I. Statement of the Problem Although Harley Davidson dominates the market in North America, it has been the smallest in Europe and the 4th in Asia/Pacific region which is dominated by Japanese brands. One reason for Harley’s smaller market share in Europe and Asia region is that the company cannot produce enough motorcycles to meet demand and its prices tend to be higher than competitive models. Shortages of Harleys lead many consumers to purchase competitive bikes as there are 2-year waiting lists for some Harley models. The researcher of this study seeks to answer the following questions: 1.
What is the best way to advertise or market Harleys in the Europe and Asia/Pacific region? 2. What improvements shall be done in Harley-davidson. com website? II. Objectives of the Study This study seeks the following objectives: – to be able to understand the market share of Harley Davidson from the case study – to determine which advertising is best for Harley Davidson in Europe and Asia – to know whether the official website of Harley is good enough and competitive enough – to give the best solution to increase market share and sales of Harley in Europe and Asia/Pacific region III. Scopes and Limitations of the StudyOrder now
The study includes the current situation of Harley Davidson Company, the nature of the company, the background, its market share in different countries and the effect of its official website on consumer behavior. The study however, is limited with only secondary data available from the text and from the official websites of Harley and its competing brands. This study has recommendations and points of view that are based from my own perspectives and thinking as a marketing student. IV. Nature of The Research A. Harley Davidson Harley-Davidson, often abbreviated H-D or Harley, is an American motorcycle manufacturer.
Founded in Milwaukee, Wisconsin, during the first decade of the 20th century, it was one of two major American motorcycle manufacturers to survive the Great Depression. Harley-Davidson also survived a period of poor quality control and competition from Japanese manufacturers. The company sells heavyweight (over 750 cc) motorcycles designed for cruising on the highway. Harley-Davidson motorcycles (popularly known as “Harleys”) have a distinctive design and exhaust note. They are especially noted for the tradition of heavy customization that gave rise to the chopper-style of motorcycle.
Except for the modern VRSC model family, current Harley-Davidson motorcycles reflect the styles of classic Harley designs. Harley-Davidson’s attempts to establish itself in the light motorcycle market have met with limited success and have largely been abandoned since the 1978 sale of its Italian Aermacchi subsidiary. Harley-Davidson sustains a loyal brand community which keeps active through clubs, events, and a museum. Licensing of the Harley-Davidson logo accounts for almost 5% of the company’s net revenue. B. Global Competitors Honda motorcycles, Kawasaki, Suzuki and Yamaha are some of the major competitors of Harley Davidson.
C. Motorcycle Buyers The demographic profile of motorcycle buyers has changed over the years. According to the Motorcycle Industry Council, 61% of buyers are over 35 years old whereas in 1980, only 27% has reached this age. In 1980, only 2. 4% of motorcycle buyers had incomes of $50,000 or higher, whereas in 1998, over one third were in this income group. White-collar professionals are the largest group of new bike riders, accounting for 36%. Many are former riders now stepping up to their dream machines and state that motorcycle riding helps reduce stress in their lives. D. Motorcycle Company Websites
H. D. management believes that the Internet is a powerful marketing tool. Its website is affectionately called the “anti-websites” since it encourages visitors to get offline and onto their Harleys. The website includes detailed information on the company and its products. It has nearly 1. 5 million visitors in 1997 alone. V. Areas of Consideration A. Competition All of Harley’s major competitors have products other than motorcycles on their websites including cars (Honda, Suzuki, and BMW), outboard motors (Honda, Yamaha, and Suzuki), and jet skis, snow mobile, boats, generators and power equipments.
However, Harley’s website is devoted exclusively to motorcycle-related information about its products, experience and the company itself, including financial data. This may be a competitive advantage for Harley because it illustrates that the company is focused only in the motorcycle industry. B. Market Share The following table shows the market share of Harley and its global competitors in different regions: |COMPANY |NORTH AMERICA |EUROPE |ASIA/PACIFIC | |BMW |2. 70% |13. 0% |4. 30% | |HARLEY |48. 50% |6. 4 |15. 6 | |HONDA |20. 5 |24. 1 |28 | |KAWASAKI |10. 2 |10. 7 |22. 1 | |SUZUKI |10. 3 |17. 2 |7. 9 | |YAMAHA |4. 8 |16. 3 |16. 6 | |OTHERS |3 |11. |5. 5 | VI. Alternative Courses of Action/Recommendation A. Harley Davidson should invest in Market Penetration in the regions where it is very sluggish. The company should supply enough units in the countries of Europe, Asia and the Pacific with competitive and affordable prices. B. The official website must be improved with good brand image through the use of better marketing colors and especially with cultural influences for Europe and Asia and not just for American consumers. VII. SWOT Analysis Recommendation: Market Penetration Strengths – increase of market share in Europe and Asia – availability of supplies in Europe and Asia – more name recall – increase of good brand image • Weaknesses – risky – fast production of supplies for the regions is costly – defects upon production are inevitable • Opportunities – H. D. may be the most popular brand of motorcycles in the world – May and will conquer the highest/largest market share of Motorcycle Industry in the whole world • Threats – outcome may be negative – sales may not meet expenses – production of supplies may be time-consuming
VIII. Conclusion After carefully analyzing the case of Harley Davidson, the best solution I can give is to go on Market Penetration. Even if the company has already established its name and brand, most European and Asian countries still prefer those brands that are most available and affordable in their areas. One very relevant reason why H. D. has a small market share in these regions is its being expensive. While there are a lot of competitive brands mostly made from Asia, H. D. still has an edge and an advantage among these brands.
Unlike the others, H. D. specializes on motorcycles alone and this may be a competitive advantage for Harley because it illustrates that the company is focused only in the motorcycle industry. The improvement of its website through the use of better colors and images might be a very good idea to increase sales and brand consciousness on consumers. But the best improvement for the website that I could suggest is to add cultural touches from Asian and European cultures. With that, consumers from all countries may be able to relate with the brand.