International Management - Class 6 - Year 2010/2011
STRATEGY AS POSITIONING
“…the legend rolls on…”
Harley Davidson brand operates in three traditional heavyweight markets: Custom, Touring and Sportster motorcycles. Buell operates in all of the sport markets (heavy or lightweight segment). MV Agusta operates in the sport markets (heavy or lightweight segment) in Europe. I would favor a more direct approach. You have been asked to assess the challenges that HD faces. But you begin with a chart that shows several aspects of HD’s business and strategy that does not, on its own, convey very much and lacks any explanation to link it to the possible problems that HD may face.
Again, your diagram shows that HD has a v different market position opt its competitors, but won’t HD’s Strategic Leadership Council be well aware of this? It’s still unclear to me how this links to HD’s current challenges
In the US, HD achieved a leadership position by targeting baby boomers through superheavyweight motorcycles and the younger audience through lighter Buell motorcycles . In Europe it didn’t achieve such a market penetration (because of the strong brand linkage to the American culture). Its success in the US is due to its biggest assets:
a) its peculiar image conveying American style;
b) customer relationships, achieved through HOG community .
The previous factors differentiated HD from competitors: it has always been strongly market focused unlike its more technology focused competitors. Coherently, it offers highly customized motorcycles that imply higher production costs, yet provide customers with extra value thus increasing their loyalty. Customization also brings some cost disadvantages meaning lack of purchasing power, compared to competitors, who standardize components and often obtain discounts because of high volume orders.
The current strategy increased volumes of traditional models, typically bought by baby boomers. Instead, the Buell...
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