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Strategy Analysis of Niche Marketer
HARLEY - DAVIDSON
1
Compiled by :-
Binay Prasanna Jena
Roll U109110
PGDM 2009-2011, Section C
1 www.harley-davidson.com
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My First Harley2
Sun raises, and the off comes the coverGrab the helmets, leathers and my lover.
The key is on I give her just a little chokeShe fires right up with very little smoke.
She purrs like a kitten ready to hit the streetMy wife climbs on and I lift my feet.
My Harley is rolling the winds in our hairWere cruising now, it doesnt matter where.
She glides down the road as pretty as can beThe best part is that my wife is with me.
With bugs on our faces we will return homeClean her all up and wipe down the chrome.
We will cover her up with a smile on our face
And look forward to the day she will take us to another place.
JTL2005
Jack T Lindsey
My First Harley biker tries hard to put his nostalgia with the machine through words; which is
just one of the many paeans composed in reminiscence of the association with the two-wheeledmachines, which are lot more beyond than just being inanimate motorcycles.
Adventure, self-expression, freedom few words that are continuously associated with a brand
that in spite of rugged feel promises to deliver on the ultimate motorcycling experience which
drives bikers crazy. The product, more so the brand has been delivering users need to a level more
beyond expectations.
2 http://vtwinbiker.com/BikerPoetry2/My_First_Harley/my_first_harley.html
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IntroductionHarley-Davidson3 (often abbreviated H-D or Harley), the first decade of the 20th century,
Milwaukee, Wisconsin witnessed the foundation of this motorcycle manufacturer. Harley-Davidson
figured among the two major American manufacturers to have survived the Great Depression, a
media-accelerated negative image of motorcyclists, a period of poor quality control, and
competition with Japanese manufacturers it has been this survivor instinct that implicitly inspires
bikers till date.
Heavyweight (over 750 cc) motorcycles designed for cruising on the highway are the product that
Harley-Davidson deals with. Popularly known as "Harleys", they are known to have a distinctive
design and exhaust note and specially noted for the tradition of heavy customization that gave rise
to these chopper-style of motorcycles. Styles of classic Harley designs are still reflected in current
Harley-Davidson motorcycles, except for the modern VRSC model family. H-D's attempts to identify
itself in the light motorcycle market have not been barely successful and have largely been
abandoned since the sale of its Italian subsidiary Aermacchi in 1978. Its sustenance of loyal brand
community is through events, active clubs, a museum, aggressive merchandising & logo licensing.
Almost 5% of the company's net revenue is accounted for by Harley's licenses for logo.
History and backgroundIn 1901, William S. Harley,aged 21, planned for a small engine which could be used in a regular
pedal-bicycle frame, with a displacement of 7.07 cubic inches (116 cc) and four-inch (102 mm)flywheels. Finally by 1903, the plan saw certain concreteness with the help of his childhood friend
Arthur Davidson and his brother Walter Davidson, who labored together in the northside
Milwaukee machine shop of their friend Henry Melk. However this power-cycle couldnt conquer
modest hills of Milwaukee without pedal assistance. Will Harley and the Davidsons quickly wrote
off their first motor-bicycle as a valuable learning experiment.
They started off on a new and improved second-generation machine. This first "real" Harley-
Davidson motorcycle had a bigger engine of 24.74 cubic inches (405 cc) with 9.75 inches (25 cm)
flywheels weighing 28 lb (13 kg). The machine's advanced loop-frame pattern was similar to the
1903 Milwaukee Merkel motorcycle (designed by Joseph Merkel, later of Flying Merkel fame). The
bigger engine and loop-frame design took it out of the motorized-bicycle category and would help
define what a modern motorcycle should contain in the years to come. The prototype of the new
loop-frame Harley-Davidson was assembled in a 10- by 15-foot (3 by 5 meter) shed in the Davidson
family backyard. Most of the major parts, however, were made elsewhere, including some
3 http://en.wikipedia.org/wiki/Harley-Davidson
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probably fabricated at the West Milwaukee rail shops where oldest brother William A. Davidson
was then tool room foreman. This prototype machine was functional by 8 September 1904 when it
competed in a Milwaukee motorcycle race held at State Fair Park, ridden by Edward Hildebrand
and placed fourth. It was the first documented appearance of a Harley-Davidson motorcycle in the
historical record.
