Business Makeover: Harley-Davidson

Mike Schuster  Oct 27, 2008 2:05 pm

Business Makeover: Harley-Davidson
 
If it's broke, fix it.
 

 
Falling short of Wall Street's expectations, Harley-Davidson's (HOG) third-quarter earnings dropped 37% to $166.5 million (earnings totaled $265 million in the same period last year). Adding insult to injury, CEO Jim Ziemer said the future of the global economy will effectively work against his company.

With such a bleak outlook, how can Harley shift profits from first to fifth without stalling out?

 

For some, the Harley-Davidson brand still conjures dirty outlaws on the open road. Transform that tarnished image by releasing current data on the company's actual customer profile: Upper-middle class suburban white guys with a median age of 47.

The trademark growl of the V-twin engine -- said to resemble somebody saying "potato-potato" -- can be too raucous for more demure bikers. Modify the engine to produce a sound more similar to a British aristocrat's pronunciation of "potato-potato."

"Born to Be Wild" and "Highway to Hell" are played out as motorhead anthems. In the next advertising campaign, give "Ain't No Stoppin' Us Now" by McFadden and Whitehead a whirl.

From mugs to belt buckles to Christmas-tree ornaments, Harley merchandise has been spread much too thin to be profitable. Limit products to bikes, jackets and the all-important teddy bears in leather vests.

The late Evel Knievel's infamous, death-defying stunts, performed on his Harley-Davidson XR-750, are now a distant memory. Introduce a line of red-white-and-blue stunt bikes aimed at the lucrative daredevil market.

Product placement can be effective - but try to at least find a film better than Wild Hogs in which to feature your wares.

 

 

Rate this article:  (0 Votes)
Comments (6) See All Comments »
10-27-2008, 2:59 pm
You're serious, aren't you?

You recognized a picture of an engine as if it's a picture of your mother.

I'll leave you to think about the implications of that on your own.
Read More
10-27-2008, 4:52 pm
1 percent, old school - we dont need some candy a s s suit telling HD loyal customers to detune the bikes and make the co softer. Your cruisin for a brusin-wise up
Read More
10-28-2008, 1:14 pm
Harley is already catering to the youth market with new models like the Rocker and Crossbones. As for the engine I suspect that soon it will be gone as the current air cooled version will be muffled by EPA and be water cooled, thus the testbed Vrod c
Read More
10-28-2008, 6:36 pm
First read thought was another young inexperienced recent MBA grad offering an uniformed opinion.
Second read - found the humor - it's a joke guys and gals!!
He's jerking your chain.
Read More
10-29-2008, 2:44 pm
You are kidding about Wild Hogs. Best movie ever!!!
Read More
discuss this article and more on the mv exchange
No positions in stocks mentioned.

Get real-time options trading ideas from Steve Smith, veteran options trader and newsletter author, plus let him show you the way to cut risk and boost your returns through the strategic use of options.  Click here for a free 14 day trial to OptionSmith by Steve Smith.



The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.
Ticker Talk
Popular Tickers:
SPX »AMZN »F »
Select
  •  
Talk Now
Share this Talk on your site:
Send us your feedback

Our Professors

rss article alert