about it. Their model of having the budget supported by an online sales platform for any dealer wanting to sell any bike, sort of a “professional eBay for bikes”, has never been tried. Instead of relying on the moods and demands of an outside sponsor, they are their own sponsor.
- I don’t know if that is the solution for pro cycling, I don’t have a crystal ball, but if we agree the current model doesn’t work, then we need people like Rick Delaney to stick their heads out, fund a new model like this for a few years and see if it sticks. And we need more of them, trying different models, and some will work and others will not.
So when somebody told me they were looking for a new bike supplier, I gave them a call. Really more to let them know I liked what they were doing and to offer any help (after all I’ve had my share of pro team building experiences), but also to see if they could be interested in trying the new 3T Strada (which hadn’t launched yet at that time).
I didn’t think the latter part had much chance, after all even sponsorships at the pro continental level now often have a big financial component, and that was something we just wouldn’t an couldn’t offer. The Strada was completely new, so sales started at zero, meaning we could offer product but that was it.
(Another aside, around that same time another pro continental team was also looking for a new bike sponsor and told me “we have an offer for bikes and 400,000 Euro, what can you offer?” So I said “I can offer you advice: take the 400,000 Euro.”)
But this is where the beauty of the Aqua Blue’s business model and our situation came together: They weren’t after money, they were looking for good bikes and for a partner excited about their plans to change pro cycling and with a desire to help them tell the world about it. Well, that bike we had, and that desire too.
Long story short, they tried the bike, liked it, and here we are. We can certainly agree that for now, the goal of telling the world about Aqua Blue has been working. Since we announced they would ride the Strada and 1x, every armchair DS has voiced an opinion on whether that will work in the pro peloton or not. But I’ll leave that for a next blog and in the meantime, I can’t wait to get the season started.