International Marketing Report on

By: Amritraj D.Bangera (1MS09MBA04)

Introduction
Harley-Davidsonis an American motorcycle manufacturer. Founded

in Milwaukee, Wisconsin, during the first decade of the 20th century, it was one of two major American motorcycle manufacturers to survive the Great Depression.Harley-Davidson also survived a period of poor quality control and competition from Japanese manufacturers. The company sells heavyweight (over 750 cc) motorcycles designed for cruising on the highway. Harley-Davidson motorcycles (popularly known as "Harleys") have a distinctive design and exhaust note. They are especially noted for the tradition of heavy customization that gave rise to the chopper style of motorcycle. Except for the modern VRSC model family, current HarleyDavidson motorcycles reflect the styles of classic Harley designs. Harley Davidson's attempts to establish itself in the light motorcycle market have met with limited success and have large ly been abandoned since the 1978 sale of its Italian Aermacchi subsidiary. Harley-Davidson sustains a loyal brand community which keeps active through clubs, events, and a museum. Licensing of the Harley-Davidson logo accounts for almost 5% of the company's net revenue.

Product Profile
The classic Harley-Davidson engines are two-cylinder, V-twin engines with the pistons mounted in a 45 "V". The crankshaft has a single pin, and both pistons are connected to this pin through their connecting rods.This 45 angle is covered under several United States patents and is an engineering trade off that allows a large, high-torque engine in a relatively small space. It causes the cylinders to fire at uneven intervals and produces the choppy "potato -potato" sound so strongly linked to the Harley-Davidson brand.
Big V-twins

F-head, also known as JD, pocket valve and IOE (intake over exhaust), 19141929 (1,000 cc), and 19221929 (1,200 cc) Flathead, 19301948 (1,200 cc) and 19351941 (1,300 cc). Knucklehead, 19361947 61 cubic inch (1,000 cc), and 19411947 74 cubic inch (1,200 cc) Panhead, 19481965 61 cubic inch (1,000 cc), and 19481965,

74 cubic inch (1,200 cc) Shovelhead, 19661984, 74 cubic inch (1,200 cc) and 80 cubic inch (1,345 cc) since late 1978 Evolution (a.k.a. "Evo" and "Blockhead"), 19842000, 80 cubic inch (1,340 cc) Twin Cam 88 (a.k.a. "Fathead") 19992006, 88 cubic inch (1,450 cc) Twin Cam 88B (counter balanced version of the Twin Cam 88) 2000 2006, 88 cubic inch (1,450 cc) Twin Cam 95, since 2000, 95 cubic inch (1,550 cc) (engines for early C.V.O. models) Twin Cam 96, since 2007, 96 cubic inch (1,584 cc)

Twin Cam 103, 20032006, 2009, 103 cubic inch (1,690 cc) (engines for C.V.O. models), Standard on some 2011 Touring models such as the Road King Classic and Road Glide Ultra and optional on other Touring Models like the Road Glide Custom and Street Glide. Twin Cam 110, since 2007, 110 cubic inch (1,802 cc) (engines for C.V.O. models)

Small V-twins

D Model, 19291931, 750 cc R Model, 19321936, 750 cc W Model, 19371952, 750 cc, solo (2 wheel, frame only) G (Servi-Car) Model, 19321973, 750 cc K Model, 19521953, 750 cc KH Model, 19541956, 900 cc Ironhead, 19571971, 900 cc; 19711985, 1,000 cc Evolution, since 1986, 883 cc, 1,100 cc and 1,200 cc

Harley-Davidson Culture
According to a recent Harley-Davidson study, in 1987 half of all Harley riders were under age 35. Now, only 15% of Harley buyers are under 35, and as of 2005, the median age had risen to 46.7.The income of the average HarleyDavidson rider has risen, as well. In 1987, the median household income of a Harley-Davidson rider was $38,000. By 1997, the median household income for those riders had more than doubled, to $83,000.Harley -Davidson attracts a loyal brand community, with licensing of the Harley-Davidson logo accounting for almost 5% of the company's net revenue ($41 million in 2004). HarleyDavidson supplies many American police forceswith their motorcycle fleets.Harley-Davidson motorcycles have long been associated with the subcultures of the biker, motorcycle clubs, and Outlaw motorcycle clubs, or one percenters.
Origin of "Hog" nickname