Fig 1. 1907 model
In January 1905, advertisements were placed in the "Automobile and Cycle Trade Journal" that
offered bare Harley-Davidson engines to the do-it-yourself trade. By April, complete motorcycles
were in production on a very limited basis, it sold three bikes that year. In 1907, William S. Harley
graduated from the University of WisconsinMadison with a degree in mechanical engineering &
production of motorcycles increased to 150 motorcycles that year, with the company being
officially incorporated in September 1907. They began selling motorcycles to police department,market which has been important to them since then. It gradually progressed from single cylinder
engine (26.84 cubic inches/439.8 cc) model in 1905 and 1906 to 45-degree V-Twin engine (53.68
cubic inches/879.7 cc)in 1907 being displayed in Chicago Automobile show. Top speed was about
60 mph (97 km/h). Production jumped from 450 motorcycles in 1908 to 1,149 machines in 1909. In
1917, the United States entered World War I and the military demanded motorcycles for the war
effort. Harley-Davidson provided about 15,000 machines to the military forces during World War I.
In the late summer of 1929, Harley-Davidson introduced its 45 cubic inch flathead V-Twin to
compete with the Indian 101 Scout4 and the Excelsior Super X5.This model was known as the "three
cylinder Harley" because the generator was upright and parallel to the front cylinder. The 2.745 in
(69.7 mm) bore and 3.8125 in (96.8 mm) stroke continued in most versions of the 750 engine;exceptions include the XA and the XR750.
4 http://en.wikipedia.org/wiki/Indian_101_Scout5 http://en.wikipedia.org/wiki/Excelsior_Super_X
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Few months after the introduction of their 45 cubic inch model, Great Depression crept in. Sales
plummeted from 21,000 in 1929 to 3,703 in 1933. In spite those dismal numbers; Harley-Davidson
proudly unveiled its lineup for 1934, which included a Flathead with art deco styling. Survival for
rest of Depression probed the company to manufacture industrial power plants based on their
motorcycle engines in this period. They also designed and built a three-wheeled delivery vehicle
called the Servi-Car, which remained in production until 1973.In the mid-'30s, Alfred Rich Child
opened a production line in Japan with the 74ci VL. The Japanese license-holder severed its
business relations with Harley-Davidson in 1936 and continued manufacturing the VL under the
Rikuo name. An 80 cubic inch flathead engine was added to the line in 1935, by which time the
single-cylinder motorcycles had been discontinued. In 1936, the 61E and 61EL models with the
"Knucklehead" OHV engines was introduced. By 1937, all Harley-Davidson's flathead engines were
equipped with dry-sump oil recirculation systems similar to the one introduced in the
"Knucklehead" OHV engine. The revised 74 cubic inch V and VL models were renamed U and UL,
the 80 cubic inch VH and VLH to be renamed UH and ULH, and the 45 cubic inch R to be renamed
W. In 1941, the 74 cubic inch "Knucklehead" was introduced as the F and the FL. The 80 cubic inch
flathead UH and ULH models were discontinued after 1941, while the 74" U & UL flathead models
were produced up to 1948.
Harley-Davidson at Nations service in World War II6
Harley-Davidson (being one of only two American cycle manufacturers to have survived the Great
Depression) produced large numbers of motorcycles for the US Army in World War II and resumed
civilian production afterwards, producing a range of large V-twin motorcycles that were successful
both on racetracks and for private buyers. Harley-Davidson, on the eve of World War II, was
already supplying the Army with a military-specific version of its 45" WL line, called the WLA (The A
in this case stood for "Army").
6 http://en.wikipedia.org/wiki/Harley-Davidson
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Fig2. Image of WLA from US Army Manual (WW II) Fig3. WLC produced for Canada
military
Upon the outbreak of war, the company, along with most other manufacturing enterprises, shifted
to war work. Over 90,000 military motorcycles, mostly WLAs and WLCs (the Canadian version)
would be produced, many to be provided to allies. Harley-Davidson received two Army-Navy E
Awards, one in 1943 and the other in 1945, which were awarded for Excellence in Production. The
U.S. Army also asked Harley-Davidson to produce a new motorcycle with many of the features of
BMW's side-valve and shaft-driven R71. Harley largely copied the BMW engine and drive train and
produced the shaft-driven 750 cc 1942 Harley-Davidson XA. Only 1,000 were made and the XA
never went into full production. It remains the only shaft-driven Harley-Davidson ever made.
Fig 4. Harley copied the BMW R71 to produce the XA model
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Reputation tarnishing
In 1952, Harley-Davidson was charged with restrictive practices following their application to the
US Tariff Commission for a 40% tax on imported motorcycles. Hollywood too brought disrepute to
Harley's image with many outlaw biker gang films produced from the 1950s through the 1970s,
following the Hollister riot on July 4, 1947. "Harley-Davidson" for a long time became synonymous
with the Hells Angels7and other outlaw motorcyclists8. In 1969, American Machinery and Foundry(AMF) bought the company, streamlined production, and slashed the workforce. This action
resulted in a lower quality of bikes and a labor strike. The bikes were expensive and inferior in
performance, in handling and in quality compared to Japanese motorcycles. Sales declined, quality
plummeted, and the company almost went bankrupt. The "Harley-Davidson" name was mocked as
"Hardly Ableson", "Hardly Driveable," and "Hogly Ferguson", and the nickname "Hog" became
pejorative. In 1977, Harley-Davidson produced what has become one of its most controversial
models, the Confederate Edition. The bike was essentially a stock Harley with Confederate-specific
paint and details.
