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Harley-Davidson

Harley-Davidson. Rachel Fisher Eugenia Jefferson Jahmela McGhee Aishwarya Sharma. Table of Contents. Introduction Situation Analysis Target Market Profile Objectives Creative Brief Marketing Communication Strategy

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Harley-Davidson

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  1. Harley-Davidson Rachel Fisher Eugenia Jefferson Jahmela McGhee Aishwarya Sharma

  2. Table of Contents • Introduction • Situation Analysis • Target Market Profile • Objectives • Creative Brief • Marketing Communication Strategy • Communication Assessment Measures • Budget • Summary • Appendix Route 1 Route 2 Route 3 Route 4 Route 5 Route 6 Route 7 Route 8 Route 9 Route 10

  3. Introduction • Harley Davidson Motorcycles has struggled over the years to acquire new customers. • Heavy bikes- primary competitors • Triumph, Ultra & Viper Motorcycles. • Sport bikes- secondary competitors • Honda, Yamaha & Suzuki • Motorcycle brands are diversifying their business models through geographical expansion and have interests with other products related to engines • Harley-Davidson Motorcycles have image issues related to rebranding and expanding to a new customer base

  4. SITUATION ANALYSIS

  5. Brand Analysis

  6. Brand Analysis • Who is in the Harley-Davidson Family? • Harley-Davidson Motorcycles • H-D Financial Services (HDFS) • Buell Motorcycles (Datamonitor, 2010) • How might these brands be leveraged? • Focus on one bike model (Sportster) and the myriad accessories available for Harley-Davidson products • Harley-Davidson name needs no increased awareness, the brand must work to change perceptions of their products and riders • Financial services will not receive as much attention with the current economic state and consumer credit woes

  7. Brand Analysis cont’d. • Values • Tell the Truth. Be Fair. Keep Your Promises. Respect the Individual. Encourage Intellectual Curiosity. (Harley-Davidson.com) • Vision • We fulfill dreams inspired by the many roads of the world by providing extraordinary motorcycles and customer experiences. We fuel the passion for freedom in our customers to express their own individuality. (Harley-Davidson.com) • Is having a strong brand an advantage or disadvantage? • Both. They have struggled over the years to acquire new customers without alienating current ones. Harley-Davidson must tread lightly to respect the bond between enthusiasts and new riders • Perhaps the brand needs a shake-up. There are two main types of customers for the brand - Hells Angels and middle aged white guys. Harley-Davidson has a variety of products for every type of rider (and is eager to design new ones to cater to different types).

  8. Competitive Analysis

  9. Competitive AnalysisPrimary (Heavy Bikes)

  10. Competitive AnalysisSecondary (Sport bikes)

  11. Industry & Category Analysis

  12. Industry & Category Analysis • What business is Harley-Davidson in? • Motorcycle & other small engine vehicle manufacturing. Their secondary is the apparel/accessories retail and auto parts retail (Hoovers, 2011) • What are the trends in this industry? • Motorcycle engines sizes and motorcycle weights are increasing in the United States (Morris, 2009) • The median age of motorcycle owners have increased from 27.1 years in 1985 to 41.0 years in 2003 (Morris, 2009)

  13. Industry & Category Analysis Cont’d. • What is the reputation of the industry with consumers? • Owners of motorcycles and scooters are very satisfied with their bikes overall, with a majority rating them either "excellent" or "very good" for comfort, cost of maintenance and repair, fuel economy, and performance. • 88% of respondents were highly satisfied with their bike, with 61% saying they would definitely purchase the same model again (Travers, 2010)

  14. Industry & Category Analysis cont’d. • Is there a cyclical nature of this industry? • The cyclical nature varies depending on geography. Consumers might buy all year long in warmer southern states. But in the northern states with colder temperatures, motorcycle sales might diminish around winter time. Spring time is the height of the riding season. (Kuna, 2010) • What general strategy is used to reach targeted customers in this category? • Harley’s strategy focuses on the full “experience” through HOG communities, localized events, Harley museum and factory tours (Harley-Davidson.com) • Yamaha’s strategy focuses on the sports side of motorcycles such as ATV, racing, snowmobiles, etc… (Yamaha.com) • Honda’s strategy transfers their car attributes to their motorcycles by focusing on safety, technology and the environment (Honda.com) • Suzuki’s strategy focuses on the racing side (Suzuki.com)

  15. Market Analysis

  16. Market Analysis • The U.S. motorcycle market is dominated by four brands • Honda, Yamaha, Suzuki and Harley-Davidson(Datamonitor, 2010) • The sales of sport bikes, touring bikes and dual purpose bikes have increased, while sales of off-highway bikes decreased (Morris, 2009) • Motorcycle brands are diversifying their business models through geographical expansion or have interests in a variety of industries manufacturing a range of goods including automobiles, watercraft and industrial and farming machinery (Datamonitor, 2010)