Beginning in 1920, a team of farm boys, including Ray Weishaar, who became known as the "hog boys," consistently won races. The g roup had a live hog as their mascot. Following a win, they would put the hog on their Harley and take a victory lap. In 1983, the Motor Company formed a club for owners of its product taking advantage of the long -standing nickname by turning "hog" into the acronym HOG., for Harley Owners Group. HarleyDavidson attempted totrademark "hog", but lost a case against an independent Harley-Davidson specialist, The Hog Farm of West Seneca, NY, in 1999 when the appellate panel ruled that "hog" had become a generic term for large motorcycles and was therefore unprotect able as a trademark.On August 15, 2006, Harley-Davidson Inc. had its NYSE ticker symbol changed from HDI to HOG.WHQG, a mainstream rock radio station which serves the Milwaukee metropolitan area, uses the moniker in their official callsign (102.9 The Hog) as

a tribute to their home town motorcycle manufacturer, as well as its fans and riders.
Harley-Davidson Riders Club of Great Britain

The Harley-Davidson Riders Club of Great Britain (est 1949) was the first British riders club and organized national rallies and ride -outs from the outset. The 1982 rally began a popular run of events, probably due to the good fortune of having William G. Davidson attending his first rally outside the U.S., in Great Britain. He is thought to have been more than curious to discover how the secret "Evolution Motor" had found its world exclusive on the cover of the spring edition of the HDRCGB magazine, the "Harleyquin", but having a forgiving nature, Willie G. returned in 1984, along with Vaughn Beals and Len Thomson to officially show off the Evolution engine by bringing a test ride fleet to the second Brighton International Super Rally run by H.D.R.C.G.B. The demonstration rides were the first at any European Rally. The club now has circa 1,800 members throughout the U. K., U.S.A. and Europe not forgetting their founder member in Australia. The club is split into regions and most hold rallies during the summer culminating in the club's International Rally. Harley Owners GroupHarley-Davidson established the Harley Owners Group (HOG) in 1983 to build on the strong loyalty and fraternity of Harley -Davidson enthusiasts as a means to promote not just a consumer product, but a lifestyle. The HOG has also served to open new revenue streams for the company, with the production of tie-in merchandise offered to club members, numbering over one million strong. Other motorcycle brands,and other and consumer brands outside motorcycling, have tried to imitate the Harley -Davidson's success in this endeavour by creating factory-sponsored community marketing clubs of their own.HOG members typically spend 30% more than other Harley owners, on such items as clothing and Harley -Davidson-sponsored events.In 1991, HOG went international, with the first official European HOG Rally in Cheltenham,

England. Today, more than one million members and more than 1400 chapters worldwide make HOG the largest factory-sponsored motorcycle organization in the world. HOG benefits include organized group rides, exclusive products and product discounts, insurance premium discounts, and the Hog Tales newsletter. A one year full membership is included with the purchase of a new, unregistered Harley-Davidson.In 2008, HOG celebrated its 25th anniversary in conjunction with the Harley 105th in Milwaukee Wisconsin .

Harley-Davidson's Marketing Strategy Overcame Competition

As many enthusiasts may describe it, the pride of owning a HarleyDavidson is the pride of owning an 'American Icon'. Harley-Davidson's (HD) positioning strategy can best be defined by its mission statement: "We fulfil dreams through the experience of motorcycling- by providing to motorcyclists and to the general public an expanding line of motorcycles, and branded products and services in selected market segments." Now in its 100th year, however, the ideal of owning an 'American Icon' has slowly dwindled o ut of the public's mind, due mostly to the competition from Japanese manufacturers like Honda and Yamaha. HD's strength's of its powerful brand image, maintaining good customer relationships, strong financial position, and superiority of technology and design are hindered by its weaknesses related to product capacity and unfulfilled demand for their products2.
Strategic Direction and Marketing Objectives