Restructuring and revival
In 1981, the company was sold by AMF to a group of thirteen investors led by Vaughn Beals and
Willie G. Davidson for $80 million. As part of increasing operational efficiency inventory was strictly
controlled using the just-in-time system. During early eighties, Harley-Davidson claimed that
Japanese manufacturers were importing motorcycles into the US in volumes as to harm or
threaten to harm domestic producers. Post enquiry into the same by the US International Trade
Commission, President Reagan imposed in 1983 a 45% tariff on imported bikes and bikes over 700
cc engine capacity. Harley Davidson subsequently rejected offers of assistance from Japanese 9
motorcycle makers. Instead of trying to match the Japanese, the new management deliberately
exploited the "retro" appeal of the machines, building motorcycles that intentionally adopted the
look and feel of their earlier machines and the subsequent customizations of owners of that era.
Components like brakes, forks, shocks, carburetors, electrics and wheels were outsourced from
foreign manufacturers and quality slowly increased, technical improvements were made, and
buyers gradually returned. To remain profitable Harley continues to increase the amount of
overseas-made parts it uses, while being careful not to harm its valuable "American Made" image.
By 1990, Harley once again became the sales leader in the heavyweight (over 750 cc) market, with
the introduction of the "Fat Boy". With this introduction a story rapidly spread that its silver paint
job and other features were inspired by the World War II American B-29 bomber; and that the Fat
Boy name was a combination of the names of the atom bombs (Fat Man and Little Boy) that were
7 http://en.wikipedia.org/wiki/Hells_Angels8 http://en.wikipedia.org/wiki/Outlaw_motorcycle_gang#Outlaw_Motorcycle_Gangs9 http://www.japanlaw.info/lawletter/july83/ase.htm
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dropped on Nagasaki and Hiroshima respectively. However, the Urban Legend Reference 10Pages
lists this story as an urban legend1112.
Harley-Davidson continued to reinvent itself through association with sport bike manufacturer
Buell Motorcycle Company13 in 1987 when they supplied Buell with fifty surplus XR1000 engines.
Buell continued to buy engines from Harley-Davidson until 1993, when Harley-Davidson boughtforty-nine percent of the Buell Motorcycle Company. H-D increased its share in Buell to ninety-
eight percent in 1998, and further to complete ownership in 2003 14. In an attempt to attract
newcomers to motorcycling in general and to Harley-Davidson in particular, Buell developed a low-
cost, low-maintenance motorcycle. The resulting single-cylinder Buell Blast was introduced in
2000, and was made through 2009, which, according to Buell, is to be the final year of production.
In 2000, Ford Motor Company added a Harley-Davidson edition to the Ford F-Series F-150 line,
complete with the Harley-Davidson logo. This truck was a Super Cab for model year 2000. In 2001,
Ford changed the truck to a Super Crew and in 2002 added a super-charged engine (5.4 L) which
continued until 2003. In 2004, the Ford/Harley was changed to a Super-Duty, which continues
through 2009. Ford again produced a Harley-Davidson Edition F-150 for their 2006 model-year, as
well.
Evolution of the super machines
Big V-twins
F-head, also known as JD, pocket valve and IOE (intake over exhaust), 19141929 (1000 cc), and 19221929
(1200 cc)
Flathead, 19301948 (1200 cc) and 19351941 (1300 cc).
