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Student Name- Hunan
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With the ramified economic changes, every organization need to strengthen the overall outcomes and sustain the business in long run. This report reveals the key implication of the case study of the Harley Davidson and showing the overall program which helps in strengthen the work process outcomes. In context with the case study, set up, it has been found that Harley-Davidson, founded in 1903 by William S. Harley and 3 Davidson brothers with a characteristic feature of 2 cylinder and v twin engine with rumbling sound was a popular bike among the baby boomer generation. Harley Davidson has been very thoughtful in providing the right quality to the customers across the places that have got its brand value for years and continues to be.
The products offered why Harley Davidson does not remain with bikes or motorcycles but also includes engines, motor clothes merchandise, parts and accessories, rentals via authorized Harley Davidson rental dealers. It has been famous for its tailor-made motorcycles.
The report highlights the insights into the company’s efforts to be number 1 and the hardships that they had to go through in order to become a resilient business with profits coming in consistently. Various strategies adopted by Harley have been discussed, case analysis has been done with reference to Harley’s work style and initiatives (Agnihotri, 2013).
Harley has been a profitable venture throughout the years despite the difficulties in the Global automotive market. Harley Davidson has been competing in the foreign and domestic market with personal sales to support its goods and brands. Following are the strategies adopted by Harley Davidson. However, these strategies have been adopted by company to generate the core competency in the market and strengthen the overall business outcomes.
Place- Harley-Davidson provides the space for customers to experience, understand and then buy the motorcycles. They have different outlets by dealerships in various parts of the world. The dealers also provide motorcycles on rent at many outlets. Apart from offline the online presence of the other merchandise and clothing accessories, Harley-Davidson provides the opportunity for buyers to experience the online shopping of the by-products of the brand Harley Davidson.
Promotion- The personal selling approach of Harley Davidson is a very effective source since it gives the buyers the experience to drive and touch the bike for real at its approved dealerships. The promotional program of the company is linked with the social media and aligning the interest of the business with the overall outcomes. It is also into public relations through ‘Harley owners’ group’ that keeps on organizing at different locations in order to promote and provide awareness to the prospective buyers in order to gather a large number of customers attention (Keller, 2017).
Product- Harley Davidson offers a variety of products as per its standards. Apart from motorcycles Harley Davidson also offers engines motor clothes and merchandise and collections. Hindi parts and accessories and Harley Davidson provide are also the exclusive offerings. Harley-Davidson provides the rental motorcycle at some of its dealerships. The products of the company is based on the undertaken strategic approach and considering the proper group segments with their choices and luxuries life style.
Price- Harley Davidson enjoys the premium pricing on the ground of uniqueness of the motorcycles, craftsmanship and durability that the motorcycles offered. It has a distinctive marketing positioning that enables it to cater to the large audience even at the high price. However, the pricing set up for the Bikes offered in market is set up with the different strategies and set up process which helps in attracting the particular rich people segments and undertaken work group. Apart from the marketing mix approach various strong highlighted reasons for its creditable success over the years are discussed as follows:
HOG– Harley owners’ group was introduced by Harley in order to connect with a widespread fan population with a motive to keep competitive advantage through personal touch with the customers among the cut throat competition. With one year of free membership to new members Harley-Davidson has been able to keep the constant craziness among motorcycle fans (Van Nimwegen, & Kleiner, 2010).
Movie influence- Harley-Davidson got influenced with the reaction of people all over for the movie ‘Easy rider’ that let them modify their own bikes in order to get the look as it was in the movie. Being the quick action taker Harley Davidson came up with the similar looking bikes as Captain America in the movie. Thus, giving people the chance to buy Harley motorcycles instead of modifying their existing ones.
Service to the military- Harley-Davidson has been a strong participant during world war 1 and world war II. It got 50000 bikes to the military during world war 1 and serviced the military with its all output during world war 2. Harley Davidson riding academy that is named as ‘Hero’s right free’ program launched for the military veterans.
Product development- Harley Davidson capitalised on the famous brand value and craziness among the people and, hence, introduced other products that could associate the non-motorcycle audience with the company. Thus, manufactured jackets and other Harley wearables (Keller, 2017).
Distinct identity- Harley has been able to collect brand recognition as an individualism, rebellion, freedom that most of the American youth fans related to. This is helpful to set up strong overall outcomes and set up distinct identity with the undertaken work approach which helps in accomplish the overall outcomes and setting up the program work set up approach.
