Loyal brand community which keeps active through clubs, events, and a museum
Licensing – The Company creates an awareness of the Harley-Davidson brand among its customers and the non-riding public through a wide range ofproducts for enthusiasts by licensing the name "Harley-Davidson" and other trademarks owned by the Company.
The total heavyweight (651+cc) motorcycle market is comprised of the following five segments:Traditional (a basic motorcycle which usually features upright seating for one or two passengers);Sportbike (incorporates racing technology, aerodynamic styling, low handlebars with a "sport" riding position and high performance tires);Cruiser (emphasizes styling and individual owner customization);Touring (incorporates features such as saddlebags, fairings, or large luggage compartments and emphasizes rider comfort and load capacity); andDual (designed with the capability for use on public roads as well as for off-highway recreational use).
Measures the success of this strategy by:monitoring market shares (where available) across its various customer definitionsmonitoring brand health in various markets
Harley-Davidson became quite liberal in its licensing policies, allowing many products with no connection to motorcycles or the biker lifestyle to be licensed
one should not put all their eggs in one basket, which is exactly the faux pas being committed here by Harley-Davidson in its product offering. Businesses, especially public ones, should always have an eye on sustained long-term growth, and a key element to that goal is a well-diversified position in their appropriate industry.
New hybrid motors using alternative energy sources
The brand need to focus on the quality and not on cheap productsFocus on your brand values. If your values are ‘strong, masculine and very rugged,’ you shouldn’t be selling perfume or wine coolers. A range of baby clothes may also be a bad idea.Don’t alienate your core customers. For brands that inspire strong loyalty, the temptation is to test that loyalty to its limits by stretching the brand into other product categories. However, this is a dangerous strategy and can lead to what marketing experts refer to as ‘brand dilution’ – in other words, a watered-down brand.Remember that more is less. ‘When you study categories over a long period, you can see that adding more can weaken growth, not help it,’ writes Jack Trout in his book, Big Brands, Big Trouble: Lessons Learned the Hard Way.‘The more you add, the more you risk undermining your basic differentiating idea, which is the essence of your brand.’Keep it tight. Harley Davidson built its brands by staying true to what it does best, namely making big, classic, US motorbikes. The further it moved away from this original focus, the further it got into trouble. Any brand which attempts to be a ‘Jack of all trades’ will ultimately fail to carve a strong identity in any category.Handle ‘lovemarks’ with care. According to advertising guru Kevin Roberts, truly successful brands don’t have ‘trademarks’. They have ‘lovemarks’. In a now famous article for Fast Company magazine’s September 2000 issue, Roberts cited Harley Davidson as a supreme example of a lovemark and commended the company for not following the marketing rulebook.
From 1903 Until Now3 An American motorcycle manufacturer, founded in 1903 in Milwaukee, Wisconsin and incorporated in 1981 4 young men experiment with internal combustion in a tiny wooden shed. Not only does the shed not burn down, but the motorcycle they build goes on to serve for over 100,000 miles! 12/18/2012
Product Offering Mix Motorcycles and Related Products4 Motorcycles • Five segments: Traditional, Cruiser, Touring, Sportbike, and Dual Parts and Accessories • Comprised of replacement parts (Genuine Motor Parts) and mechanical and cosmetic accessories (Genuine Motor Accessories) General Merchandise • MotorClothes® apparel and riding gear Licensing • Licensed products include t-shirts, vehicle accessories, jewellery, small leather goods, toys and numerous other products Harley-Davidson Museum • Harley-Davidson Museum and Archives, a restaurant, café, retail store and special event space Other Services • Service and business management training programs , customized dealer software packages and motor rentals 12/18/2012
Product Offering Mix Families Of Motorcycles5 Dyna Sportster Softail Touring V-Rod Engines Related Brand Extensions 12/18/2012