Knucklehead, 19361947 61 cubic inch (1000 cc), and 19411947 74 cubic inch (1200 cc)
Panhead, 1941952 61 cubic inch (1000 cc), and 19481965, 74 cubic inch (1200 cc)
Shovelhead, 19661984, 74 cubic inch (1200 cc) and 82 cubic inch (1345 cc) since late 1978
Evolution (aka "Evo" and "Blockhead"), 19842000, 80 cubic inch (1340 cc)
Twin Cam 88 (aka "Fathead") 19992006, 88 cubic inch (1450 cc)
Twin Cam 88B (counter balanced version of the Twin Cam 88) 20002006, 88 cubic inch (1450 cc)
Twin Cam 96, since 2007, 96 cubic inch (1584 cc)
10 http://en.wikipedia.org/wiki/Snopes11 http://www.snopes.com/business/market/fatboy.asp12 http://www.independent.co.uk/life-style/motoring/road-tests/road-test-harleydavidson-flstf-fat-boy-
424174.html13 http://www.industrytoday.com/article_view.asp?ArticleID=148514 http://www.motorcycle.com/manufacturer/buell/buell-blast-13968.html
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Twin Cam 103, 20032006, 2009, 103 cubic inch (1690 cc) (engines for C.V.O. models)
Twin Cam 110, since 2007, 110 cubic inch (1802 cc) (engines for C.V.O. models)
Small V-twins
D Model, 19291931, 750 cc
R Model, 19321936, 750 cc
W Model, 19371952, 750 cc, solo (2 wheel, frame only)
G (Servi-Car) Model, 19321973, 750 cc
K Model, 19521953, 750 cc
KH Model, 19541956, 900 cc
Ironhead, 19571971, 900 cc; 19711985, 1000 cc
Evolution, since 1986, 883 cc, 1100 cc and 1200 cc
Model Families
Modern Harley-Davidson branded motorcycles are categorized into one of five model families:
Touring, Softail, Dyna, Sportster and VRSC. These model families are distinguished by the frame,
engine, suspension, and other characteristics.
Touring15
Fig 5. Electra Glide at service of Hamburg Police
The touring family, also known as "dressers", includes three Road King models and Electra Glide
models offered in various trim. The Road Kings have a "retro cruiser" appearance and are equipped
with a large clear windshield. Road Kings are reminiscent of big-twin models from the 1940s and
'50s. Electra Glides can be identified by their full front fairings. Most Electra Glides sport a fork-
mounted fairing referred to as the "Batwing" due to its unmistakable shape. The Road Glide has aframe-mounted fairing, referred to as the "Sharknose". The Sharknose includes a unique, dual
front headlight. Touring models are distinguishable by their large saddlebags, rear coil-over air
suspension and are the only models to offer full fairings with Radios/CBs. Touring models used the
15 http://en.wikipedia.org/wiki/Harley-Davidson
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same frame (which got introduced with a Shovelhead motor in 1980) with modest upgrades till
2009, when it went for extensive redesign. The frame is distinguished by the location of the
steering head in front of the forks and was the first H-D frame to rubber mount the drive train to
isolate the rider from the vibration of the big V-twin. Touring models have become favorites with
several local and state police agencies, such as the Chicago Police Department, the Los Angeles
Police Department, the Iowa State Patrol, and several others.
Softail16
Fig 6. Softail heritage classic (2002)
These big-twin motorcycles reflect Harley's strong value on tradition. With the rear-wheel
suspension hidden under the transmission, they are visually similar to the "hardtail" choppers
popular in the 1960s and 1970s, as well as from their own earlier history. In keeping with that
tradition, Harley offers Softail models with "Springer" front ends and "Heritage" styling that
incorporate design cues from throughout their history.
Dyna17
Fig 7. Dyna Super Glide Custom (2005)
Dyna motorcycles feature big-twin engines and traditional styling. They can be distinguished from
the Softail by the traditional coil-over suspension that connects the swingarm to the frame, and
from the Sportster by their larger engines. On these models, the transmission also houses the
engine's oil reservoir. Latest additions to Harley-Davidsons line-up of Dyna models: 2006 - Super
Glide, Super Glide Custom, Street Bob, Low Rider, and Wide Glide; 2008 -Fat Bob.
16 http://en.wikipedia.org/wiki/Harley-Davidson
17 http://en.wikipedia.org/wiki/Harley-Davidson
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Sportster18
Fig 8. Sportster 883 Custom (2002) Fig 9. H-D XL 1200 Custom Anniversary edition
(2003)
Introduced in 1957, the Sportster is the longest-running model family in the Harley-Davidson
lineup. Initially conceived as racing motorcycles, they were popular on dirt and flat-track race
courses through the 1960s and 1970s. Smaller and lighter than the other Harley models,
contemporary Sportsters make use of 883 cc or 1200 cc Evolution engines although often
modified, they remain similar in appearance to their racing ancestors.2007 marked the 50th
anniversary of the Sportster and Harley-Davidson produced a limited edition called the XL50, of
which only 2000 were made for sale worldwide.
VRSC19
Fig 10. Harley Davidson V-Rod
Latest addition to Harley family, introduced in 2001, the VRSC family bears little resemblance to
Harley's more traditional lineup. Competing against Japanese and American muscle bikes and
seeking to expand its market appeal, the "V-Rod" makes use of an engine developed jointly with
Porsche that, for the first time in Harley history, incorporates overhead cams, and liquid cooling.The V-Rod is visually distinctive, easily identified by the 60-degree V-Twin engine, the radiator and
18 http://en.wikipedia.org/wiki/Harley-Davidson
19 http://en.wikipedia.org/wiki/Harley-Davidson
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Harley-Davidson has also purchased most of Castalloy, which is a South Australian producer of cast
motorcycle wheels and hubs. The South Australian government has set forth "protection to the
purchaser (Harley-Davidson) against environmental risks22."
