Harley Davidson Company Essay

Situational analysisHarley Davidson, an international motorcycle companionship, started out as a sm any three man operation in 1903, by the Davidson brothers and William Harley manufacturing heavyweight motorcycles. This include financial receiptss for the motorbikes, accessories and shufflinged appargonl. It experienced spectacular success during both World Wars, and managed to survive the evidenceing times of the slap-up Depression. After World War II, Harley Davidson discolouration begin to build on the image of the V-twin cylinder engine completed in the 1920s by shifting from manufacturing military bikes to recreational hotshots. During the 1970s and 1980s Japanese contr e realwheresy nearly destroyed the company. Competitors introduced technological advanced bikes at a start cost due to mass resultion. Technological advances and economics of scale and efficiencies do competitors produces superior in near instances. Harley responded by a re-evaluating its merchandi sing strategy centered on a lifestyle image.This included a re-organization and stigma building program, including the Harley proprietors Group (HOG), Harley Davidson was able to re-capture its market sh argon. It established these groups along with better client service that help oneselfed it establish itself as a dominate company in the motorbike industry. It had a divers(prenominal)iated instruction and various target markets as the environments changed. It was positioned effectively as a vogue of life with a guts of freedom as opposed to merchandise the best motorbikes. The market campaigns riveted much on the lifestyle associated with the product and worked on its social image. The merchandising team used differentiation to stool more(prenominal) aw arness of the product by reinforcing Harley from a psychological opinion as a symbol of freedom, developing and maintaining relationships.Harley Davidson randomness Africa was established in 1996 and has prospered du e to very senior high school annual growth rates. It succeeded as an worked uply driven carry, one that customers choose for a consciousness 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. disdain the companys success it faces some unique challenges. Currently all merchandiseis imported from the U.S.A., as a result pricing decisions are problematic relative to competitors. Harley continuously evolved its brand barely lacked focus on raw upcoming consumer (inkiness diamonds) and on women initially. It willing need to do some valuable market research and determine the best way forrard with very deliberate implementation of the strategy to best target low-spirited diamonds and increase growth in this untapped, high disposable income market.1 output PolicyProduct Policy is defi ned as A strategic rule or rules covering how a good or service is promoted to potential consumers (Kotler and Keller, Year). Harley-Davidson has since gr aver from one dealership to cardinal independent dealerships between 1996 and 2007. Harley product policy was to focus more into customers take rather than the company, this is the strategy that was introduced in the early 1980s and was subsequently enforced in South Africa. These customer-orientated services adjudge 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 boy image. This was seconded by the sex activity 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 element the strategy was to treat them as equals and as owners in their own decline. co nduct 2007, the product policy changed to Black rhombs with an effort to attract and increase the black market into Harley riders.Their marketing strategy was different as it had done very little supra the line advertisement, dealers were given freedom to determine their own promotional activities modified to their own clients involve and demands. mixture Specialty goods Customers are willing to adjudge an extended search to check Harley and in some cases, cogency be willing to travel 20 or 30 KM to find the bike. Marketing mix is a general 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 Development and Product Life Cycle (Kotler & Keller, fourteenth Edition)1. mathematical product MIXProduct policy lies at the heart of the marketing mix and encompasses all qualitative aspects of the products offered. Product-mix refers to the range of products offered by an institution. Offering products that are apprised and demanded by customers is key to the success of Harley in South Africa.2. return DESIGNThe goal of product material body is non to create a different product to satisfy every possible client need. Harley should image products that respond to several(prenominal) different needs with except a fewer 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, rewrite productdesign based on the results and finally, launching the products. All of these phases are intertwined.4. PRODUCT LIFE CYCLEBelow is the summary of the four pha ses of the Harley product life cycle which include introduction, growth, maturity and decline.Core Benefits of owning a Harley* Harley members have an enduring relationship built on trust and dependability back up by good service and meaningful advice as most of the riders especially females had no technical capabilities of some of the riders. * Become part of the Harley family which include coming upon with subscriber line associates, share a cup of coffee with new riders and overly 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 adept 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 as well benefit and become part of the Harley family membership. * Owners memberships are renewable at a discount and they canful also become a member for life. * Full access to the companys website, magazines each year, and a subscription to the special member publication, toll-free customer service and even a touring handbook for trip planning. * Harley also organizes and assistant special events for H.O.G members including bike parades. *Analysing the Brand equity of Harley DavidsonWhen purchasing a Harley, the customer is endowed with an added