Case: Harley-Davidson: Chasing a New Generation of Customers
Despite record sales in 2006 and a commanding share of the heavyweight motorcycle market for the previous decade, Harley Davidson had to take new action to maintain its growth. Although the company enjoyed continued growth in the 2000s and its brand image was strong, its core customer base of Baby Boomers was aging. In 1987, the median age of a Harley-Davidson customer had been 35; by 2007, it was 47. Hence, Harley Davidson’s major focus of its outreach effort was to attract more young adults, who somehow perceived this brand to be expensive and intimidating to a certain degree. Furthermore, Harley-Davidson encountered fierce competition from companies primarily based in Europe and Japan. For example, many of the Japanese companies competed mainly in the sport bike category, but they all offered copycat designs of Harley’s styles in the cruise space. The Japanese bikes clearly competed with the Harley Davidsons in its goal to attract younger customers in the U.S., since they had lower price points, faster speeds and the desired quality for the young generation. Hence, Harley-Davidson was in the dilemma to either continue to stick to its mainstays – “the big loud machines or to compete with Japanese competitors for the sporty, less pricey motorcycles geared toward the younger, hipper crowd.” Despite the ongoing outside competition and its struggle to find customer base of young generation, the company did not give up easily and tried hard to stay in the market. For example, in order to stimulate its growth level and to keep its marketing efforts going, Harley-Davidson hired Mark-Hans Richer, CMO who through the average 27-month tenure (for CMO’s Harley) had teamed up with others to come up with a strategy to find a solution that would be appealing to younger customers and create loyalty while preserving the loyalty of the core customers. For instance, Richer and his team conducted surveys and...
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