Harley-Davidson Riders Club of Great Britain - The Harley-Davidson Riders Club of Great Britain (est
1949)23
was the first British riders club (as opposed to motorcycle club) and organized nationalrallies and ride-outs from the outset. The 1982 rally began a popular run of events, probably due to
the good fortune of having William G. Davidson attending his first rally outside the U.S., in Great
Britain. He is thought to have been more than curious to discover how the secret "Evolution
Motor" had found its world exclusive on the cover of the spring edition of the HDRCGB magazine,
the "Harleyquin", but having a forgiving nature, Willie G. returned in 1984, along with Vaughn
Beals and Len Thomson to officially show off the Evolution engine by bringing a test ride fleet to
the second Brighton International Super Rally run by H.D.R.C.G.B. 24. The demonstration rides were
the first at any European Rally. The club now has circa 1800 members throughput the U. K. U.S.A.
and Europe not forgetting their founder member in Australia. The club is split into regions and
most hold rallies during the summer culminating in the clubs International Rally25
.
Hall of fame
Because William S. Harley, Arthur Davidson, William A. Davidson and Walter Davidson both used
and believed in its products and relied on the dedication of its employees to produce quality
motorcycles, the four men were inducted into the Labor Hall of Fame26.
Worldwide Market Share Snapshot27
22 http://www.minterellison.com/public/connect/Internet/Home/Expertise/Track+Records/TR-Harley-
Davidson23 http://www.hdrcgb.org.uk/24 http://www.hdrcgb.org.uk/25 http://www.harley-davidson-hangout.com/pages/oz2008/index.htm26 http://www.dol.gov/oasam/programs/laborhall/2004_davidson.htm27 http://www.authorstream.com/presentation/clonfunky-113973-harley-davidson-education-ppt-
powerpoint/
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P r i c i n g H a r l e y sAlthough Harley-Davidson uses many of the same parts suppliers as Honda, Kawasaki and Yamaha,
former has been pricing well above the competitive price of these competitors. Harley's high prices
combined with its customer loyalty and mystique help overcome buyer resistance to higher prices.
Production efficiencies over the last two decades, however, have made quality among motorcycleproducers about equal, but pricing above the market signals quality to buyers; whether or not they
get the quality premium they pay for28.The competitive strategy used by Harley Davidsona highly
differentiated range of products combined with a build-to-order manufacturing capability
enabled them to survive intense Japanese competition29.
Prices of few Harley models in 2009 have been specified as below -
Harley-Davidson Models Prices
2009 Harley-Davidson Sportster 1200 Nightster $9,899.00
2009 Harley-Davidson Road King Classic $17,999.00
28 http://www.enotes.com/management-encyclopedia/pricing-policy-strategy29 http://www.cox.smu.edu/article/research/research.do/89H
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2009 Harley-Davidson Electra Glide Ultra Classic $20,999.00
2009 Harley-Davidson Road Glide Base $18,599.00
2009 Harley-Davidson VRSC Night Rod Special $16,699.00
2009 Harley-Davidson Softail Night Train $15,899.00
2009 Harley-Davidson VRSC V-Rod $14,999.00
2009 Harley-Davidson Street Glide Base $18,999.00
2009 Harley-Davidson Dyna Glide CVO Fat Bob $25,299.00
2009 Harley-Davidson VRSC V-Rod Muscle $17,199.00
2009 Harley-Davidson Sportster Iron 883 $7,899.00
2009 Harley-Davidson Softail Rocker C $19,499.00
2009 Harley-Davidson Dyna Glide Low Rider $15,099.00
2009 Harley-Davidson Softail Cross Bones $16,999.00
2009 Harley-Davidson Softail Deluxe $17,449.00
2009 Harley-Davidson Dyna Glide Super Glide $11,999.00
2009 Harley-Davidson Softail Fat Boy $15,999.00
2009 Harley-Davidson Softail Heritage Softail Classic $17,999.002009 Harley-Davidson Dyna Glide Super Glide Custom $12,999.00
2009 Harley-Davidson Sportster XR1200 $10,799.00
Price Comparison across Competitors in similar product category30
2004 Harley-Davidson 883
Sportster Custom 2004 Honda Shadow Aero 750 2004 Kawasaki 800 Vulcan Class
Suggested base price: $7595-
$8090 Suggested base price: $6199 Suggested base price: $6799
Wet weight: 625 lb Wet weight: 577 lb Wet weight: 575 lbSeat height: 28.1 in. Seat height: 25.9 in. Seat height: 27.8 in.
