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Harley Davidson

Harley Davidson. 1903 Harley and Davidson begin manufacture Sell four bikes 1904 Sell eight bikes. Harley Davidson. 1915 18,000 bikes manufactured and sold Indian joins the category All bikes sold to the military. Harley Davidson. Post 1918

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Harley Davidson

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  1. Harley Davidson 1903 Harley and Davidson begin manufacture • Sell four bikes 1904 • Sell eight bikes

  2. Harley Davidson 1915 • 18,000 bikes manufactured and sold • Indian joins the category • All bikes sold to the military

  3. Harley Davidson Post 1918 • Model T Ford at times cost less than a Harley bike • Demand collapses • During the recession bikes sold for as much as $2,000 equal to a family car

  4. Harley Davidson 1940 • 90,000 Harleys are manufactured and sold Post 1945 • Bikes bought by criminal elements • Sales increase at a slower rate than cars

  5. Harley Davidson 1947 • Hollister, California • Hell’s Angels 1953 • The final competitor, Indian closes leaving Harley the last of 114 manufacturers

  6. Harley Davidson 1945 • Bike registrations were 200,000 • Sales were flat at 50,000 p.a. • Anecdotal research revealed customers don’t a lightweight bike

  7. Harley Davidson 1960 • Bike registrations were 400,000 1964 • Bike registrations were 960,000 1971 • Bike registrations were 1,400,000

  8. Harley Davidson • Soichiro Honda • Great mechanic • Has his first piston ring patent by the time he is 14 • Opens his first garage at the age of 21 • At 24 he is employing 50 other mechanics • His quality is so highly regarded it is seconded by the military in WW11

  9. Harley Davidson • His factory is bombed and he loses everything at the age of 41 • Purchases 500 field telephone engines and makes 500 bikes • 1949 he is making Honda bikes • 1950 he produces 3,600 bikes • 1952, employs 1,000 staff

  10. Harley Davidson 1960 • Harley Davidson owns 75% of the bike market 1965 • Harley Davidson owns 5% of the bike market • Honda owns 80% How did he do it?

  11. Harley Davidson • Enters his bikes in the prestigious Isle of man races in 1954. His bikes are high quality but too small • However, by 1961 Honda owns most world championships

  12. Honda -Marketing Mix Product • 50cc (small as) bikes • Six colours • First 3 colours – red, white and blue • Averages 55 m.p.h. and cover 300 kms. On 30 cents worth of petrol • Stripped down bikes are regarded as good a watch – perfect. • Product lines expanded to heavier bike by 1965 when 40% of owners wanted to trade up

  13. Honda -Marketing Mix Price Sell for $300 when the rest of the market averaged $1,500

  14. Honda -Marketing Mix Place • In the heart of New York City – Madison Avenue and the like. • 1500 dealers by 1965 in every state. Harley had 880

  15. Honda -Marketing Mix Promotion • Win social acceptance of bikes • Educate the public to this mode of travel • “Go happy, go Honda”, “You meet the nicest people on a Honda”

  16. Honda -Marketing Mix Promotion • Target market portrayed as family, friendly, frugal, easygoing and nice • Ads placed in Life Magazine, Saturday Evening Post • Commercials run on the target market’s (16 – 25 y.o. young professionals) radio stations

  17. Harley Davidson Problem • 1966 all companies suffered losses except Honda. • 1965 he rents bikes - $40M worth

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