The day you get a new bike is like Christmas, Hannukkah, and Kwanza all wrapped up in one. For those who don't celebrate any of the above holidays, an alternative explanation would be to think of it like the day your cultish icon returns to Earth to bring you and the rest of the flock to Space Paradise. Seriously though, there are a few things worth knowing before you head out to the local bike shops and start drooling.
Production bikes being sold in stores today have frames made of steel, aluminum alloys, carbon fiber, and a few of titanium. Each material has its advantages and disadvantages, and a great-riding bike can be built out of any one of them.
Aluminum is the most common frame material. It is cheap to manufacture, and advances in extrusion technology allow aluminum tubes to be made lighter and stronger than ever before. Some riders tend to think that aluminum frames transmit more vibration than the other materials, making it a less pleasant ride, but the Bro thinks even if this is true that it's negligible. Aluminum also doesn't have the greatest fatigue resistance, and damage to aluminum frames is usually permanent. For price and weight, aluminum can't be beat.
Steel is typically the heaviest and cheapest material to build with, but it also makes for the strongest frames. For riders around 200 pounds or more who think they won't ride in a dainty manner, steel tends to be a good choice. Steel frames can also take the most physical punishment without cracking or breaking, making them a good choice for people who are going to punish their bikes. It is worth mentioning that not all steel frames are equal, however, and high-end frames can be dramatically lighter than cheaper ones while stil retaining their strength.
Carbon fiber is the frame material of choice for those looking for the lightest, fastest bike around. Typically made by layering strips of carbon fiber weave and gluing them into place, carbon bike frames can be "tuned" for different ride characteristics by adjusting the amount and type of fibers as well as where they are placed. For all its aptitudes, carbon fiber has a reputation as being the riskiest material to build a frame with due to the fact that when it fails, it fails "catastrophically" and can endanger the life of the rider. Frames made today, however, have a much better record than their predecessors.
Titanium is often described as providing frames that are as light as aluminum and as strong as steel. Due to the fact that titanium itself is expensive and its production process is quite involved, carbon fiber frames have claimed much of the market that titanium once had. Like aluminum and carbon fiber it won't rust, but it has a tendency to bind to other metal components - thus it requires more dutiful maintenence than the other materials. Titanium is a more expensive frame material, but you could probably hand one of these frames down to your kids if it's maintained.
While the frame may be the soul of the bike, the components are what make it fun to ride. Most new bikes have components that fall into a certain tier of performance - more expensive bikes will have a higher tier, cheaper ones a lower tier. But, in a company's product line, the higher and lower end bikes will commonly have different sets of components while the bike frames are actually identical.
As you look for a new bike, the Bro demands that you try out bikes with different tiers of components. Try something cheap, try something that you definitely cannot afford, then try something at the top of your price range. By doing so, you'll be able to gauge what quality and tier of components match up with different price brackets.
Truthfully, if the Bro owned a bike shop, he wouldn't sell anything equipped with the lowest-tier (i.e. entry-level) shifting components. The middle-tier components often feel dramatically better and are made of more durable materials. What this translates to is that a new bike that I think is worth buying would cost around $1000 at MSRP in a local bike shop.
For road bikes, look for a bike equipped with shifters in Shimano's Tiagra or 105 parts. SRAM's Apex group is their cheapest set but they tend to work quite well.
For mountain bikes or hybrids, I suggest not going any lower than Shimano's Deore shifters. They offer a number of cheaper alternatives, but the Deore's performance is much higher. SRAM's X-5 group is also a good place to start.
There are three really big bike companies in the US: Trek, Specialized, and Giant. Most local bike shops are basically owned by one company or the other. These three companies produce bikes on either end of the cost spectrum - from cheap entry-level stuff to fancy carbon fiber. Other bike distributors are relatively small time by comparison, though that doesn't mean they are worth disregarding. These smaller brands are Scott, Cannondale, Raleigh, Felt, Kona, Fuji, and Bianchi. Furthermore, there are some notable boutique companies like Colnago, Pinarello, Willier, and some others that own much smaller but more prestigious areas of the market.
So what is the actual worth of a name brand bike? As long as you don't buy anything from a department store like Wal-Mart or Target, you'll find that all big-brand bikes are pretty much the same. The frames of almost every bike are made in a few factories in Asia, with only the highest-end bikes being equipped with frames that stand out. The components industry is dominated by SRAM and Shimano. This means that what you'll end up seeing in a bike shop is a bunch of frames made in the same place equipped with one of two sets of components - not a big variety.
The true differences between the brands are quite subtle. Take a mid-range road bike that costs about $1000 from any of the manufacturers and it will almost definitely have an aluminum frame, carbon fork, and Shimano Tiagra or SRAM Apex shifters. What will change, however, is the wheelset, cranks, quality of the saddle and handlebars, derailleurs, and brakes. One manufcaturer might opt for a nicer wheelset but cheaper brakes, while another might opt for a cheaper wheelset but more fancy derailleurs. Overall, though, the quality level of these $1000 bikes won't vary dramatically between any of the manufacturers.
So how do you get the most for your money? Two different ways. First, look for bikes from last season that are on sale. Bikes that have been sitting around for a year or so can have their prices slashed, and the winter tends to be a good time of the year to find deals.
The second method is to buy online where you don't have to pay as large of a mark up as from a bike shop. My favorite internet dealer is BikesDirect.com. They basically sell you bikes with slightly outdated frames, which isn't a big deal, but the component sets they equip the bikes with are phenomenal for what they ask you to pay. From BikesDirect.com, for $700 or $800 you can get a bike equal to what would cost you over $1000 at a store.
Dangers with buying online are having to navigate their warranty department if anything goes wrong, which from hearsay is a hellish experience. Also, returning the bike would be a drag if you end up ordering something that is the wrong size.