ENGINE ENGINE ENGINE
Type: Air-cooled 4-valve V-twin
Type: Liquid-cooled SOHC 6-valve
V-twin
Type: Liquid-cooled SOHC 8-valve
V-twin
Displacement: 883cc Displacement: 745cc Displacement: 805cc
Carburetion: 1, 40mm Carburetion: 1, 34mm Carburetion: 1, 36mm
Transmission: Five-speed Transmission: Five-speed Transmission: Five-speed
Final drive: Belt Final drive: Shaft Final drive: Chain
CHASSIS CHASSIS CHASSIS
Front wheel: Wire-spoke, 19 x
2.15 in.
Front wheel: Wire-spoke, 17 x 3.0
in.
Front wheel: Wire-spoke, 16 x 3.0
in.
Rear wheel: Cast, 16 x 3.0 inches Rear wheel: Wire-spoke, 15 x 3.5 Rear wheel: Wire-spoke, 16 x 3.0
30 http://www.motorcyclecruiser.com/roadtests/budget_v_twin_bike_comparison/index.html
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in. inches
Front brake: Two-piston caliper,
11.5-in. disc
Front brake: Two-piston caliper,
11.7-in. disc
Front brake: Two-piston caliper,
11.8-in. disc
Rear brake: Single-piston caliper,
11.5-in. disc Rear brake: Drum Rear brake: Drum
Front suspension: 39mm
stanchions, 6.1 in. travel
Front suspension: 41mm
stanchions, 4.6 in. travel
Front suspension: 41mm
stanchions, 5.9 in. travel
Rear suspension: Dual dampers,
3.3 in. travel
Rear suspension: Dual dampers,
3.5 in. travel
Rear suspension: Single damper,
in. travel
Fuel capacity: 4.5 gal. Fuel capacity: 3.7 gal. Fuel capacity: 4.0 gal.
PERFORMANCE PERFORMANCE PERFORMANCE
Fuel mileage: 51.4 mpg Fuel mileage: 42.8 mpg Fuel mileage: 48.1 mpg
Average range: 231 miles Average range: 158 miles
Average range: 192 mi.
Harley Davidson SWOT analysis31
Strengths
HOG has 430, 000 members worldwide
Allows owners to customize their bikes
Strong relationship with suppliers and
dealers
Only major US motorcycle manufacturer
Weaknesses
Facing ongoing capacity constraints
Lack of opportunity for advancement
Leadership strategy council is
comprised entirely of vice-presidents
Lack of employee diversity
31 http://www.authorstream.com/presentation/clonfunky-113973-harley-davidson-education-ppt-
powerpoint/
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Opportunities
International Heavy weight market
Women and young riders
Market share in Europe and Asia
Demand in US Market for bikes
Supplies many American police forces
Threats
Average buying age is 42 years and
more
Shift in buyers tastes and needs
Government policies and environment
protection/emission norms
H a r l e y - D a v i d s on B r a n d i n gMission statement of Harley-Davidson reads as We fulfill dreams through the experience of
motorcycling, by providing to motorcyclists and to the general public an expanding line of
motorcycles and branded products and services in selected market segments.32
Keys to Harley Davidson being perceived as a strong brand are the intensity of emotions and the
imagery that Harleys evoke. These are some of the responses33
Harley-Davidson as a word, what images do you visualize? The quintessential motorcycle
and some cool dudes.
Harley-Davidson, what do you hear? VroomVroom
Harley-Davidson, what do you smell? A mixture of burning gasoline and oil and leather.
Harley-Davidson, what do you feel? Depending on perspective variety of emotions is on
display
If you are not a motorcyclist, you might feel fear, disgust and curiosity
If you are a motorcyclist and you own a Harley, you might feel pride.
If you are a motorcyclist and you do not own a Harley, you might feel respect or envy.
32 http://www.harley-davidson.com/wcm/Content/Pages/Student_Center/student_center.jsp?
locale=en_US#missionstatement33 http://georgetorok.blogspot.com/2007/03/brand-harley-davidson.html
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34Branding is about tugging at your senses. Branding is about evoking emotion. Branding is about
building emotional wants that triumph over petty logic. Branding is about wants. Branding is about
making you doing illogical things. Harley Davidson is a powerful brand because it grabs the senses
and evokes strong emotions. That is what a strong brand does. It had nothing to do with the logo,
fonts and pantone colors. Yet that is what many advertising agencies and marketing minions waste
their time on. No other motorcycle evokes the emotion that Harley Davidson does. That is the
power of branding. No one needs a Harley Davidson motorcycle but many want it.
