A Brand Analysis report on

By: Jay Shah, FMS-B

*From Indian Market Perspective

Brief introduction of the company:

Harley Davidson is among the top

motorcycles producers in the world.

They not only produces motorcycle

but also produce boat, t-shirt, bag,

leather Jacket, Safety helmet and

kind accessories, etc.

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Timeline (Brief History)

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1901: William S. Harley, age 21, completes a blueprint drawing of

an engine designed to fit into a bicycle.

1903: William S. Harley and Arthur Davidson make available to

the public the first production Harley-Davidson® motorcycle.

1906: The first motorcycle catalog is produced by the Company

and the nickname "Silent Gray Fellow" is used for the first time.

1907: William A. Davidson, brother to Arthur and Walter

Davidson joins the Motor Company.

Harley-Davidson Motor Company is incorporated on September

17th.

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1910: The famed "Bar & Shield" logo is used for the first time. It

is trademarked at the U.S. Patent Office one year later.

1914: The Motor Company formally enters motorcycle racing

this year. The first Racing Engineer is William S. Harley. Within

a few short years, team HD is referred to informally as the

"Wrecking Crew" because of their incredible dominance of the

sport.

1916: The Enthusiast begins its reign as the longest continuously

published motorcycle magazine in the world.

1920: HD is the largest motorcycle manufacturer in the world.

New Harley-Davidson® motorcycles can be purchased from over

2,000 dealers in 67 countries worldwide.

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Leslie "Red" Parkhurst breaks 23 speed records on a HD 61 cubic

inch racing motorcycle. Also, the "hog" association starts when the

racing team's mascot, a pig, is carried on a victory lap after each

race won by the team.

1925: Gas tanks on all models now have a distinct teardrop shape.

This basic appearance is set for all subsequent HD motorcycles.

Joe Petrali begins racing for Harley-Davidson. He would become

one of the most successful dirt-track racers for HD, and one of the

most successful racers of all time.

1931: All of HD's remaining American competition is now gone

except Indian (Hendee Manufacturing). Indian and HD are the

only two American motorcycle manufacturers until 1953.

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1933: An art-deco "eagle" design is painted on all gas tanks. This

styling decision was made in part to stimulate the low sales

numbers caused by the Great Depression.

1935: The Japanese motorcycle industry is founded as a result of

Harley-Davidson licensing blueprints, tools, dies and machinery to

the Sankyo Company of Japan. The result is the Rikuo motorcycle.

1946: Harley-Davidson introduces the 45 cubic inch flathead WR

racing motorcycle. It proves to be one of the best racing

motorcycles ever built.

1947: Harley-Davidson begins selling what will become the classic

black leather motorcycle jacket.

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1953: HD celebrates its 50th Anniversary in style.

Hendee Manufacturing, the creator of the Indian motorcycle,

goes out of business.

1957: The motorcycling public met a new motorcycle called the

Sportster® known as the first of the "Superbikes." Another

Harley-Davidson tradition and legend is born.

1960: The Harley-Davidson Topper motor scooter is introduced

and is the only scooter platform the Motor Company ever

produced.

1969: Harley-Davidson merges with the American Machine and

Foundry Company (AMF), a longtime producer of leisure

products.

1982: The Materials As Needed (MAN) application is introduced to

production.

1983: Birth of Harley Owners Group® (H.O.G.)® the Group

immediately becomes the largest factory-sponsored motorcycle club

in the world.

1987: Harley-Davidson is listed on the New York Stock Exchange.

1993: Harley-Davidson buys a minority interest in the Buell

Motorcycle Company.

2005: Harley-Davidson and the Muscular Dystrophy Association

(MDA) mark the 25th anniversary of their partnership.

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2008: The all new Harley-Davidson Museum opens in

Milwaukee . It showcases hundreds of classic and custom

motorcycles, interactive exhibits and never-before-seen films and

photographs.

2009: Harley-Davidson announces expansion into India.

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MISSIONWe fulfill dreams through the

experience of motorcycling,

by providing to motorcyclists and to the general public an expanding

line of motorcycles, branded products and services in selected

market segments.

VISION

HD, is an action-oriented, international company, a leader in its commitment to continuously improve our mutually beneficial relationships with stakeholders .

HD believes the key to success is to balance stakeholders’ interests through the empowerment of all employees to focus on value-added activities.

Harley-Davidson is:

•Fierce individuality•Rebellion against things that are unjust•Different•Innovative•Fearless in the face of danger•Brave•Seeking a better life•Free spirited•Wild•Seeking escape•Adventurous

MANAGEMENT

• Excellent Corporate Governance has been a long standing business practice at HD, because it makes good business sense.

• The HD Management and Board of Directors is composed of accomplished leaders from a range of industries who meet regularly to review Company objectives and plan for future growth.

• These individuals draw on their diverse backgrounds and experiences.

• They are proud HD enthusiasts, and they work to ensure that the decisions made by HD promote fairness, financial transparency and accountability to all our shareholders .