  17. Market Analysis cont’d. • Loyalty and advocacy levels are high among motorcycle owners when compared with owners in the automotive and boating industries. Motorcycle owners are strong advocates of their brand and dealer (Tews, 2007) • The U.S. boasts an increasingly large Hispanic population - a recent report from Pew Hispanic Center stated that U.S. Hispanics have represented more than half of U.S. population growth since 2000 (Hirsh, 2009) • In past, marketers have been tempted to ignore this group - or, at the least, did little to tailor messaging to it - but it is no longer financially wise to do so

  18. Problems & Opportunities Summary

  19. Key Problems • Average customer age is 47 (Harley-Davidson.com) • Harley-Davidson’s position is particularly precarious as younger riders choose sport bikes -- sleeker, more aerodynamic, high-performance motorcycles over classic Harley cruisers (Tirella, 2009) • Harley-Davidson isn’t heavily courting the Hispanic consumer but achieved some success with the 2010 “Harlistas” campaign (Magazine.org, 2010) • About 80% of all new Harleys are bought on borrowed money. ½ of those are financed through H-D Financial Services (Boyle, 2008)

  20. Key Insights and Opportunities

  21. SWOT Analysis

  22. Strengths of Harley-Davidson • Strong brand image with a cult following • One of the leading American motorcycle manufacturers • Offers more than 30 models of touring and custom bikes through a worldwide network of more than 1500 independent retail dealers and distributors

  23. Weaknesses for Harley-Davidson • Weakening financial performance – bikes bought on credit are now defaulting • Brand image of the old white guy with a long gray beard and tattoos • Current customer base is getting older • The economy has limited luxury and recreational purchases for many people

  24. Opportunities for Harley-Davidson • Unique store events targeting women and Hispanics • Growing global motorcycle market • Focus on customization for image conscious buyers • Courting consumers who are less likely to take out loans

  25. Threats for Harley-Davidson • Heavy weight motorcycles not seen as environmentally friendly (noise & air pollution) • Recent attempts at targeting women have yet to change the masculine image • Economic downturn could continue to affect sales

  26. TARGET MARKET PROFILE

  27. Harley-Davidson’s Current Buyers • Average salary: $78,000 per year (Helyar, 2002) • ~80% of new bikes bought on borrowed money, half of which comes from HDFS (Boyle, 2008) • 29% of HDFS customers are subprime (Boyle, 2008) • 15% of Harley-Davidson buyers are under 35. Half of the company’s sales are to new customers and the other half are to customers purchasing another (Harley-Davidson.com) • Harley-Davidson owners are protective of the brand’s image, almost to the point of hindering possible marketing opportunities (Weber, 2006)

  28. U.S. Riders/Motorcycle Owners • In 2007, there were 7,138,476 registered motorcycles • From 1997-2006, Motorcycle sales increased 243% • The median age of motorcycle owners in 2003 of was 50+ years • In 2009, 90% of motorcycle owners were male (U.S. Motorcycle Market)

  29. U.S. Hispanics

  30. U.S. Hispanics cont’d. Source: M. Isabel Valdes. The 2006 data is consistent with Independent estimates including those from the Pew Hispanic Center and the Census Bureau’s 2006 March Current Population Survey, Annual Social and Economic Supplement. 2007.

  31. U.S. Hispanic Riders (Rosenblum, 2005) • Tend to be in mid-20’s to early 30’s • Looking for the “classic Harley” look • Prefer the following models: • Heritage Softail • Fat Boy • Dyna • Road King • Tend to prefer sport bikes, wider rear tires & high performance engines • Also customize or trick out their bikes more so than Anglos • Harley-Davidson estimates 3.4% of their U.S. buyers (in 2004) were Hispanic

  32. Hispanic Harley Riders • Hispanic males 21-39 • Group and family oriented (Valdes, 2007) • Prefer name brands made in America (Valdes, 2007) • Courageous (Valdes, 2007) • Risk-taker & trendsetter (Burgos, 2006) • Proud of Hispanic heritage and roots(Valdes, 2007)

  33. OBJECTIVES

  34. Marketing Objectives • To increase trial amongst potential Harley-Davidson consumers • To increase Harley-Davidson sales by 17% in the Hispanic market by the end of the campaign • To increase brand awareness especially with younger Hispanic consumers

  35. Rationale for Marketing Objectives • Harley-Davidson focuses on customers they already have rather than on customer that will support their brand in the future • The internet and mobile usage consistently increases among Hispanics • A greater portion of the Hispanic community is younger while the greater portion of the Harley community is older

  36. Communication Objectives • Speak their language figuratively and literally (speak the language of the younger consumers & Spanish) • Celebrate the roots of the Hispanic heritage within America

  37. Rationale for Communication Objectives • Harley had a chance to expand the Harlista community, but they haven’t had strong support after the initial push • The brand has worked more at marketing to existing customers than to future ones • An expensive product with such brand loyalty requires a more interactive experience