Branding strategy of Harley Davidson is mainly attributed to its product uniqueness
customerization expression of soul35, and as Harley-Davidson promotes Its all about
experience36.
Its strategy has been channelized through following :
Merchandising37
Merchandising consists of apparels and accessories38
. Apart from genuine motoraccessories39 and model racing parts40, Harley-Davidsons merchandising exercise consists
of Motorclothes merchandise riding gear 41 comprising of jackets, customized helmets,
shades, gloves, body armor, hydration vests, custom boots, etc as well as home
collectibles42which range from glasses, mugs, bottle openers, travel clocks, picture frames,
shot glasses, travel mugs, skull clocks, coaster sets, die-cast collectibles, cds, H.O.G. banks,
etc. With changing times and technology creeping in, Harley-Davidson has diverged its
branding exercise to include phone cases, headsets as well as phone accessories43.
Cult Branding44
34 http://georgetorok.blogspot.com/2007/03/brand-harley-davidson.html35 http://www.harley-
davidson.com/wcm/Content/Pages/Genuine_Motor_Accessories/Customize_your_harley.jsp?locale=en_US36 http://www.harley-davidson.com/wcm/Content/Pages/Experience/experience.jsp?locale=en_US37 http://www.harley-davidson.com38 http://www.harley-
davidson.com/wcm/Content/Pages/Accessories_and_Apparel/Accessories_and_Apparel.jsp?locale=en_US39 http://www.harley-
davidson.com/wcm/Content/Pages/Genuine_Motor_Accessories/GMA_2010_Catalog.jsp?locale=en_US40 http://www.harley-davidson.com/en_US/Media/downloads/Racing/US_SE10_Full.pdf41 http://s7ondemand1.scene7.com/s7ondemand/brochure/flash_brochure.jsp?
company=HarleyDavidson&sku=Core+Catalog+2009&windowtitle=Harley-
Davidson&el=large&locale=en_US&bmLocale=en_US42 http://www.harley-davidson.com/browse/browse_products.jsp?FOLDER%3C
%3Efolder_id=2534374309077748&PRODUCT%3C
%3Eprd_id=845524448771292&bmUID=1191877161643&bmLocale=en_US&locale=en_US&bmLocale=en_U
S43 http://www.fonegear.com/harley-davidson/44 http://www.cult-branding.com/cbprofiles/harley-davidson-cult-brand-profile.html
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H.O.G. Harley Owners Group45
Harley-Davidson lends its owners a sense of community feel and binds them together with
a HOG membership (established in 1983) which is linked through the dealers. They didnt
just stop at creating member groups rather started sponsoring rallies. Not only did this
solidify its communities, rather it was used as a killer sales tool. They brought motorcyclesfor people to try out. This concept reaches its apex each year at Bike Week in Daytona
Beach and the Sturgis Rally and Races in South Dakota. Collectively, the events attract over
half a million Harley enthusiasts. Harley takes feedback its employees receive at these
events very seriously. Opinions they receive from customers affect what is produced in
product lines and the way they run their rallies. HOG has its chapters across nations which
is an organized way to share their passion and show their pride. Many HOG chapters
support local charities. The chapter based in Bridgwater, England, runs an annual charity
fund raising event called Hoggin' The Bridge, which involves around 3,000 bikes crossing
the Severn Bridge from England to Wales. In 2008, proceeds from Hoggin' The Bridge were
donated to a local motorcycle medical courier charity Freewheelers EVS46
.
Licenses47
Harley-Davidson works with 100 licensees ranging in product categories from childrens
(Haddad) to footwear (Wolverine), pet supplies (Coastal Pet), bicycles (Toys R Us),
childrens ride-ons (Fisher-Price), knives (United Cutlery), and lighters (Zippo). To add to
this T-shirt and other accessory licensees, stationery and gifts (Hallmark) as well as logo
licensing constitute a significant feature of branding as well as revenue generation
exercise.
To cite an instance, licensing of the Harley-Davidson logo accounts for almost 5% of thecompany's net revenue48.
Museum49
106 years of Harley-Davidsons history has been aptly reflected in its museums which are a
home to thousands of artifacts and other related memorabilia attracts around 300,000
visitors annually. The museum prides on company's story and history, such as
photographs, posters, advertisements, clothes, trophies, video footage of vintage and
contemporary motorcycling, and interactive exhibits, including 10 motorcycles that visitors
45 http://www.h-o-g.org/hogmember.asp46 http://news.bbc.co.uk/2/hi/uk_news/england/gloucestershire/7678727.stm47 http://www.licensemag.com/licensemag/data/articlestandard//licensemag/332005/174785/article.pdf48 http://en.wikipedia.org/wiki/Harley-Davidson49 http://www.bizzia.com/brandcurve/harley-davidson-brand-becomes-a-museum/
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can sit on50. From birthday bashes to business meetings the museum also plays host to
multiple events51 as part of its brand building as well as social responsibility exercise.
