English 3345 - Business Team #4: Natalie Martell Martha Martinez Virginia Lopez Myles Melendez

O R Y H S I T The birth of the Harley-Davidson legend began in 1903, in a small shed in the Davidson family backyard in Milwaukee.

In 1907, they had one full-time employee and sold 50 motorcycles.

• • 1908 – Standard was raised Walter’s Harley motorcycle – V-twin engine – Transformed itself into the world's leading producer of motorcycles • 1918, Harley-Davidson became the world's largest motorcycle company - 28,000 motorcycles sold

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Larger and more powerful motorcycles are built Mid-1950s

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Harley-Davidson became the undisputed leader of the motorcycle market

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Harley motorcycles were used by the U.S. military, highway patrol officers, the Hell's Angels, and Hollywood rebels, including actors James Dean and Marlon Brando.

Late 1950’s- young "Elvis types" attracting dates with their Harley

• • Teerlink's leadership – company began to transform itself from an informal to a formal organization – Believed that in changing the pay system, the workers would be able to understand empowerment Harley differentiated itself from its Japanese manufacturers – Offering support to various enthusiast and social groups

• • “Hogheads” – Breaking 65 years of tradition – Creating the V-Rod clothing, helmets, boots, jewelry, and pet accessories – “A new generation” Harley-Davidson was accomplishing what it set out to do

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Verge of bankruptcy in 1970

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Successfully shed its product and marketing doldrums

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2003 once again HD became the market leader of the U.S. heavyweight motorcycle industry Celebrating its 100 th birthday

Communication Strategy

• • • 1950’s – – High market share Loyal customer base • Police departments Emergence of new competitors – Honda • Lightweight, fuel efficient motorcycles HD market share decline – Lack of quality

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…cont.

Resurrection – Vaughan Beals, VP of Sales – Willie G. Davidson, grandson of founder Main concern: quality – Drove to rallies to meet with consumers • Learned about complaints, concerns • • Promised change HOGs (Harley Owners Group) – Leaders of movement

…cont.

• • • Image problem – HOG’s • “Pot-smoking, beer-drinking, woman-chasing, tattoo covered, leather-clad bikers.” – Imitators & bootleggers • Tarnishing brand-image with low-quality products HD began licensing their products New customer segment – “Rubbies” (Rich, urban, bikers) – “One in three of today’s Harley-Davidson buyers are professionals or managers. About 60 percent have attended college .”

PROBLEMS HARLEY -DAVIDSON FACES

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Competitors coming out with cheaper, sleeker faster bikes

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The stronger the brand is with the older generation, the weaker it is with the younger generation.” (Nolan & Kotha, 2007).

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Harley's close association with boomers could make the brand harder to sell to younger customers

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Proposed Solution

Focus Groups and Market Analysis

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Focus groups can give Harley that insights that it needs to improve its motorcycles

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Will get a good sense of what the majority wants, a good look at trends, and opinions

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Segment the market by age brackets and get information on what each bracket likes and dislikes

Marketing

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Harley has positioned itself as a “bikers” motorcycle.

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They are alienating a large segment of people who buy motorcycles that do not fit this image.

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Needs a new marketing campaign

Evidence of problem:

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Shutdown of Buell line

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Sale of MV Augusta Brand Harley

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Did not Invest time and money into research

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Lost 125 million dollars

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Top Management and marketing departments not listening to innovations and creativity

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Must understand diversity of bike riders

Price

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Other brands offer high quality cheaper motorcycles

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A drawback to Harley- prices are higher

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Need to find a way to make a cheaper bike with high quality

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Start creating brand loyalty at a younger age.

SWOT Analysis

• Harley Davidson’s history and success has strived, and is growing bigger each decade. • Even though the company needs no help in bringing in revenue, it wouldn’t hurt to gain more attention from the younger audience

Strengths

• Harley Davidson is known by the quality and new developments of their products. • The biggest strength in this company is the name and reputation this company has built and constructed for over 100 years. • Not only provides a product but as well as services that provide financing.

• A Creation of varieties of products from leather boots to Build-your-own-motorcycle. • A complex and vivid internet official site you can read feedbacks and stories from loyal customers.

Weaknesses

• Harley Davidson is struggling in targeting the younger audience. • The median age of an actual Harley Davidson rider ranges from 42 to 49.

• The generations of baby boomers have contributed hugely to the gross sales but once they get older, Harley Davidson is faced with major conflicts in the future. • Baby boomers have already past their midlife crisis phase and big expenditures are past their objectives at this point.

Opportunities

• Harley Davidson has developed an image only related to the baby boomer generation. • Their research and development group need to construct products that can create more attention to the company from the younger audience.

• Their decisions have to be chosen wisely because their sales are dropping as their majority of their audience are getting older.

Threats

• • • • Decrease in demand for their bikes Continuing to be a traditional loyal brand of motorcycles. Choice and selection that this generation has shown is far from the buel look This generation is looking more for slimmer sports like bikes which Harley Davidson doesn’t manufacture.