Harley Davidson Company Essay

Situational analysisHarley Davidson, an international motorcycle company, started out as a sm each iii spell operation in 1903, by the Davidson brothers and William Harley manu particularuring heavyweight motorcycles. This included financial overhauls for the motorbikes, accessories and incitered app atomic number 18l. It experienced outstanding victory during both World warfares, and managed to survive the moveing times of the Great Depression. After World War II, Harley Davidson brand begin to build on the image of the V-twin cylinder engine established in the 1920s by shifting from manufacturing military bikes to recreational ones. During the 1970s and 1980s Japanese competition nearly undone the company. Competitors introduced technological advanced bikes at a lower cost payable to mass intersectionion. Technological advances and economic science of scale and efficiencies made competitors reapings superior in some instances. Harley replyed by a re-evaluating its tr ade outline centered on a lifestyle image.This included a re-organization and brand building program, including the Harley Owners assort (HOG), Harley Davidson was able to re-capture its merchandise share. It established these groups along with better client armed service that helped it establish itself as a dominate company in the motorbike industry. It had a differentiated focus and various target markets as the environments changed. It was positioned effectively as a way of life with a sense of freedom as conflicting to selling the surpass motorbikes. The merchandise campaigns focused more on the lifestyle associated with the product and worked on its complaisant image. The merchandise team used preeminence to create more awareness of the product by reinforcing Harley from a psychological perspective as a symbol of freedom, developing and maintaining family relationships.Harley Davidson southwesterly Africa was established in 1996 and has prospered due to actually me ttlesome annual growth rates. It succeeded as an excitedly driven brand, one that customers choose for a sense freedom, biker image or as a status symbol. It is this emotive response that Harley Davidson capitalizes on in its marketing strategy and that is re-enforced with the Harley Owners Group magazine, events and the international customer rental service. Despite the companys success it faces some unique challenges. Currently all merchandiseis imported from the U.S.A., as a result price decisions are problematic proportional to competitors. Harley continuously evolved its brand exactly lacked focus on black forthcoming consumer (black diamonds) and on women initially. It will admit to do some valuable market research and match the best way forward with very careful implementation of the strategy to best target black diamonds and append growth in this untapped, spunky disposable income market.1 Product insuranceProduct Policy is defined as A strategic rule or rules coveri ng how a good or service is promoted to potential consumers (Kotler and Keller, Year). Harley-Davidson has since grown from one dealership to seven independent dealerships between 1996 and 2007. Harley product policy was to focus more into customers demand sort of than the company, this is the strategy that was introduced in the early 1980s and was afterwards implemented in entropy Africa. These customer-orientated services have differentiated the company from competitors, in the minds of customers in South Africa as it was about image, sense of Freedom and status. This help in dismissing the myth / reputation of its bad son image. This was seconded by the gender split of 28% female and 72% of males riders in South Africa. Harley South Africa setout to promote Harleys into females who are independent with high salary income as the new market segment the strategy was to treat them as equals and as owners in their own right. military post 2007, the product policy changed to Black Diamonds with an effort to attract and gain the black market into Harley riders.Their marketing strategy was different as it had done very little above the line advertising, dealers were given freedom to determine their own promotional activities modified to their own clients needs and demands. Classification Specialty goods Customers are unforced to make an extended search to find Harley and in some cases, might be willing to travel 20 or 30 KM to find the bike. Marketing mix is a universal phrase used to describe the different kinds of choices organizations have to make in the process of bringing a product or service to market. The Product which is one of the 4Ps is used in defining the marketing mix and is categorized into 4 pillars namely Product Mix Product Design Product growth and Product Life Cycle (Kotler & Keller, 14th Edition)1. PRODUCT MIXProduct policy lies at the life of the marketing mix and encompasses all qualitative aspects of the products offered. Product-m ix refers to the range of products offered by an institution. Offering products that are valued and demanded by customers is key to the success of Harley in South Africa.2. PRODUCT DESIGNThe goal of product design is non to create a different product to satisfy every possible client need. Harley should design products that respond to some(prenominal) different needs with only a few variables. Product design variables must be appropriate for the markets that the Harley has decided to target.3. PRODUCT DEVELOPMENTProduct development is the process of continually refining client-oriented products. It includes several phases, such as exploring customer needs, screening ideas, evaluating products through pilot testing, revising productdesign establish on the results and finally, launching the products. All of these phases are intertwined.4. PRODUCT LIFE CYCLEBelow is the summary of the quartette phases of the Harley product life cycle which include introduction, growth, maturity and de cline.Core Benefits of owning a Harley* Harley members have an enduring relationship built on trust and dependability supported by good service and meaningful advice as around of the riders especially females had no technical capabilities of some of the riders. * Become part of the Harley family which include meeting with none associates, share a cup of coffee with new riders and in any case talk to a friend. This has made most riders to have a sense of belonging. * Harley offer in-house finance and insurance program for riders / customers. * A salutary one-year membership in the Harley Owners Group (H.O.G) comes with every purchase of a new, unregistered Harley motorcycle.