They have developed a product and brand of superior value than that of many competitors, surpassing customer expectations. Harley Davidson’s products are classified as luxury products. To differentiate from competitors, Harley Davidson has implemented exceptional product quality, unique product features and high quality service. Harley Davidson has a narrow competitive scope; they focus on a limited product, the motorcycle. Many of Harley Davidson’s competitors have achieved product diversity and offer a wide range of products.
In major European markets, Ducati’s brand loyalty ranked among the highest in the motorcycle industry, with about 55% of its small customer - Continuing outsourced most of the production activities from 80% to 90%, mainly by a firm that is highly efficient - A platform approach to production. The motorcycle was divided into a relatively small number of components, which were in turn made of sub-components. - Distribution: in the past it distributed directly through multi-franchise retail dealers in Italy, and through a series of independent distributors. Then in 1997, it started a new distribution strategy which is unfolded in three phases, to improve the average quality of the dealers, including a creation of a chain of “Ducati stores” - R&D: increase effort in R&D, which took 3.7% of total revenue 2. What is the fundamental logic underlying its turnaround?
This had the several direct effects: a) The new market positioning expanded the size of the motorcycle market out of leisure and into affordable transportation, initially in an area where the U.S. and European motorcycles were less competitive in terms of product features and pricing. b) Honda valued market responsiveness as critical. Consequently, the company invested heavily in R&D, achieving a shortened conception-to-production cycle, and maintaining a “Cold Storage” of future designs at the ready. c) Design and product features supported the positioning and the sales volume: for example, a step through frame, one-handed controls, and an automatic transmission. d) Viewing unit costs as a curve inversely proportional to volume (the Experience Curve), the market philosophy drove down the curve faster.
SECTION A1. Discuss specific budgetary items that raise concern in the budget planning. The budgetary areas that raise concern in the budget planning are as follows, Concern #1: Revenue from Sales (income generated from sales) Competition Bikes, Inc. budgeted: $5,247,450 This seems too high based on the decreasing sales trend from Year 7 Net Sales of $5,980,000 to Year 8 Net Sales of only $5,083,000 (Horizontal Analysis) verses Year 9 budgeted Revenue from Sales of $5,247,450. Concern #2: Advertising (expense to run ads) Competition Bikes, Inc. budgeted: $28,412 This seems too high based on the decreasing trend from Year 7 Advertising of $32,760 to Year 8 Advertising of $27,428 (Horizontal Analysis) verses Year 9 budgeted Advertising
Or do they just naturally follow the systematic approach to following diversity? I have many more questions that I will address in this proposal and will eventually answer through careful research in my final audit. 3 Diversity In Johnson & Johnson Co. Johnson & Johnson is a company that takes pride in its diversity. Not only do they recognize the necessity for diversity, they take steps to assure that diversity is prominent in the business. Johnson & Johnson’s mission statement is “To embed diversity and inclusion into our business to drive innovation and growth ensuring we better serve patients, customers, employees, and our communities” [1].
As we introduced a new version of the popular motorcycle we see the younger crowd affected by what it represents. The older consumers are able to hold on to the older version or may purchase the newer one at a lower cost. But the younger consumer has the opportunity to purchase a motorcycle that is stylish, dependable and cost effective. Lifecycle The impact of the product life cycle on marketing is that economic conditions will force the marketing strategy to be reformulated a number of times during the products life cycle (Kotler and Keller 2006. p 335). In the simulation, the product life cycle impacted the product by the fact that the sales decreased which called for a makeover in the marketing plan.
The demand of these markets are a low cost bike which Harley will need to address if they want to succeed in these competitive markets, while there already exists a big presence of low cost competitors such as Honda, Suzuki and Yamaha as well as counterfeiters. In order to address this issue they face the risk of changing their brand image of quality with a large price tag which could have a snow ball effect in other markets demanding cheaper bikes as well. Another risk Harley faces is one which can be observed by a similar mistake Cadillac made in the past.
By making sure to keep focused on these selling points for the Harley-Davidson brand, they are sure to become a success in India. Marketing to Influence Emotions Using marketing to influence emotional aspects of the motorcycle buying process is something that’s crucial to the success of Harley-Davidson. One key way they’re doing so is by allowing consumers to come in and test drive any motorcycle they’d like. By being able to actually get onto the Harley and take a ride, the consumer feels the joy the Harley motorcycle can bring them as well as see features that they may want to add on, and maybe even in the process convince them of extra add-ons they hadn’t known about or thought they wanted that they enjoyed during the test ride and now want to add to their motorcycle. Also, by allowing consumers to test ride, the consumer is likely to come back from the test ride feeling happy from the enjoyable experience which a good mood means good things typically for the seller.
Identify Harley Davidson’s strategy and explain its rationale. Branding: They promote a special life-style and the brand image represented the fundamental American values: “Individuality, freedom and adventure”. The unique feature in Harley’s is their deep, rumbling sound for which they are renowned. Harley Davidson was selling a Harley experience which came at a heavy pricing. Central to their strategy was promoting the brand name and they did so well.
Plant Location Puzzle Introduction The case study involves a The Eldora Company (EDC), a bicycle manufacturer. EDC has prospered in the local marketplace but the industry on the whole is showing a low growth rate, i.e. the industry as of now is saturated. Large number of bicycle makers had moved their manufacturing operations overseas to take advantage of lower labor costs, EDC on the other hand had stuck with a domestic manufacturing strategy, keeping its plant on the same campus as its corporate offices in Boulder, Colorado. The company now faces competition from low cost manufacturers and a saturated marketplace.