Case Study for Harley-Davidson

Currently H-D is the leading seller of heavy weight motorcycles across the entire world. Because they are at the pinnacle they are the target for the competition. Some of Harley Davidson 's advantages are name recognition, brand loyalty, brand quality and customer loyalty (Hitt, Ireland & Hoskisson, 2013, p. 81). The company benefits by having “the made in America” image attached to its products. The image of a Harley rider and owner is one of a tough, independent, free spirit, ready and willing to take on the world type of man. The sound of a H-D motorcycle in idle or being ridden is unique and very identifiable.

Both potential and existing competitors influence average industry profitability. The threat of new entrants is usually based on the market entry barriers. They can take diverse forms and are used to prevent an influx of firms into an industry whenever profits, adjusted for the cost of capital, rise above zero. In contrast, entry barriers exist whenever it is difficult or not economically feasible for an outsider to replicate the incumbents’ position (Porter, 1980b; Sanderson, 1998) The most common forms of entry barriers, except intrinsic physical or legal obstacles, are as follows:

Threat of new entrants: Intensified price competition as new entrants sought their share of mature market had negative effect. However, high capital requirements positively affect Ford Motor Company. High capital was allocated for research and development which was and advantage against new entrants.

The rivalry among competing sellers, often the strongest competitive pressure, is also fairly high for Panera in the restaurant industry. No switching costs, numerous competitors, and an increase in the availability of healthy food

Harley-Davidson treats the dealers not only as partners, but also as customers. Harley has developed a very effective marketing strategy, but it is the responsibility of manufacturing to produce high quality and reliable motorcycles.

The three statics of Harley-Davidson’s is; revenue, growth rate, and number of units that are sold. The manufacturer of the United States heavyweight motorcycle division has obtained, arrested, and achieved approximately fifty-four percent of the broad United States motorcycle exchange. Harley-Davidson has fifty-two percent share of the broad motorcycle exchange in which IBISWorld INC. has estimated that it will generate six point nine billion dollars in revenue this year, (Forbes, (2014).

As for South America, Harley-Davidson Inc. HOG +0.31% opened a permanent Latin America headquarters, joining a growing list of U.S. companies looking to tap into the emerging market. (By Melodie Warner in Market Watch) South America has a growing economy and a huge acceptance for an icon in the motorcycle industry like Harley Davidson. In the same way Japan embraced Harley “Their economy is a fast growing luxury market” p.c11.

Harley Davidson Company has a long history of building motorcycles that have worked to actually shape a part of the American culture. Its product positioning and marketing strategies have served as a prime example for any company to imitate. Harley Davidson has developed immense levels of brand loyalty over the years. However, the company has also been burdened by the recent economic downturn and now is going through something of a rebuilding phase as it tries to determine its best course forward. This analysis will conduct a SWOT assessment of Harley Davidson's current position and make recommendations on how Harley can continue to develop the next phase of its iconic American brand.

Porter 's five forces framework assesses the competitive pressures a company faces within the industry. The five forces of competitive pressure include: competition from rival sellers, competition from potential new entrants to the industry, competition from producers of substitute products, supplier bargaining power and customer bargaining power. The model helps us determine the strength of competitive pressures and profitability of an industry. [3]

One weakness they have is the high prices of their models when compared to their Japanese counterparts. It seems that they could increase their market share if they could produce a less expensive model without compromising the quality of the model. A major strength they have is their name recognition and the activities available for Harley owners to interact with each other. Groups such as the Harley Owner’s Group (HOG), and the Buell Riders Adventures Group (BRAG) often sponsor rallies for their members.

Historically Harley-Davidson to be a Niche Marketer, which is they had focused in on one particular aspect of the market. Kotler and Keller identified the following characteristics of niche marketing; customers have a distinct set of needs, they are willing to pay more to the firm that best suits their needs, it is not likely to attract competitors, gains economies through specialized products and it has a size, profit and to grow. Almost all of these hold true for the “heavyweight” segment of motor cycles that Harley-Davidson produced.

Harley-Davidson has managed to dominate the U.S. market by investing in research and development, experimenting with its designs and

The strength of Harley Davidson can be seen in its logo and product brand. In the United States, the Harley Davidson is like a cult since it has so many followers, as depicted in the case study whereby in all the rallies, hard core fans of the company, for example the Harley Owners Group was present. This gives the company a competitive advantage since it has a market that is readily available and willing to purchase its products no matter the cost. The other strength of the company as seen in the case study was in the protection by the government since it was a United States company. This helped Harley to recover when the company placed an increase on the tariffs charged on the

Michael Porter, an authority on competitive strategy, mentions five forces that the stronger each of these forces is, the more companies are limited in their ability to raise prices and earn greater profit. In carefully scanning it industry, the corporation must assess the importance to its success of each of the five forces. Now, we will analyses these five forces in the inner-city paint corporation. The first one is threat of new entrants which means newcomers to an existing industry. The new entrants typically bring new capacity, if the company wanted to resist the threat of new entrants. They must build an entry barrier which is an obstruction that makes it difficult for a

Milwaukee is where it all started for Harley Davidson. In 1903, William Harley Walter and Arthur Davidson created the first of millions Harley Davidson. It was one of the two major motorcycles that were able to survive the great depression. Since 1977, the only motorcycles sold to the public under the Harley-Davidson brand have been heavyweight motorcycles, with engine displacements greater than 700 cc, designed for cruising on highways. It is one of the most well known brands in the world of motorcycles and otherwise as well. Harley-Davidson maintains an enormous brand community, which keeps active through clubs, events, and a museum. The worth of Harley Davidson brand and its logo was somewhere around $40 million which was 0.8% of the