ESG Data Trends: ESG Analysis on the Bike Market Using AI

Welcome to the latest article in our ESG Data Trends series. Today, we're turning our attention to the growing bike industry, specifically spotlighting Italy's Pinarello. Our aim is to illustrate how health-conscious and ecological trends, increased by the pandemic, have steered the world towards bicycles for both commuting and exercise. Pinarello, as well as many of its competitors, are private companies, which poses a particular challenge to analyze them in depth as the amount of data available is particularly sparse and harder to find. However, with the help of AI tools, this task becomes not only possible but also highly automated.

Bike Industry Trends: A General Overview

• • • • • Long–term Momentum: Online mentions related to the bicycle market have exhibited a consistent upward trend since 2015, peaking in the last three years in the wake of COVID-19.

Figure 1: Bike market volume of mentions over time.

• • • • • Government Initiatives: Notably, a spike in government investment in cycling infrastructure has paralleled the pandemic-induced behavioral changes.

Figure 2: Bike commuting VS. government focus on cycling infrastructure over time.

• • • • • Type-specific Popularity: Among the various segments, E-bikes dominate online mentions, followed by mountain bikes and road bikes.

Figure 3: Bike market breakdown by type over time.

• • • • Digital Ecosystem: The digital facet of the trend reveals that sports data apps, especially those focusing on performance tracking, have gained considerable traction.

Figure 4: Sports data apps and their use mentions over time.

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  • E-bikes: Riding the High Wave

  • E-bikes have captivated attention across the board. They are now deemed a convenient solution to commuting, more so after the pandemic. Geographically, Europe outperforms the US in E-bike mentions, with France leading the charge on urban bikes. Italy, on the other hand, showcases a stronger inclination towards road bikes.

Figure 5: Bike type regional breakdown.

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• The Pandemic Effect on Road Bikes

• The road bike segment witnessed an unprecedented surge in mid-2020, corresponding with pandemic lockdowns. Major players like Specialized, Trek, and Canyon lead in online mentions, but Pinarello holds its ground with a stable and slightly growing competitive share.

Figure 6: Road bike market data share by competitor over time.

• • • • • • Consumer Preferences: Performance and quality emerge as the dominant positive attributes, whereas cost remains the primary consumer concern.
            
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          • Attribute Sentiment: When analyzed based on sentiment, customization, and performance, score the highest, whereas cost ranks the lowest due to consumer complaints.
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Figure 7: Road bike market attributes sentiment.

Case Study: Pinarello

Online Reputation Insights

The volume of online mentions for Pinarello has seen a steady climb, particularly after 2021. Quality and performance have risen as positive attributes, while cost remains a predominant negative sentiment, inflamed further by recent discussions about the brand's pricing strategy.

Figure 8: Pinarello attributes sentiment.

ESG Analysis of Pinarello and the Bike Industry

• • • • • Low-risk ESG Profile: In general, the bike industry fares well in ESG evaluations. The risks usually center around social and governance aspects.
          
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        • Social Risks: These primarily relate to product safety, with several recalls from various companies, including Specialized and Trek.
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        • Governance Risks: Pinarello has faced patent infringement claims, while other brands like Giant have been accused of fraudulent behavior.

ESG Positive Impact Initiatives

The industry, by and large, is aligned with environmental sustainability goals. Trek stands out for its environmental initiatives and social opportunities, while Canyon demonstrates advances mainly in the environmental management of the supply chain.

As for Pinarello, the brand has undertaken ESG-positive initiatives, notably in environmental and social spheres. Product innovations like the Nytro E e-bike and high-performance 3D printed bikes signify their commitment to sustainable technology. Moreover, their partnerships and sponsorships aim to uplift local communities.

Navigating ESG Goals in the Bike Market

The bike market, led by brands like Pinarello, demonstrates significant strides in alignment with ESG goals. For private equity firms and asset managers, the value lies not just in financial returns but also in understanding ESG risks and opportunities that could influence long-term sustainability and risk mitigation.

How can SESAMm help you track ESG performance using AI?

We combined natural language processing with billions of textual web data related to the bike market to produce this analysis. Using NLP-powered models gives us an edge as we can extract ESG, SDG, and financial insights that aren’t necessarily obvious or easy to detect. These insights help investors make better investment decisions. SESAMm leverages AI and machine learning technologies to help you decipher and understand timely sentiment, trends, and ESG metrics on public and private companies to assist organizations in risk mitigation and profit generation strategies.

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