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Velocipede / Snowpede Borrow Bank

Market Analysis Summary

VS has two distinct groups of customers: local customers and tourists .  While many of the media forms that VS will use to advertise will reach both groups, there are some sources that will be used  specifically to target the tourists.

VS faces competition from local retail outlets that also have rentals.  These shops tend to concentrate on the retail side and consequently do not offer the appropriate level of customer service support for the rentals.

4.1 Market Segmentation

Velocipede/Snowpede Borrow Bank will target two distinct market segments:

  1. Tourists- These people are passing through Eugene and are either cycling enthusiasts without bikes or visitors who would like to try cycling. 
  2. Locals- This group of people lives in Eugene and would like to try cycling/snowshoeing so they will go to a rental facility and rent the equipment. There will be a larger percentage of locals renting snowshoes than bicycles. This is primarily because snowshoes are more unusual and it less common for people to own their own snowshoes than for people to own their own bicycle.
Sports equipment rental business plan, market analysis summary chart image

Market Analysis
Year 1 Year 2 Year 3 Year 4 Year 5
Potential Customers Growth CAGR
Tourists 9% 35,645 38,853 42,350 46,162 50,317 9.00%
Locals 9% 39,854 43,441 47,351 51,613 56,258 9.00%
Other 0% 0 0 0 0 0 0.00%
Total 9.00% 75,499 82,294 89,701 97,775 106,575 9.00%

4.2 Target Market Segment Strategy

Velocipede/Snowpede Borrow Bank will have a different strategy to communicate with different target groups. The tourists will be targeted through advertisements published in Chamber of Commerce publications that are released specifically for visitors.

Locals will be targeted through advertisements in the local outdoor free-journal that tracks outdoor activities in Eugene.  In addition to these advertisements, VS will have an ad in the Yellow pages as well as information on the website.

4.2.1 Competition and Buying Patterns

Currently, there are three different retail bicycle shops that rent bicycles and four different retailers that rent snowshoes. 

The typical buying patterns of customers is to call different bicycle/outdoor shops and ask who rents equipment.  Convenience and availability are the typical variables that customers are concerned with.