Retailers benefit from more Partner finance promotions
Posted on in Business News , Cycles News
As Madison gear up to launch their first nationwide 0% finance promotion to thousands of consumers at iceBike*, ACT spoke to Cycle-Trade about how and why more big brands should be using retail finance promotions to support their dealers.
Retail finance is one of the most effective sales tools used by retailers to help boost sales. It gives consumers the ability to afford the products they really want by spreading the cost.
Consumer demand for finance is growing and more bike dealers than ever with over 820 IBDs in the UK now offering retail finance via the ACT's Ride it away scheme. But there is one area where the cycle's market is still lacking - Partner finance promotions (PFPs). Why is it that the big brands in the cycle's market are yet to adopt a promotional tool which has proven success in other sectors such as photography and music?
Since launching in the music industry in 2008 and 2011 respectively, the Yamaha and Roland brand finance schemes have gone from strength to strength and have now become the norm within the industry, providing retailers with an additional sales tool to help close the sale whilst helping customers to afford the instrument of their choice.
With similar price points and type of customers, the cycles industry should be benefitting from PFPs in the same way as the music industry, yet supplier and brand led finance promotions still remain relatively uncommon.
How do PFPs work?
One of the biggest challenges for a brand owner is how to influence a consumer's purchasing decision on the shop floor and Partner finance promotions (PFPs) provides the solution.
PFPs allow suppliers to create promotions in-store using retail finance. It can be used to drive more footfall into stores, convert more sales and to add more accessories into the mix.
The supplier selects a brand, a product range or an individual model they wish to promote to consumers. They can then decide if they would like to make a contribution towards the retailer's finance subsidy costs - suppliers can choose to part or fully fund the subsidy that the retailer would usually pay on any sales made via these promotions.
With PFPs the supplier influences the sale of their products in store, the retailer benefits from increased footfall thanks to nationwide promotion, and the customer buys their dream bike and accessories spreading the cost - a win-win for all.
The ACT's Ride it away scheme now accounts for £70m worth of sales per annum. However, this market could easily be worth in excess of £250m as more dealers come on board, supported by suppliers getting involved with PFPs.
Madison lead the way
Madison have become one of the first to take the lead on Partner finance promotions, driving thousands of customers in-store by promoting 0% finance in participating retailers.
The promotion itself is set to launch at iceBike* 2016 - the first to incorporate a much anticipated consumer weekend - which will showcase all the latest products. However, with a limited number of products available to buy at the show, visitors are invited to take advantage of Madison's exclusive 0% finance promotion, available from participating retailers across the UK.
Any Madison dealer who offers Ride it away can opt in to this scheme and benefit from increased promotion and footfall from thousands of potential new customers.
Visit bicycleassociation.uk/icebike to find out more and to register your shop or visit ACT at the trade days of iceBike*.
Participating retailers will be promoted online via rideitaway.co.uk. To further promote participation in the scheme, retailers should ensure Ride it away is proudly displayed both in-store and online. To help achieve this, visit the ACT stand at iceBike to pick up your free pack of Ride it away swing tags.
Retailers can opt in or out of the Madison promotion at any time.
Any retailers not already offering Ride it away retail finance can join the scheme today and take advantage of this promotion from day one. Retailers should visit rideitaway.biz to request an application pack.
Suppliers who are interested in offering a similar scheme should get in touch with the ACT.
For more information call the ACT on 01273 427 700 or email info@theact.org.uk.