HD has chosen the strategic direction of targeting a younger market that is technologically conscious i n order to increase its share in the performance cruiser market space. With the introduction of the new V -Rod motorcycle, HD is in a position of attaining a sizeable share in the performance cruiser marketplace. To target the younger market with the new pr oduct line, the company has adopted the following marketing objectives: to expand its current market (market expansion), diversify its product line (product diversification), and modify its marketing mix t o target a younger demographic. During the 1970's, HD was facing a decline in market share due to increased competition

with Japanese companies. By phasing out weak models, becoming more selective, and limiting sales and promotions, HD was able to carve out a niche in the marketplace which it enjoys today3. Now again faced with a period of decline, HD is relying on its newly adopted marketing objectives. First, HD needs to expand its potential customer base to include enthusiasts and non enthusiasts males in the 35-44 age group. This is accomplished through the introduction of the V-Rod and positioning it in the market to a younger demographic. Secondly, HD needs to position the V -Rod to also appeal to first time buyers of motorcycles. HD's strong brand identity can help pull in new clients. Third, HD has to set an appropriate marketing mix that will help attract a younger consumer base. By using the low -end approach, which involves attracting a young audience to a brand name product with a low price tag (similar to what Jaguar and BMW have done), HD can expan d its popularity to the domestic and international market.
Marketing Mix Elements

For Harley-Davidson's marketing objectives to be successful, the company has to implement the four elements of a marketing mix for the V -Rod. These four elements are strategies that involve the product, pricing, promotion, and distribution.The product strategy is any decision that helps the company continue to develop new products around its signature American image and positions the company in the market as such. The main r eason for the introduction of the V-Rod was the need to create a bike that would appeal to a younger demographic and attain a greater market share for the company. By using the low-end targeting method (as discussed previously) with the introduction of the V-Rod, this can be considered HD's first step toward implementing its strategic and marketing objectives. As for the pricing strategy, HD must be careful to implement a pricing decision based on the low -end targeting method. Priced at $17,000 MSRP, HD's V -Rod has the second highest

price tag in the performance cruiser market. Although HD does have a 22% share of the total market, HD's pricing strategy has three main factors that have influenced how it has priced the V -Rod: 1) the used motorcycle market, 2) lower priced motorcycles, and 3) HD's inability to keep up with demand4. In order for HD to attain a greater market share, the company must examine how these three factors will continually play a role in pricing and adjust accordingly.The Harley-Davidson Corporation has found multiple ways to implement its promotion strategy. HD's primary promotional tool since 1983 has been the HOG. The company's advertisements and commercials are focused around female images. Since 93% of bikers are males, the HOG advert ising campaign has been successful for decades5. HD also uses another strong promotional campaign through its cafes, located in most dealerships. HD has also developed an interactive website (www.harley -davidson.com). The website gives the company the chan ce to expand its operations online. Finally, HD's most important promotional tool is the brand image of a truly American product. Such a tool appeals to the domestic market, and owning a Harley -Davidson bike fits well into supporting the national feelings of pride for America.HD's distribution strategy can best be described by its creed found on its website: "Harley-Davidson's dealer's are the company's life -line to our customers, with a wide variety of product offerings, dealer's provide knowledge, service , and information to riders out on the road." The networks of dealers established by HD are placed in areas that provide access to the largest concentration of potential customers. These dealerships are used to distribute products, accessories, and merchandise. HD also promotes its motorcycles through dealerships with marketing programs, shows, and public relation programs. Demo bikes are also made available at events like Daytona and Sturgis. HD also has a non-dealer network of mid to high-end department stores like Costco's and BJ's. These outlets are meant to appeal to the non -enthusiast.

Timing, Cost, Return, and Feedback of the Marketing Plan

Before the marketing plan and strategy for HD can be introduced, an analysis of the timing at which the plan is to be implemented, the cost and return of the plan and the feedback involved in continually impr oving the product must be done. The most strategic timing for the plan is at peak buying seasons such as around bike demo events and seasonal shopping. It is a t these times that people are most interested in new products like the V -Rod and more likely to have the assets to purchase the product. The cost of implementing the marketing plan is going to be related to the assets involved in the development and research, as well as the production of the V-Rod and the promotion/advertising involved in making the V-Rod known to motorcyclists and non-enthusiasts. The optimal return that is desired from the implementation of the marketing plan is a sizeable and profitable share in the performance cruiser market. A substantial share in the market would be attributed to HD's strategic plan of attracting new 'low -end' buyers. This group of buyers is a younger demographic compared to HD's traditional consumer base. Attaining such a group would most certainly guarantee HD future business by at tempting to gain brand loyalty. The most important aspect of understanding the functionality of the marketing plan is the feedback involved from the consumer. To comprehend why or why not a certain aspect of the marketing mix is working, consumers of the product must be allowed to give their input. Continual and efficient uptake of data from the customer, whether through surveys or questionnaires or any other technique is critical in order to see whether the marketing plan implemented is working accordingly as planned.