HUMAN RESOURCE:Key points

Incidents that may involve a potential conflict of interest.

Disclosure of any waivers of any conflict of interest.

Regular reports to the Board.

Reassess annually the Human Resources Committee performance.

Establish subcommittees and delegate authority to such subcommittees.

HUMAN RESOURCE:Key points

Committee Duties and Responsibilities is to review

Total compensation

Career development and management successionplans

Make recommendations regarding the selection andretention of officers

Target Market

“Typical” Harley Owner: White males over the age of 35 with annual incomes over $80,000.

Anyone with potential to become loyal to the brand and the Harley-Davidson community New focus on “outreach customers” – young adults, women, African Americans, Hispanics, Asians.

The median age of the Harley owners in India is between 35 and 45 years. They can afford its bikes which range from Rs 5.6 lakh (883 cc) to Rs 35.45 lakh (1800 cc). The customers are mostly working executives who ride out in the weekends and holidays.

Brand Positioning

Posi t ion ing Statement : To free-spirited adventure-seekers looking for personal freedom, Harley-Davison is the brand of experiential entertainment that fulfills dreams through the experience of motorcycling and a strong, exclusive community.

The brand values deep emotional connections and brand loyalty, which is built through premium products, services, and experiences.

"Since July 2010, we have sold 1,000 bikes in India, 60% of which are our 883 cc entry level bikes. Customers prefer the Iron 883 because of its 'bad boy' design. HD is an iconic, lifestyle brand and Indian consumers understand that " said Anoop Prakash, MD, HD India.

The Branding Ladder

Repurchase Within Brand Family

First Purchase

Choice Set

Consideration

Model Awareness

Brand Awareness

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What are the 4 P’s of Harley-Davidson?

Product: 13 models available in India.

Following types of products:

Touring bikesSportster MotorcyclesFire Rescue MotorcyclesTrikesUsed bikes

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Price:The prices of HD bikes range from Rs 4.1 lakhs to Rs 29 lakhs.

Place: 13 dealerships across India: New Delhi, Chandigarh, Mumbai, Hyderabad, Bangalore, Chennai, Kochi, Kolkata, Ahmedabad, Indore, Pune, Goa, Jaipur.

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Promotion:

HD has implemented several strategies to promote its motorcycle brand. The products were sold to retail customers mainly through dealer promotions and customer events. Along with the advertising tactics through national television, print, radio, direct mailings and the internet.

The Dealer meetings are held

HOG meets are also taking place

Various AutoExpo’s are targeted

Typical HD Marketing Budget Spent:

Product Life-cycle

Sale

s &

Pro

fits

(R

s.)

IntroductionGrowth Maturity Decline

TIME

HD is in the Growth stage at the moment in India. While it has achieved the Maturity stage in USA decades ago.

Brand extensions

MerchandiseHelmetBoatsClothes (Jackets) MugsCollectibles LighterWatch

Beer

Bars

Product extensions

• Motor Cycles

• Bike accessories

HD and Japanese competition:

In the early eighties, HD claimed that Japanese manufacturers were importing motorcycles into the US in such volume as to harm or threaten to harm domestic producers.

Rather than trying to match the Japanese, the new management deliberately exploited the "retro" appeal of the machines, building motorcycles that deliberately adopted the look and feel of their earlier machines and the subsequent customizations of owners of that era.

Many components such as brakes, forks, shocks, carburetors, electrics and wheels were outsourced from foreign manufacturers and quality increased, technical improvements were made, and buyersslowly returned.

Fostering Consumer Dialogue

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► Consumer-Brand Bonds: Offset consumer differences by focusing on the one thing they have in common - their love for the brand.

► Consumer-Consumer Bonds: Nurture and direct dialogue to strengthen bond between consumers

► Consumer-Firm Bonds: Touch each aspect of the consumer‘s experience

“Close-to-the-consumer” philosophy

► Consumer-Product Bonds: Highlight commitment to evolving product over time while keeping essential elements that make it unique

INTENSIVE STRATEGIES

1) Market Penetration

2) Product Development

3) Market Development

MARKET PENETRATİON

Get some more market share from the existing market(U.S, U.K, and Japan)

Use more E-marketing

Expand the HOG (Harley Owners Group) to India

If the company can provide the customer satisfaction that they are providing to the U.S customers to the Indiancustomers they can increase the sales

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PRODUCT DEVELOPMENT

Females and Younger generation are now coming to this segmentso expand the motor cycle segments to younger generation andfemales.

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MARKET DEVELOPMENT

Harley-Davidson can bring in their vehicles to India because it has a high population and the market potential is also high.