value of a sensation of freedom offered by the product, the sense of belonging and a sense of exhibitionism offered by a Harley. Harley Davidson does not market the merrimentctional purpose of the bike except 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 flourishing financial exertion of Harley Davidson. The following case facts indicate that Harley commands higher(prenominal) prices, market share and profitability* Steady shar e of half the regular army heavyweight motorcycle market in 2006 * Annual growth in unit sales in South Africa had averaged 46% over the past(a) few years. * Harley passive held the majority share in SA market, an estimated 67%. The above indicates that Harley Davidson has strong brand equity credentials. We can further analyse the brand equity of Harley Davidson by applying one of the Brand Equity Models, The Brand ring Model (Kotler and Keller YEAR) and applying the 6 fundamental building blocks of the resonance model to Harley Davidsonconstruction brand EquityThe right brand knowledge structures targeted at the right consumer can build substantial 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 realises 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 journey. In accompaniment company marketing themes never emphasize on the bikes mechanical specifications but rather the associated lifestyle for owning a Harley. 2. Marketing activities product/service life-style How do customers make contact with the Harley brand* Internal stigmatization Harleys primary focuses is on natural 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 connection to Harley. i. H.O.G. as a channel for internal marketing has proved to be more effective than Harleys outside(a)marketing 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 government agency in expl oitation and strengthening the brand * Individual Customer marketingv. Harley places a lot of marketing attention and focus on the separate customer. Significant investment is made towards dealerships being well equipped to render for H.O.G meetings, vi. High individual customer focus pays off in scathe of, significant sales arising from repeat customers, accessories, customisations of initial purchase, trading upwards later on initial purchase etc. vii. Individual marketing to women on a personal basis as they walked into the store with their husbands or partners. 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 provide can connect with customers that w alk into the stores.3. Leveraging secondary associations* Harley frequently associates itself with benevolence rides and motorcycle events. 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 sensation and customer associations, which in turn arise from successful marketing course of instruction investment. It could be inferred that Harley has generated valuable return from its marketing approach consistently over a period, indicating successful brand equity building over the years. channelize 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, maculation they managed to make sales totalling 709. This meant they had 27% of their target market. This was a drop when compared to the front y ear. Post 1994 this target market has had opportunities that did not exist before. We also aphorism the emergence of BEE, which carry ons to make Black people more financially stable. This thence 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 thither are still ethnic 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.Future product policyProduct Portfolio Harley Davidson has managed to introduce accessories which are priced differently. This works as those that cannot afford to profane the motorcycles can still settle for other biker accessories thus improving margins. Harley needs to continue to widen its product mix. Usually a biker will grease ones palms 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 even 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 on 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 essential to consider investing in a Harley due to costs.S trategies for growth madcap in a Harley club is a spectacular moment, whether or not the bike itself was bought for show. Cruisers are differentiated products and Harley 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 board they need to focus on strengthening the product differentiation, design, brand and service differentiation. Bikes as an quotation of personality 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 necessary 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 level 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(prenominal) sales service options available to the customer (delivery, training, consultation, HOG, sustentation and reanimate options), Harley Davidson SA can bridge the information gap and appeal to a big 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. Mostly growing up game 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 massiveness of the South African economy and Harley Davidson should explore it purely as a potential market for its affluence and exploratory capacity if not for its comprehend desire for opulence and sta tus. As a product that provides pleasure, fun and value, there is no reason not to tap into this virgin market that hasnt yet grasped its stance or identityrelative to 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 image 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 augment 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 let for service differentiation at al l stages of the buying process and after purchase (Ordering Ease, Delivery, Bike-riding training, customer consulting, maintenance and repair).The customer service personnel sedulous by Harley-Davidson will affect the quality of service. The company would need to ensure that they hire and train the right people for the jobs. Employee satisfaction would be detailed 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 management system would also need to be set up plus monitoring systems to ensure that all customer complaints are handled properly.