Therefore, it can be calculated from the above highlights that the brand strategy of Harley Davidson was not a push strategy but a pull strategy. Company has been acting according to the brand perception and recognition by adding to its value through increased community participation and provision of free of cost benefits for customers creating long term impact on its business.
Threat of new entrants- Harley-Davidson was well aware of the existing competition and the coming competition in the market and worked on to keep the wide audience with the company satisfying the customers in the long term. It followed the Japanese total quality management system, a concept that was brought up by Joseph and Jurans. Thus, it was able to eliminate the unnecessary wastage of resources in the production process while keeping the stock or batch size limited to 35000 bikes per batch so as to get down the cost to around 50%. Thus, eradicating the risk due to new entrants into the market (Hubbard, Rice, & Galvin, 2014).
Threat of suppliers- The major suppliers of Harley-Davidson manufacturing plants are steel electrical equipment and shifting services. The power of multiple suppliers and fans across keeps strong hold on the supplier power. Nonetheless, company has failed to set up backward and forward approach which is one of the failures to create the value program and resulted to the low quality of the before and after sales services. The service canter set up by the company is also not providing the uptomark services which could be another issues and showing the threat in market to accomplish the set objectives.
Bargaining power of the customers- There are several companies that have already come up with heavyweight cruiser bikes for example; Bajaj, Royal Enfield, Suzuki, Honda. Therefore, such imitation may pose a threat of the customers capacity of bargaining but still the market image that the brand holds protects it from being carried away by the customers sons customers would want to go with the brand value.
Threat of substitution- A biker would always go with the bike option even when a sports car is available therefore unless a price affordability becomes an issue this substitution chance remains low.
Ansoff matrix is a tool that helps in strategic planning and framework done by the senior managers, marketers for the future growth and marketing strategies of the business. It consists of four strategies that are defined below.
1. Market penetration strategies- This refers to the strategy of increasing sales to open existing products to an existing market so as to augment the market share as well as revenue size. Harley-Davidson has been able to gather and use audiences’ attention throughout and has been able to retain the current market (Agnihotri, 2013).
2. Product development– The strategy refers to introduction of newly made products to the existing operation market. Harley introduced performance motorcycle Buell into the existing market that did not perform up to the image of the company and customers’ expectations. Thus, it failed even after potential publicity efforts. Therefore, in order to bring success to the new product into the existing market companies should strictly abide by the market expectation current trends which could be done by in-depth research and development process.
3. Market development- Market development strategy works on to develop a new market through entering a new race with the existing products. Harley has been augmenting its business reach globally and has earned the importers from Australian and south Pacific as well.
4. Diversification– this strategy refers to the introduction of new products into a new market. Harley Davidson came up with the introduction of new products like jackets, shirts and accessories like hats, keychains (Keller, 2017).
Opportunities- Harley increased the US retail by serving two young adults, Africans, Hispanics and women riders that brought it twice the revenue from these customers. The rising demand for professional writing and craze among the youth and women population riders has a significant impact on the market demand and future opportunities for Harley Davidson in the long term (Michigan State Police, Precision Driving Unit, & United States of America. (2018).
Threat- Due to aggressive competition approaching the market domestically as well as internationally it is a matter of core attention for Harley Davidson to approach the issue with quick intensity. Imitation of motorcycle designs by other manufacturers can reduce the chances of getting the marginal customers said they would ship to price effective brands. Electric vehicles are in trend and promoted for its pollution free benefits that may also cause a threat to Harley Davidson (Van Nimwegen, & Kleiner, 2010).
Pricing strategies- In the pricing strategy approach the company’s lower the price value of their products in order to capture more market but in the case of Harley-Davidson it’s not possible due to its brand image of luxury premium that me distance the premium customers if done so. Harley Davidson makeup for the premium price by maintaining the small batch size of 35000 units by applying just in time approach.
Differentiation- Differentiation is adopted by companies to maintain the distinct brand image from the existing competitors. Since the product could be copied but the brand image and perception in the market could not be copied and this is what any company code capitalises on.
In case of Harley many of its competitors imitated the cruiser heavyweight by concept but the different strategy of in order to connect with its customers and develop the emotional retainment is the after Sales service and experience that it provides through its Harley owners group. This type of strategy for other businesses like Japanese companies could be expensive enough since there are other costs that are huge like advertising and promotional costs (Wismantoro, & Pratiwi, 2017).
Lock-in- The setting up of standards and bars by the company that entertain customers’ expectations is known as lock-in.
Harley has been able to establish and maintain the authoritative position in the world of motorbike a long time now and enjoys the brand image and recognition that is difficult for other brands to compete with (Stanfield, 2012).