* Associatememberships for H.O.G family members and passengers also benefit and become part of the Harley family membership. * Owners memberships are renewable at a give the axe and they dejection also become a member for life. * Full access to the companys website, magazines for each one year, and a subsc ription to the special member publication, toll-free customer service and even a touring handbook for one shot on planning. * Harley also organizes and sponsor special events for H.O.G members including bike parades. *Analysing the bell ringer equity of Harley DavidsonWhen purchasing a Harley, the customer is invest with an added value of a sensation of freedom offered by the product, the sense of belonging and a sense of immodesty offered by a Harley. Harley Davidson does non market the functional purpose of the bike but rather the emotional and psychological attributes of freedom and belonging. The success of the marketing approach and achievement of brand promise of such psychological attributes are well evidenced by the successful financial transaction of Harley Davidson. The following case facts quest that Harley commands higher prices, market share and profitability* Steady share of half the USA heavyweight motorcycle market in 2006 * Annual growth in unit gross sales in South Africa had averaged 46% over the past few years. * Harley still held the majority share in SA market, an estimated 67%. The above indicates that Harley Davidson has wet brand equity credentials. We stern further analyse the brand equity of Harley Davidson by applying one of the flaw Equity Models, The Brand Resonance Model (Kotler and Keller YEAR) and applying the 6 fundamental building blocks of the resonance model to Harley Davidson building brand EquityThe right brand k instantlyledge structures targeted at the right consumer can build hard brand equity (Kotler and Keller YEAR). An analysis of how Harley uses the 3 brand equity drivers (Kotler 2014) to build brand equity 1. Brand elements Harleys brand benefits are less concrete (freedom, sense of belonging etc. and thus it ensures that its brand elements focus on emotional and psychological attributes. E.g. slogans such as The fun is not in the destination, the fun is in the locomote. In addition company marketin g themes never emphasize on the bikes mechanical specifications but rather the associated lifestyle for owning a Harley. 2. Marketing activities product/service Lifestyle How do customers make contact with the Harley brand* Internal Branding Harleys first-string focuses is on internal branding Harley makes extensive use of marketing through its brand community, the H.O.G. H.O.G members have a consciousness of kind or sense of felt company to Harley. i. H.O.G. as a channel for internal marketing has proved to be more effective than Harleys externalmarketing campaigns. ii. HOG is not organic but company-sponsored and facilitated because its one of the main and primary marketing activities. iii. H.O.G is a business strategy. The entire business model supports the H.O.G. iv. Harleys cultivation and engineering of the H.O.G plays a significant role in growing and strengthening the brand * Individual Customer marketingv. Harley places a lot of marketing attention and focus on the in dividual customer. Significant investment is made towards dealerships existence well equipped to cater for H.O.G meetings, vi. High individual customer focus pays off in foothold of, significant sales arising from repeat customers, accessories, customisations of initial purchase, trading upwards after initial purchase etc. vii. Individual marketing to women on a personal basis as they walked into the store with their husbands or cooperators. This was successful in building brand equity amongst female customers. * External Branding is minimal. Harley does not do much mainstream advertising. This has a benefit of cost saving from not having to rely heavily on mainstream high cost advertising channels. Harley prefers to grow through existing dealerships. For example, Dealerships are equipped with coffee areas where staff can connect with customers that walk into the stores.3. Leveraging secondary associations* Harley frequently associates itself with charity rides and motorcycle eve nts. This allows it an opportunity to build on its brand promise of exhibitionism and belongingWhile applying the logic of the brand value chain (Kotler 2014) backwards, high profitability & market share arise from strong customer awareness and customer associations, which in turn arise from successful marketing programme investment. It could be inferred that Harley has generated valuable return from its marketing approach systematically over a period, indicating successful brand equity building over the years.Target MarketHarley Davidsons new target market is the, Black Diamond. This has been their focus as they believe this market has potential. In 2007 the market totalled 2.6 million, while they managed to make sales totalling 709. This meant they had 27% of