The cost to bring in the old vehicles (old product) to India is so much difficult:

- There are so much environmental laws - Taxes are problems - Levis are high in India

INTEGRATION STRATEGIES

o VERTICAL INTEGRATION

o HORIZONTAL INTEGRATION

Vertical Integration

Just-in-time manufacturing

HD has been backward integrating to maintain control over the quality of suppliers

HD owns most of its distributors

HD is responsible for the delivery of parts and accessories

Horizontal Diversification

ICICI Bank and HDFC Bank provides motorcycle financing, motorcycle casualty insurance and extended service contracts for HD.

They also issue the HD Chrome VISA Card, allowing riders and customers to show their brand loyalty.

MICHEAL PORTER ANALYSISFive Forces Analysis

Forces Strategic Significance

Internal Rivalry LOW-MODERATE

Threat of New Entrants MODERATE

Threat of Substitutes

Products

HIGH

Bargaining Power of Buyers MODERATE-HIGH

Bargaining Power of

Supplier

HIGH

When looking at the rivalry from competitors, Harley-Davidson is doing very well domestically but in the India, larger motorcycles are not used as frequently as are smaller and more efficient bikes, leading to a lower market positioning.

When analyzing the potential new entrants to the motorcycle industry, one must look at it both from a domestic and global perspective.

When analyzing the potential new entrants to the motorcycle industry, one must look at it both from a domestic and global perspective.

COMPETITION IN INDIAN MARKET

SWOT analysis

Strong marketing

Product Quality

Brand Recognition

Trademark Licensing

Supplier relationship

Designer Store Service

Distribution Channel

Wow Biking experience!

Strengths

Weakness

Price factor

Brain drain

Reliant on few suppliers

Market share

Ongoing capacity constraints

Lengthy lead time

Opportunities

The Indian market will sooner become larger than

the U. S market

Customers turning towards value quality parts.

Women and younger riders are increasing

becoming interested in bikes.

Industry registrations of heavyweight motorcycles

are increasing.

Threats

Harleys ongoing capacity

restraints

Competitors of Harley

Davidson

Environmental protection

laws

Higher production Costs

Recession

STRENGTHSCustomer retentionFinancial positionProduct selectionPremium market shareDealer Network

OPPORTUNITIESIncreasing number of ridersIndian industry growthYouth populationAsian industry growth

THREATSUnion relationsGovt. lawsCompetitor diversificationAvailability substitutes

WEAKNESSESDealer inventory systemOverall market shareExpensive productProduct selectionInternational dealer

SWOT Analysis

1. S-O Strategies

a) Expand production of India

b) Expand marketing to female riders

2. S-T Strategies

a) Increase strong brand name

3. W-O Strategies

a) Pursue foreign markets more agressively

4. W-T Strategies

a) Improve employee relationships

GRAND STRATEGY MATRIX

QUADRANT:2 QUADRANT :1

QUADRANT:3 QUADRANT:4

Weak Competitive Position

Strong Competitive Position

Rapid Market Growth

Slow Market Growth

INTERNAL FORCES

• To determine HD’s strengths and weaknesses, aninternal assessment is required

• Harley only has 7.7% of European market share (thesecond largest motorcycle market in the world), and25.3%of the Asia/Pacific region

• Harley-Davidson’s strengths are in the U.S. market, as80% of Harley’s net revenue comes from U.S. sales

• Harley was viewed as sub-par when compared to Britishmotorcycles

• Harley has a reputation for style and quality

INTERNAL FORCES (cont.)

• HD also introduced water-cooled engines, fuel injection, and catalytic converters to improve exhaust emissions

• Harley’s strength in this area is largely due to its marketing abilities in the U.S. market

• Harley customers are extremely loyal to their brand and 90% of Harley owners intend to purchase another Harley

• Management information systems could be used to more effectively manage inventory at Harley. This is currently one of HD’s few internal weaknesses

2011 Worldwide Retail Sales ofHD Motorcycle

Sales

United states

European region

Asia pacific region

Canada

Latin American region

HD’s connection with Sturgis

• Sturgis is a city in Meade County, South Dakota, United States.• The population was 6,627 as of the 2010 census.• It is more popular than some city in the USA

• The Sturgis Rally is a motorcycle rally held annually in Sturgiseach first full week of August.

• It is the biggest motorcycle rally in the world.

• A lot of people comes from thousands of miles of distance.

MARKETING STRATEGIES

Expand into Foreign Markets

India

Europe

Product Development

Expand Motorcycle line for younger market

Target female customers

Buell expansion

Concentric Diversification

Other recreational vehicles

Expand HOG and BRAG owner member groups

MARKETING STRATEGIES

Made new alliances with some local bike companies

to produce low cost

Utilize the ‘Make In India’ drive

Increasıng dıversity programing

Tour

Museum

Increase the advertising

CONCLUSION

• Harley- Davidson has to adopt Indian culture or at least try to

understand its customer’s psyche.

• Must implement latest technology & facilities.

• Loyal customers are not sufficient for company to survive.

• “It’’s a journey but not a destination”

Sources:-HD website-The Times of India-The Economic Times-The Hindustan Times-The Live Mint-Wikipedia

Thanks

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