English 3345 Business Team 4 Natalie Martell Martha

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

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

– Larger and more powerful motorcycles are built Mid-1950 s – Harley-Davidson became the undisputed leader of the motorcycle market – 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

• Verge of bankruptcy in 1970 • Successfully shed its product and marketing doldrums • 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

…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, tattoocovered, 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 • Competitors coming out with cheaper, sleeker faster bikes

• “Harley's close association with boomers could make the brand harder to sell to younger customers • The stronger the brand is with the older generation, the weaker it is with the younger generation. ” (Nolan & Kotha, 2007).

Proposed Solution • Focus Groups and Market Analysis – Focus groups can give Harley that insights that it needs to improve its motorcycles – Will get a good sense of what the majority wants, a good look at trends, and opinions – Segment the market by age brackets and get information on what each bracket likes and dislikes

Marketing • Harley has positioned itself as a “bikers” motorcycle. • They are alienating a large segment of people who buy motorcycles that do no fit this image. • Needs a new marketing campaign

Evidence of problem: • Shutdown of Buell line • Sale of MV Augusta Brand Harley • Did not Invest time and money into research • Lost 125 million dollars • Top Management and marketing departments not listening to innovations and creativity • Must understand diversity of bike riders

Price • Other brands offer high quality cheaper motorcycles • A drawback to Harley- prices are higher • Need to find a way to make a cheaper bike with high quality • 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.