Can renting sleds build sales in U.S.? – September 4, 2006

New snowmobile sales were down again in 2005-’06. At this point, that’s not exactly ground-breaking information. So how can the industry start moving units? One possible idea is to introduce potential first-time buyers to the sport through rentals.
According to a study commissioned by the International Snowmobile Manufacturers Association (ISMA) and conducted during the 2005 winter, interest in snowmobiling is high. ISMA targeted outdoors enthusiasts and owners of other motorsports products. Of those surveyed, eight in 10 said they would like to try snowmobiling. That’s the good news. The bad news is that those same people had little idea how to get started and no idea where the trails are. What’s more, most knew few — if any — snowmobilers, but they did express a willingness to rent a sled.
“The [favorable] rating for snowmobiling is really, really high,” said ISMA President Ed Klim. “Rentals represent a good opportunity for all of us in the business — dealers, the manufacturers and PG&A folks. People want to try it; they want to snowmobile. This can be a great entry point.”
However, at this point, the great majority of rental business consists of experienced snowmobilers, not novices. “A large percentage of people we rent to are hardcore enthusiasts,” said Bill Howell, a partner at Yellowstone Arctic Yamaha in West Yellowstone, Mont. “A lot of them have come out before, and they rent instead of bringing their own sleds.”
The story is much the same at Timberland Sports in Bergland, Mich. “The bulk of our business is made up of people who have rented from us in the past,” owner Marlin Hanson said.
Hanson’s shop began solely as a rental outfit 16 years ago, and it added new unit sales in 1999. “I’d say 60-70 percent of our renters are people who have gone through us previously. Probably only 15 percent are new to the sport, which is not nearly high enough.”
Not high enough, but not surprising to John Tranby, Arctic Cat’s marketing and communications manager. “Renting can be an entryway into the sport, but that’s rare,” he said. “Our studies show that most introductions to snowmobiling come from a friend, not a rental.”
Tranby added, though, that rentals can lead to sales in at least one other motorsport. “In the personal watercraft industry there’s a lot of rental to purchase business,” he said.
One problem in the sledding business is that finding a snowmobile rental operator isn’t necessarily easy; it’s unusual to find a rental machine across vast swaths of the traditional snowbelt. Instead, most are concentrated in a handful of high-traffic tourist destination areas, like West Yellowstone, Michigan’s Upper Peninsula and parts of Quebec. And while rentals can lead to a new unit sale, it’s rare that a snowmobiling rookie makes that purchase. Instead, a rental can be used as a kind of test drive for an experienced rider.
“From a customer’s perspective, what better way is there to try out a new sled?” asked Brad Schmier, co-owner of Yellowstone Adventures in West Yellowstone. “Instead of a 15-minute demo ride, you get the machine for a whole day. We get groups of guys who’ll rent three or four models and switch off for the entire time.”
Schmier estimates that Yellowstone Adventures did 3,500 rentals during the 2005-06 season. Many of those translated to a new unit sale — almost always to the renter’s hometown dealer.
“They buy from someone, but not always us,” said Howell. “I’ve had people write and thank me: They tried it out with us and then bought back home.”
Both Howell and Schmier said while snowmobiling rookies make up a small part of their rentals, the novices they do accommodate enjoy themselves. “We have a lot of repeat customers who’ll bring friends that have never done it before,” said Schmier. And their reaction? “They say, ‘Wow, I didn’t know it was this much fun!’ We hear that a lot.”
Klim hopes they hear it even more, though he cautioned that it’s crucial rental operators provide a top-notch machine.
“People want to have a good experience, and some rentals don’t always do that,” he said. “We’ve got so many great options out there. Put them on a sled that they would want to buy.” psb