Ducati Case 16

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BACKGROUND OF THE STUDY: In the summer of 1996 Frederico Minoli was appointed as the CEO of Ducati in order to lead the company into a new era of profitability and to establish Ducati as a brand to contend with in the sports motorcycle segment. In the years preceding the revolutionary turnaround, the company changed hands a number of time which resulted in a lack of overall strategic direction. Ducati’s turnaround focused on brand building which was supported by the reconfiguration of a number of activities ranging from increased efficiency in the production process to broadening its customer base. Having almost doubled its market share in 2001, Minoli wanted to find new sources of growth. Among others he considered the cruiser market, currently dominated by Harley Davidson. His goal was to compete directly with Harley Davidson by introducing a cruiser that combined Ducati’s high performance engine with its own unique design. The purpose of this study is to identify the optimum decision about entering cruiser segment for Ducati’s future success. This study contains the industry analysis, an internal strategic analysis, company performance, and conclusion and recommendations A. INDUSTRY ANALYSIS: Although the number of motorcycle manufacturers has declined by a large number over the last century, competition exists among companies from different continents. Currently, all major manufacturers such Harley-Davidson, Honda, BMW, Triumph are from Japan, The U.S., and Europe. The motorcycle industry is segmented into four categories: off-road, cruisers, touring and sport bikes, each of them with different qualities and target customers. Exhibit: Category Qualities Target customer Largest player Off-road Bikes Upright ergonomics, Thickly padded seats, Soft shocks, Superior sturdiness KTM, BMW Cruisers Bikes Big sized, Upright riding position, Stylish

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