Product Offering Mix Financial Services6 Wholesale Financial Services • Provides wholesale financial services to Harley-Davidson dealers Retail Financial Services • Instalment lending for the purchase of new and used Harley- Davidson motorcycles Insurance Services • Offers point-of-sale protection products and sales training to Harley- Davidson dealers in both the U.S. and Canada Funding • Diversified and cost effective funding strategy is important to meet HDFS goal of providing credit while delivering appropriate returns and profitability 12/18/2012
Brand Management7 Perceived Value Competitive Advantage Rebellious Premium pricing Outdoorsy Quality Macho/Rugged Reliability with two year Independence warranty Freedom Support to the motorcycling lifestyle Individuality Easy availability of motor Expressing one‟s self parts, merchandise and Adventure on the open road insurance services Experiencing life to its fullest 12/18/2012
Positioning Strategy – Cult Brand8 Cult products are normally priced well above the industry average The Icon – The Idea of Selling not just bikes, but the „Harley Experience‟ Formation of Harley Ownership Group Created an image of lifestyle for biker Multi-generational and multi-cultural marketing strategy U.S. core customer base: Caucasian men over the age of 35 U.S. outreach customers: Women, young adults, African-American adults, and Latino adults Brand Personality: Excitement and Ruggedness Unequivocal Customer Loyalty Dare to be different and celebrate that difference Relatively very small customer base, spreading the good word and spending lots of money 12/18/2012
Customer Interface9 Motorcycle consumer shows, racing activities, music festivals, mixed martial arts activities After-sale services Online catalog and internet orders 12/18/2012
Competition10 Major competitors outside US & also home bike makers in the US Heavyweight motorcycle market – highly competitive Major Competitors: BMW Honda Suzuki Yamaha Polaris Custom bike manufacturers like Orange County Choppers BMW head on rivalry with HD as it looks to lure HD loyalists to its brand Rivalry criteria- performance, styling, breadth of product line, image, reputation, quality of after-sales services, price 12/18/2012
Competitive Market of US motorcycles 11 Harley Davidson‟s market share is 50% in the heavy – motor segment Others, 8.30% Kawasaki, 7.50 % Harley Davidson, 27.60 % Yamaha, 12.50 % Suzuki, 11.20% Honda, 35.60%Source: Data Monitor 2010 12/18/2012
Industry Matrix 13Source: http://bigcharts.com 12/18/2012
Trend of falling financial statistics 14 Harley Davidson‟s market share is 50% in the heavy – motor segmentSource: http://investor.harley-davidson.com/phoenix.zhtml?c=87981&p=irol-demographics 12/18/2012
Challenge # 116 Most “failed” brand extensions don‟t jibe with how consumers understand the core brand or just seem incongruous with a company‟s existing product line Harley Davidson had fallen into the trap of thinking that more products equals more sales The Harley Perfume/ Wine coolers Davidson Shampoo / Cake Shower gel Decorating Kit 12/18/2012
Challenge # 217 Extensively mismanaged by focusing on only one segment of the total motorcycle industry: the heavy cruiser market The market for heavyweight motorcycle as a whole is losing out to smaller capacity fuel efficient vehicles, dual-purpose daily use vehicles and new All Terrain Vehicles (ATVs) High rise in oil prices and heavy-weight vehicles are more oil-consuming 12/18/2012
Challenge # 318 The baby boomer generations is aging and new generation needs to be tapped into Average buying age is 42 years and old 12/18/2012
Challenge # 419 Rivalry Threat: Strategic Alliance between Suzuki and Kawasaki through product diversification Some competitors of Harley Davidson have larger financial and marketing resources - Risk Spreading 12/18/2012
Recommendations20 Redefine the Harley-Davidson brand to attract the younger segment Focus on the top-selling and strategic models in its lineup, supplementing the rest of the market through aftermarket options Expand Harley-Davidson Models to Include Bikes Outside of the Heavy Cruiser Segment under a different brand name Careful Investments and reduce licensing costs Direct the R&D efforts optimizing the oil consuming engines 12/18/2012
Key Takeaways21 Focus on your brand values Don‟t alienate your core customers – avoid brand dilution The more you add, the more you risk undermining your basic differentiating idea, which is the essence of your brand 12/18/2012