How A Start-up Grows and Becomes so Big They Need CRM To Increase Sales and Reduce Costs

Trek Bicycle began was founded in 1976 by Richard Burke, president of flooring and appliance distributor Roth, and Bevill Hogg, owner of a chain of bike stores. With $25,000 in seed money from Roth’s parent company, Intrepid, Trek started to build bikes by hand in a Waterloo, Wisconsin barnTrek Bicycle began was founded in 1976 by Richard Burke, president of flooring and appliance distributor Roth, and Bevill Hogg, owner of a chain of bike stores. With $25,000 in seed money from Roth’s parent company, Intrepid, Trek started to build bikes by hand in a Waterloo, Wisconsin barn.

Today, Trek designs and develops its bikes at its worldwide headquarters in Waterloo, Wisconsin or at its design facility in the Netherlands. The manufacturing of its bikes takes place in the U.S. and Asia (under Trek oversight), with select town bikes assembled in Hartmansdorff, Germany. Trek Bicycle sells its bikes around the world through about 1,700 retailers in North America, subsidiaries in Asia and Europe, and distributors in 90 countries. Trek’s 2011 sales totaled more than $800 million. The company sold 1.5 million bikes worldwide that year. Richard Burke’s son, John, runs the company as president.

From its beginning, Trek targeted the prestige bike market. The firm introduced its first mountain bike line in 1983 and the first bonded-aluminum road bike — the Trek 2000 — in 1985. The lightweight Trek 2000 was greeted enthusiastically by serious riders. This was followed by a carbon fiber road bike in 1986. Hogg departed from the company in 1986. And Burke, who had held an advisory role, took over day-to-day operations and presided over the company’s return to profitability.

Amid a U.S. bike industry slump in the early 1990’s, Trek focused on overseas sales and overcame European snobbery toward American bikes. It also moved into accessories and began manufacturing helmets in 1993. That year, the company bought Gary Fisher Mountain Bike, founded by the inventor of the mountain bike. Trek bought two more mountain biking competitors, Bontrager and Klein, in 1995.

“We wanted to spend less time managing servers and infrastructure and more time developing features which provide value to our customers.”Adam Salvo, Development Operations Manager, Trek Bicycle Corp.

Intrepid, Trek’s parent company, changed its name to Trek in the latter half of the 1990s as the company divested itself of its non-biking businesses. In 1997, Burke’s son, John, became president of the bike company. In around 1989 also Trek expanded into foreign markets, opening subsidiary offices in the UK and in Germany. To increase production efficiency, Trek stopped bonding its aluminum bikes in 1998, adopting the more common practice of welding .

In June 2002, the company’s president was appointed to the President’s Council on Physical Fitness and Sports. Seeking to further boost its European presence, the company purchased the bike division of Villiger, a diversified Swiss company, later that year. The purchase included bicycle factories in Switzerland and Germany.

Although it’s a global leader in bicycles, Trek maintains the spirit of a small company. This includes its close-knit, collaborative staff and independent bike shops that sell Trek bikes and gear. These trusted partnerships are the backbone of Trek’s business model. When sales reps leave or retire, it can take years to rebuild the depth of knowledge and the rapport that the reps had established with the bike shops in their territory.

“In my job, there are always a couple of things I am trying to kill: bad process and hardware. Microsoft has helped us to do that. The less stuff I have to manage, the more time I have to focus on the important things in life.” David Peterson, Enterprise Collaboration Manager, Trek Bicycle Corp.

Ultimately, Trek’s success depends on close, supportive relationships between its sales reps and the owners of the stores it sells through. Trek is committed to its 5,000 independent bicycle retailers around the world. To support them, Trek offers an Ascend retail management system that manages inventory, places orders for parts, tracks work orders and processes customer’s purchases.

Trek worked with a data center provider to operate and support these services. As the company grew, supporting these services got more expensive and complicated, requiring more servers and IT staff at both Trek and the data center. This began increasing operating costs. And it could take from two to six weeks to install a new server at the data center, which was not fast enough to easily scale with demand for bikes.

But with so much information coming in, the bicycle maker realized it needed a more efficient and effective way to capture and manage the wealth of information its sales reps accumulated as well as to facilitate employee collaboration that would result in better customer experiences, loyalty, advocacy and referrals.

So Trek decided to make some changes to how they did business so they could have a more complete picture of customers and their data and as a result, they could provide better customer experiences and service.

Integration between Microsoft Dynamics CRM Online and other enterprise data sources, including Trek’s JDE ERP system, has helped develop a more complete picture of Trek’s retailers and customers, while the introduction of Yammer has enabled people to collaborate within Microsoft Dynamics CRM Online—replacing email and instant messaging for certain workgroups. And Microsoft Dynamics Integrated CRM Solution helped Trek to support sales reps in bringing all of their customer information into one place, standardizing workflows, and making it quicker and easier for its employees to find vital information.

Trek was also able to improve web sales and customer service by connecting Microsoft Dynamics CRM Online to its public website, where the system captures customer inquiries from a Web form and routes them to the appropriate technical representative. The automated workflow attached to these forms has reduced response times from two weeks to only a few hours, increasing customer satisfaction.

There’s lot’s more that David Peterson’s team did… so make sure to get the full report!

@drnatalie

VP and Principle Analyst, Constellation Research, Connecting Marketing, Sales and Customer Service Through Great Customer Experiences

Join us for the Connected Enterprise Conference at Half Moon Bay – Oct 29-31st!

 

 

 

 

 

 

Share