Online Communities52
Dedicated Harley-Davidson V-Rod communities have been promoted along with dealers to
increase motorcyclist awareness, sharing of expectations as well as experience discussion.
This gives the company and its dealers a feel of consumers want and expectation level.
Harley-Davidsons interactive website www.harley-davidson.com provides a great avenue
for the expressive internet user to find a leeway of his freedom through this motorcycle.
Unbound Branding53
In its efforts to stay close to its customers Harley-Davidson collaborated with mobile
agency Snap Tell to run mobile marketing campaigns on similar lines as mens lifestyle
magazines, in which consumers could download various wallpapers for their mobile
phones that featured swimsuit model Marisa Miller posing on the motorcycle.
Harley uses its strong dealership channels to promote strong campaigns through cafes
which provide the consumer almost owned motorcycling experience.
Having said all that its not the channel rather approach to reach out to its consumers, enthusiasts
and fan club, that has helped maintain its brand loyalty as well as increase its consumer base.
Harley-Davidson continues to evolve towards personalizing the motorcycle. It is evident as the
consumers are allowed to customize bikes according to their needs; Harley-Davidson outsources
the parts while concentrating its expertise on engine specifications that contribute towards the
biking experience. Apart from this the company through its merchandising and other exercises
tries to build a community feel around its product. Officially recognizing H.O.G. chapters that are
spread across geographies, while simultaneously encouraging online discussion forums as well
striving towards making its website more and more user interactive are some of the
concentrated efforts towards making Harley-Davidson a personalized product for its end-users.
Merchandising efforts are well as revenues from the licensees provide evidence regarding the
companys acceptance and contribution to the cult. Harley has never effected any cut down in its
prices, rather continues to charge a premium in all its product lines, which create a perception
among bikers that this product is something different and they should expect value for the
premium that they pay which has been met to perfection by the superior bike technology.
50 http://en.wikipedia.org/wiki/Harley-Davidson_Museum51 http://www.harley-davidson.com/wcm/Content/Pages/HD_Museum/events/overview.jsp?locale=en_US52 www.1130cc.com53 http://maverix.typepad.com/brandingunbound/2009/04/how-harleydavidson-uses-mobile-marketing-to-
rev-up-enthusiasts.html
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Entry to Indian marketIndia is the worlds second largest motorcycle market behind China, but the market is dominated
by smaller, inexpensive bikes used primarily for transportation54. However the doors to outdoor
leisure motorcycle riding has been attributed to Indias rapidly growing economy, Indias rising
middle class and significant investment in construction of new highways. This is where Harley-
Davidson sees the opportunity to enter Indian markets.
Harley-Davidson fulfills dreams for people around the world through life-changing products and
experiences. The Harley-Davidson brand represents self-expression, adventure, the freedom of the
open road, and belonging to a global community a family of riders. We know the relevance of the
Harley-Davidson brand rings true in India just as it does in other markets around the world.55
Considering that Harley-Davidson caters to a market segment that looks upon a motorcycle not
just to quench its transportation needs, that has been ably catered to with the current motorcycles
of 100-200 cc engines, rather redefining the motorcycling experience freedom, adventure, self-
expression, passion for motorcycling and above all a sense of pride of belonging to a global
community of passionate bikers.
ConclusionHarley-Davidson has been effectively actualizing consumers perception of adventure, macho
image, handlebars, denim, tattoos and self-expression. All branding exercises, be it the product or
ancillary merchandise and motor parts all are oriented towards further enhancing the feeling of
self-expression and freedom. No wonder Harley-Davidson has been wise enough to foresee the
personalization and customerization needs of consumers ahead of its competitors and rightly so it
has been encashing its foresight.
Until you've been on a Harley-Davidson, you haven't been on a motorcycle56
54 Dilip Chenoy, director general of Society of Indian Automobile Manufacturers (http://www.harley-
davidson.com/wcm/Content/Pages/HD_News/Company/newsarticle.jsp?
locale=en_US&articleLink=News/0525_press_release.hdnews&newsYear=2009&history=news)55 Harley-Davidson Motor Company President and Chief Operating Officer, Matthew Levatich, at the Society
of Indian Automobile Manufacturers annual convention on August 28 (http://www.harley-
davidson.com/wcm/Content/Pages/HD_News/Company/newsarticle.jsp?
locale=en_US&articleLink=News/0525_press_release.hdnews&newsYear=2009&history=news)56 http://answers.yahoo.com/question/index?qid=20070926160256AAEgerQ