The Harley Davidson brand has an obvious and incredible strength. How many other brands can boast global die-hard levels of devotion, a tribe of brand ambassadors, global recognition, and clear differentiation against brand peers? So prized is the Harley logo that it has been tattooed on more body parts than there are bike parts. Meanwhile, Harley associated merchandise has been cultivated into a billion dollar industry.
Yet despite all this, cracks are quickly beginning to appear in the Harley brand. Motorcycle sales generally have been down 21.3 percent, and in the US (home to their biggest market) net income in general is down by 84.1 percent from the same period a year earlier. The company's net income for the third quarter of 2009 was US$26.5 million, compared to US$155.5 million for that same period in 2008. Obviously a reflection of the GFC and the broader economic malaise; but this is still a significant hit.
What has become increasingly apparent over the last few years is that the brand's key audience is firmly rooted in the Baby Boomer demographic. Baby boomers overwhelmingly make up the majority of Harley riders. In fact, the average Harley rider is now 45 (up from 37 where it was a decade ago), and 20% of all Harley riders are over 55.
So What of Younger Riders...
Clearly then the brand has reveled in tremendous success over the past fifteen years, but it has yet to gain a foothold in the generation sitting underneath the boomers: the Gen X demographic (35 - 45 year olds) as well as the female market. To do this, they will need to develop ways to broaden and contemporize the brand.
While this presents quite a challenge, there are even longer term benefits of expanding the brand into the more aspirational index of the even younger Gen Y's. Whilst it is not a brand this audience segment might consider today, by engaging now, it means they will have it in their radar, so that in twenty years owning a Harley Davidson and belonging to the tribe may become a reality...
Importantly we're not suggesting for one moment that Harley cut and run from their existing mainstay audience; this is akin to financial suicide. However there is something to be said for future proofing the brand, so it remains credible, engaging and relevant to future generations of riders.
Staying True and Evolving - At The Same Time
So the real question that confronts Harley Davidson is how to evolve its brand to become credible, relevant, differentiated, and sustainable against the next generation of Harley Davidson riders, whilst still maintaining its current tribe of older devotees. The answer lies in evolving and re-interpreting their current brand values.
We would suggest starting with the values of "classic" and reinterpreting this in a way that's beyond nostalgia, and places classic in a contemporary sense. This could involve contemporizing characteristics within classic, such as authenticity and legendary and, contextualizing them away from the past exclusively.
Harley Davidson could also learn from the marketing concept of consumer tribes. This could involve a paradigm shift from brand management to tribe management. It might involve asking who is the potential Harley Davidson tribe amongst today's 35 - 45 year olds? Perhaps Harley can figure out what this tribe needs, and go about producing experiences, services and products that can be delivered to them.
The additional activity Harley Davidson must engage in is re-connecting with its existing user base and even more importantly its dealerships; both these stakeholders will be critical to engaging with a younger audience. This kind of refocus for the brand could include 'aspirational' brand activation events, product placement in movies, or via a new product line that sustains traditional Harley values and attributes. These activities would all be designed to take the brand forward through innovation, making it less reliant on a vintage aesthetic that draws it back to the past.
Examples From Others...
Like many epic brands, Harley's greatest strength (in this case deep engagement with the current generation of baby boomers) is also its greatest weakness. How do they expand beyond a mentality of "my dad and granddad's brand - not mine"? Levis' had a similar challenge by the end of the 1980s. Largely on the back of their iconic 501 campaigns they were able to leverage classic music with a very hip brand ambassador and in turn found a whole new generation of denim wearers.
A more recent example of a world renowned brand facing a similar challenge might be Rolex's Tudor brand. Faced with a similar challenge of taking a heritage brand and presenting it aspirationally to a younger audience, they too have used music as a channel of communication. The clip below from their most recent marketing campaign features a 30 something looking actor (judging at least by his wrist), with a classic song pulled from the 1970s. The clip, resonating with heritage aspiration and youth, is instantly likeable and begs to be shared with friends.
Ultimately, the steadfast Harley riding baby boomers will continue to proudly buy and ride their motorcycles for a long while yet. At the moment the Harley brand has ample power and appeal within its core audience. But we still argue for reasons of long term sustainability the brand needs to move at least a generation younger. Doing this will require a mindset change within the team at Harley Davidson, and a clearer focus and conviction on the future and what's required to remain relevant in the longer term.