Question

Please answer below two questions in your own words

Harley Works to Draw in Younger Riders

With motorcycle sales in a slump, Harley-Davidson is boosting its efforts to attract more young riders. Harley has been a high-end, aspirational brand for motorcycle riders for several decades, their image and product line resonating with Baby Boomers and Generation X riders. With those rider groups aging, Harley has seen its sales decline in recent years.

To help attract younger riders, in 2018, Harley is revamping its product development process, focusing on models that appeal to young adults, women, and minorities—in addition to its core market of older white men. This leads to a focus on smaller, more affordable bikes. Fitting this direction is the development of the street class of motorcycles, which are designed for urban riding and have a narrower chassis compared to other Harley models and start at less than $7,000. To improve their cost basis, Harley has also revamped its procurement process to look for more cost efficient global suppliers and has even shifted some of its manufacturing to India. Harley also sees the need to reorient its marketing to connect with younger riders, including shifting marketing activities from general market advertising to local, dealer-centric social activities. In short, the firm sees the need to undertake change across its value chain.

Progress to date is mixed. Younger riders are less likely to ride motorcycles, but Harley argues that the percentage of young riders who opt for a Harley is actually higher than it was with prior generations. Whether Harley will be able increase the number of younger riders is the key to its long-term sales potential.

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Please address the following questions:

1. Will Harley be successful in drawing in younger riders? Why/why not?
2. What other parts of the value chain could Harley revamp to better serve the needs of younger riders? Please explain.

Answer 1

Harley will be successful in drawing in young riders due to the following reasons :

They have revamped their product development process with focus on affordable bikes for urban youth.Since urban youth consists of a substantial chunk of population therefore desired sales may be achieved by tapping this segment.

Harley has also worked on its supply chain management to reduce procurement and manufacturing costs.Further they have changed its marketing strategy from general advertising to local dealer specific social activities to appeal to their target audience.

In terms of value chain Harley has already worked on its backward integration by revamping its procurement and manufacturing activities.To add to it they may add value to the product by offering latest technology and safety features in their bikes by comparing with the latest trending brands.

One important marketing strategy for Harley should be to retain their cult-brand image.For this they may sponsor Harley Davidson bike rally events to create more brand visibility.

Harley accessories have also been crucial for the typical cult-brand image of Harley which not only creates visibility bu also increases overall sales volume of Harley.