- Harley also deals in provision of consulting services motorcycle rental and instruction classes to the customers who want to have customised bikes through the dealerships. In the recent contract with Hero MotoCorp Hatley Davidson will be selling its brand via production of high-end bike models that would be done by Hero MotoCorp. Hero MotoCorp will also be assisting for after sales and bike parts services.
- The capacity of manufacturing space at Harley Davidson is less due to scattered manufacturing. Hence, it would have to provide information, ideas and strategy at the forum in addition to the point of purchase dealerships as per the supplier advisory council.
- Today the young riders have different mindsets and interests when it comes to cruising bikes in contrast to their old generation riders. Therefore, holiday needs to do an in-depth market research to attain the customer perspective of different age groups towards the brand image and product utility (Thaba, 2018).
- Harley focused on the flexible approach of manufacturing instead of having the bulk production which allowed the company to focus on the variety of models. Thus, producing as per the demand requirements without adding to the cost of storage and excessive production (Grant, et al. 2011).
- Harley makes it mandatory at its dealership to have all the line of Harley replacement parts. That advocates the high standard of the after sales services at all the dealerships across the globe.
- Harley focused on setting up of fresh approach towards human resource management in terms of participation, self-management, open communication and team-based organisation structure. This kind of approach maintains the collaborative environment and fosters the team spirit, hence, giving the cordial relationship message to inside the company and to external environment.
- Harley Davidson has always kept a positive spirit in terms of dealing with its competitors. This could be analysed from recent example of Harley Davidson when it congratulated the highest sale of Royal Enfield in the luxury two wheelers category. When asked by the media the company said that the next model that the buyers would take up would be Harley, which displayed the healthy competitive spirit (Nastasoiu, & Vandenbosch, 2019).
- The selling expenses over the years has risen with almost equal proportion but the sales over time. Harley needs to put regular attention towards the salary cutbacks and the pressure that the employees went through in 2009-2012. This could lead to negative word of mouth publicity which could eventually lead to the brand image and customers’ perception regarding the company (Schembri, 2019).
- Harley Davidson works with the charitable organization for the educational and developmental cause of the underprivileged children. The company does this to support the community as a whole. Also, to support the women empowerment, the company offers to work with female-owned suppliers.
Harley has been able to earn the distinctive image and reputation in the market scenario it has analysed the need to adopt and applied the cost-effective approaches towards its work process. The points are highlighted below.
Technology- Harley does not employ camshafts, automotive technology, and multiwave cylinders that are employed by the competitors. The company gives the importance to budgeted methods for research and development and other product related features (Pickett, 2018).
Limited production- Harley does not do too heavy numbers of manufacturing and keeps it as the way around 3 lakh bikes annually. Thus, it saves on automation as well as storage cost.
Supply chain- Harley Davidson enjoys a strong dealership and distribution network globally that provides it a cost-efficient reach all over. It is on the path of acquiring more dealership networks globally to strengthen its existing distribution network (Schneider, et al. 2020).
Promotional activities- Harley is majorly concerned on providing a distinct experience and value to its customers. The various programs and engagements it does spreads from mouth publicity. Harley plays strategically on doing promotion for its brand and products through wearable merchandise and other accessories and spends very less on official advertising.
Customers’ faith- The brand loyalty and faith of customers spotlights the way customers deal with the brand through donation, brand loyalty allegiance.
On-demand production- Harley Davidson produce the bike as per customers’ demand and customisation requirements. Thus, it follows the pull strategy of production in the supply chain.
Harley Davidson has been a strategy-oriented company since its inception in 1903. It has acquired a huge customer segment over the years through its customer engagement initiatives, brand value, recognition of prestige and high self-esteem. It has been cost effective through implementation of various strategic models into its business strategy. Harley has catered to diversify its people across the globe capitalising on efficient market research and being abreast with current market happening. However due to its old-style production techniques and low technological investment there could be a threat to the product utility to customers and hence to the brand image and perception in the long run. As per the exhibits shown in the case, over the period of six years the company has lost the net income 11.97% mobile debt equity ratio has been increased to 1.29 due to non-payment of loans back from the customers. Harley Davidson needs to act on the shortcomings that pose a threat to its existence in the long run.
After assessing all the details, it could be inferred that Harley Davidson has been strengthen its business products by providing the unique and unmatchable motorbikes which shows the proper implication and undertaken work activities which is useful to accomplish the set objectives and goals. Nonetheless, the main failure of the company is its related to backward and forward integration which shows the negative impact on its business outcomes.
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