Nextbike hits the road as ad revenue dries up

  • Advertising
  • November 10, 2010
  • StopPress Team
Nextbike hits the road as ad revenue dries up

It seemed like a promising start—and it also seemed like a win-win scenario—but the commercial realities have hit home for public bike provider Nextbike and it has been forced to suspend its operations and remove its bikes from the Auckland streets due to a lack of advertising revenue.

Nextbike's marketing manager Glenn Shaw says the decision to shut up shop after three years is particularly disappointing because the number of Nextbike riders is on the up.

"However, despite great cornerstone media partners like Resene and Hubbards, Nextbike ‘Media’ is not making enough to fund the overall operation," he says.

On closure next Friday four roles will be lost, but Shaw says the company, which won the Sustainable Business Network's Emerging Small and Medium Business Award this year and recently announced plans to expand into the North Shore, is still looking at a way to develop a restructured funding model that isn't so reliant on advertising sales.

Almost all public bike schemes overseas are part or fully funded by local government and while there has been some tension between the two protagonists in terms of the Auckland offering during its formative years, he says the company is hopeful it can be ressurected and is rallying public support via Facebook at Nextbike Rider.

Nextbike's founder Julian Hulls says it had great results last summer with clients including Hubbards, Resene, Open Polytechnic, Contact Energy, Monteiths, ARTA, New World and Yealands. But this summer "we’ve not made enough to keep supporting the physical bike infrastructure and providing free transport to our 2500 members. As a solely advertiser funded model, Nextbike is too fragile".

Hulls is optimistic that with the change in Auckland's administration and a renewed focus on improving public transport for Auckland to make Auckland the world’s most livable city, "bikes as public transport for Auckland can work and will again."

"While we are genuinely saddened to broadcast this news it’s not without its positives. Nextbike was the southern hemisphere's first public bike scheme and the only scheme globally to provide helmets with the bike. We have over 2500 members, up from almost 900 in October 2009. We operated over 55 rental locations city wide. Over 50 percent of all Nextbike rides have been provided free to Auckland as short trip A- B public transport. Over 85 percent of our members are from Auckland, 92 percent from New Zealand, so Kiwis are ready for public bikes. In the time Nextbikes have been on the streets public bikes systems around the world have grown from 17 cities to over 201 cities to date."

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