  38. Advertising Objectives • Build emotional connection with Harley-Davidson • Increase Hispanic engagement with the brand • Establish rapport among Hispanics

  39. Rationale for Advertising Objectives • Hispanics and Harley-Davidson both enjoy loyalty with their communities • Harley has not used the language of Hispanics, which has undermined their efforts at gaining the trust of this group

  40. STRATEGIES

  41. Marketing Communication Strategy Convince young machismos that Harley-Davidson is an extended family because they are a group of individuals that share a similar passion. Key Selling Idea Celebrating collective freedom while honoringyouthful individualism

  42. Overall Strategies Marketing Objectives Strategies • Brand Awareness • Increase Trial • Increase Sales • Increase brand awareness by educating the consumer about the product • Establish top-of-mind presence with Hispanic motorcycle consumers • OOH ads showcasing our product • Utilize national events to increase product awareness • Utilize social media to drive traffic and to create interaction • Promote campaign with celebrity spokespersons geared towards the intended target audience • Utilize nontraditional media to catch the interest of our target market • Create an interactive environment to enhance the overall motorcycle experience both online and offline • Integrating Harley into Univision events and programming

  43. CREATIVE BRIEF

  44. Overview • Project Goal: • Design a campaign that connects with young Latinos • Get Hispanic consumers to consider Harley-Davidson • Project Objectives: • To increase trial amongst potential Harley-Davidson consumers • To increase sales by 17% in the Hispanic market • Project Sponsor: • Univision • Harley-Davidson • Best Western hotels • Campaign Stakeholders: • Hispanic communities across the country • Mainstream media • Univision • Harley-Davidson • Research insight: • A greater portion of the Hispanic community is younger while the greater portion of the Harley-Davidson community is older. (Census Bureau, 2011) • The Baby Boomers who transformed Harley’s bikes from countercultural totems into American icons is approaching their 60s. (Target Market News, 2011) • Also according to the MIC, in 2008 women accounted for nearly 6 million of the country's 25 million motorcyclists. (Motorcycle Industry Trends, 2010)

  45. Audience • Primary Audience: Hispanic men 21-39 • Juan, age 27. Juan’s parents were born in Mexico and emigrated in their twenties; he was born three years later in Dallas. Juan has been at his blue collar job for the past 5 years, and usually puts in 8-10 hour days. He and his wife just celebrated their 5th wedding anniversary, and are about to welcome their second child, a boy. He is looking forward to sharing his fatherly knowledge and passions, as his father and uncles did with him. • Passions: • Sports • Beer drinker • Appearance (clothing, hair, etc...) • Things that need to be avoided: • Avoid stereotypes with this group as it is ethnically diverse • Avoid clichés • Secondary Audience: • Juan’s wife, Araceli: Hispanic women 21-39 • Research Insight: According to the Motorcycle Industry Council, the number of female motorcycle owners increased nearly 3% in the 5 years from 2003-2008. Also according to the MIC, in 2008 women accounted for nearly 6 million of the country's 25 million motorcyclists. (Motorcycle Industry Trends, 2010)

  46. Message • Communication Message: • Casual yet honest, but funny at heart • One Sentence: • Harley-Davidson shares many values with Hispanics • Selling proposition and key points: • Celebrating collective freedom while honoring youthful individualism • Embrace their status and be proud of who they are • Express their heritage and identity

  47. Medium • Primary Medium and usage: • Television and digital for its reach and accessibility • Provides opportunities for product placement, event promotions, sponsorships and advertising. • Other Media Channels and usage: • OOH, mobile, Radio, Social Media and Internet • These will help with continuity of messaging and will reinforce messages across multiple media vehicles in a cohesive and interchangeable manner • These can be inexpensive • Capitalize on the strong word of mouth that the Hispanic community provides

  48. Visual Image/ Creative Design • Goals: • Use the Bar & Shield logo to increase brand recognition • Reinforce the quality and heritage of the brand • Highlight the passion that Harley owners share with the brand • Effectiveness: • Harley-Davidson branding is familiar to many, and can easily leverage their equity for opportunities in the Hispanic community • Hispanics respond to quality built American-made products (Valdes, 2007) • Hispanics and Harley can be tough groups to enter, but once inside enjoy fierce loyalty

  49. Schedule • The Message • The campaign will run March 2012 through October/November 2012. • Spring time marks an unofficial start to the motorcycle season across the country • October is Hispanic Heritage Month & the “Premios TV y Novelas” awards show is the first week of November • We will pursue a continuous media schedule. • Hispanics are passionate and Harley owners are too. • They are usually watching sports, scripted television and special events, but don’t usually skip commercials. (Portada, 2007)

  50. Budget • Univision TV, Digital, Mobile and Radio • Spending • Funds will cover: production costs for advertisements, maintenance of digital platforms, creation of web series • $5 million • TV - $1,060,000 • Digital - $3,590,000 • Radio - $350,000

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