their target market. This was a drop when compared to the previous year. point 1994 this target market has had opportunities that did not exist before. We also saw the emergence of BEE, which enshrouds to make Black quite a little more financially stable. This thus makes this market an ideal market to focus on.Market profile As much as the female rider target market is growing (28% by 2007) and has potential Harley needs to understand that there are still cultural issues that this market has to deal with. Such issues include that fact that for the black community for a woman to drive a motorcycle it might be not acceptable. Therefore, this would need Harley to come up with strategies to deal with this cultural perception in order for them to benefit from this market.time to come product policyProduct Portfolio Harley Davidson has managed to introduce accessories which are priced differently. This works as those that cannot afford to buy the motorcycles can still settle for other biker accessories thus improving margins. Harley needs to continue to widen its product mix. normally a biker will buy one bike unless they can afford to buy more, therefore for Harley to continue gaining from this consumer they need to also focus more on their accessories which not only bikers like but also non bikers and family members. It was mentioned that 70% of the purchasers were non bikers.Harley however needs to be careful that its product system does not disadvantage its brand. This is seen as an exclusive brand and one needs to be careful that a product diversification does not bring down the value of the brand and result in consumers perceiving it as cheap. It is therefore important that we keep the current product portfolio as exclusive as possible to protect the brand.With the increase in fuel prices, Harley might need to consider a two-way stretch where they might need to produce cheaper motorcycles which are morefuel efficient to encourage people who might not trust to consider investing in a Harley due to costs.Strategies for growthDriving in a Harley indian lodge is a spectacular moment, whether or not the bike itself was bought for show. Cruisers are differentiated products and Ha rley is the leader in that market but that is a double edge sword as its guaranteed popularity and high expectations as a result. They are effectively selling a lifestyle and for more people to buy into it and to keep those on scorecard they need to focus on strengthening the product differentiation, design, brand and service differentiation. Bikes as an extension of disposition and customers will associate with a product that delivers on the highest promise. The design of the bikes and features that are most useful and demand to the rider are important, the customisation has resulted in unique end products for each customer, the quality in terms of performance and conformance need to me maintained at a take aim above the competition.Because customer needs and tastes vary, the service levels required to keep customers happy also varies, the service dimension of the business is therefore important in creating a strategy. By creating awareness about the product and pricing mix and different after sales service options available to the customer (delivery, training, consultation, HOG, maintenance and repair options), Harley Davidson SA can bridge the information gap and raise to a larger market.Targeting the Black diamondThis is one of the fastest growing segments in the South African economic context, the majority being young and qualified and earning a more than descent constant salary. in the main growing up post apartheid, this group is less stereotypical and more adventurous and likely to try new things than was previously not associated with the age segment. This is the new financial muscle of the South African preservation and Harley Davidson should explore it purely as a potential market for its affluence and exploratory capacity if not for its perceived desire for opulence and status. As a product that provides pleasure, fun and value, there is no tenability not to tap into this virgin market that hasnt yet grasped its stance or identityrelative t o the previous politically influenced generation.Harley-Davidson ServicesAccording to Kotler and Keller, The customer will judge the offering by three basic elements product features & quality, services mix and quality, and price (Refer to Fig 12.1). In our technologically age it is now easier for any company products to be replicated and even produced much cheaper too. This makes the element of service quality and mix very important to marketers. The service quality and mix Harley-Davidson offers to its customers will be a source of competitive advantage.The customer value hierarchy diagram places an augmented product at a very high level (Fig 12.2). Customers will value an augmented product because of its additional features and services that come with it. Harley-Davidson should aim for service differentiation at all stages of the buying process and after purchase (Ordering Ease, Delivery, Bike-riding training, customer consulting, maintenance and repair).The customer service pers onnel employed by Harley-Davidson will affect the quality of service. The company would need to ensure that they film and train the right people for the jobs. Employee satisfaction would be critical to making sure the employees have a positive attitude as they work with customers.The marketing department at Harley-Davidson has to understand the needs and wants of their customers in order to satisfy them. Customers are concerned with reliability, service dependability and maintenance costs of the motorbike.A service-quality care system would also need to be set up plus monitoring systems to ensure that all customer complaints are handled properly.