Harley-Davidson Strategic Analysis Case Study

Harley-Davidson Strategic Analysis Case Study

For more than a century, Harley-Davidson has been leading in the global motorcycle market. The partnership between Arthur Davidson and Bill Harley in 1903 saw the creation of the Harley-Davidson brand. The brand is widely known for both its famous shield trademark and famous bars that are based on the Milwaukee. It is a publicly traded company and mainly deals with financial services and motorcycles & related products.  Although Harley Davidson Company is mainly concentrated in the European market, there are ongoing efforts to venture in the Asian market.  It is imperative to mention that, five years after founding the company, the two business partners had managed to manufacture more than 150 units.

Over the years, the sales have improved with the brand recording more than 200, 000 annual sales in the USA. Additionally, there has been the creation of more than 1, 300 dealership contracts in the globe. The brand has a holding of 28% in the USA motorcycle market making it the leading motorcycle brand in the USA.  The mission statement of Harley Davidson Company is to fulfill many dreams that are inspired roads as well as offer products that prove unique experiences to the customers. Through its innovative product development processes, the company strives to fuel the passion of its customers

The motorcycle market can be defined as being consolidated and records intense competition from global motorcycle brands. Some of the major brands in the industry include Honda and Suzuki. These players have a large pool of marketing and financial resources that allow them to maintain a dominant position.  Harley Davidson Company offers bikes got leisure, sport and long distance. The entry of other motorcycle brands had prompted the management to come up with a comprehensive supply chain strategy that ensures that the company has significant market shares across the globe. It is worth noting that the operations of Harley Davidson Company can be divided into financing and the motorcycle section.

Under the motorcycle section, it offers different scopes of motorcycles, spare parts and other products. On the other hand, the financing options offer the needed financial incentives required by wholesalers and retailers to propel the operations of Harley Davidson Company.  The finance section further offers insurance covers to the customers. Other than the USA, the Harley Davidson Company has active operations in Asia, Europe and North America. While the company was faced by a financial crisis in 2008 that prompted closure of some plants, it has since resumed active operations across the globe. Currently, there has been a significant development in the luxury division which accounts for a huge portion of the company’s revenues.

Internal Environment Analysis: SWOT Analysis

  1. Strengths
  • The company has in the past years had improved market performances. Harley-Davidson has a well-trained and experienced team that allows for market penetration, launching new products and dealing with the threat of other brands.
  • Harley-Davidson past records indicate that its customers have high satisfaction levels which can be linked to both the quality brand and the HOG initiative. The company has a customer dedicated relationships that ensure their needs are addressed swiftly.
  • The company has a strong dealer community that is spread in different parts of the globe. The dealers serve to move the Harley-Davidson brand into overseas and also serve as the contact between the customers and the company.
  • Over the years, the company has managed to create a strong brand portfolio. The strong brand plays an important role in entering new markets as well as marketing new motorcycles.
  • Additionally, Harley-Davidson has been successful in creating an effective distribution network. The management has invested in a sustainable distribution model that ensures that there is a consideration of the social, environmental and economic objectives.
  1. Weaknesses
  • Despite the strong brand image, it is critical to note that Harley-Davidson has limited success beyond its core businesses. The company can be defined as lagging behind in conforming to the ongoing market trends.
  • The organizational structure is also not compatible with the ongoing market trends that stress on improved integration at a global level.
  • There are also significant gaps in the motorcycle ranges that are offered by Harley-Davidson. The lack of other motorcycle choices within the Harley-Davidson brand may prompt the customers to turn to other brands.
  • Although Harley-Davidson has active groups, it is imperative to point out that turn has a limited online presence. Under the current setting, there is an emphasis on the creation of internet platforms where the customers can order and pay for their goods.
  1. Opportunities
  • The low inflation rates and the continued economic growth in the USA and other foreign markets imply that there are high prospects of an improvement in the consumption levels. Economic growth in these markets will further increase the demand for luxury motorcycles.
  • The adoption of merging technologies serve as a way that the brand can counter the threat of other players, reduce the operational costs as well as streamline its operational processes. Additionally, such technology can be adopted in product development and other core business operations.
  • Through the creation of sustainable distribution networks, there are the increased chances of lowering the operational cost thus leading to an equal reduction in the price of the Harley-Davidson without affecting the profit levels.
  1. Threats
  • There are varying liability claims in different countries thus implying that the Harley-Davidson is exposed to many liabilities that may have the effect of lowering the profit levels.
  • There is also a sharp growth in local distributors and brands. The intense competition creates the risk that the organization may lose its market to other rival brands.
  • Past operations indicate that the company does not have a regular supply of innovative products. The situation is unlike other brands which are seen as coming up with innovative products at regular intervals.
  • Under the current setting, the company is operating in many countries thus increasing the level of risk to currency fluctuations. On the other hand, political instability in these countries can significantly lower the competitive advantage of the company.
  • The demand for luxury products is seasonal and also sensitive to economic disruptions. The situation is compounded by the fact that the core products of Harley-Davidson are luxury motorcycles.




External Market Analysis: PESTEL Analysis

  1. Political Factors

Although the core of the Harley-Davidson operations is in the USA, it has active operation in other countries in Asia, North America and Europe. In the case of the USA, the country has stable political structures that offer the needed support services to businesses operations. However some countries in North America and Asia are unstable and register regular conflicts thus disrupting business operations. The political structures are further charged with the role of shaping foreign policies and trade regulations. They may either favor or derail the operations of Harley-Davidson. Contrary to the early settings, the company has operations in many countries thus increasing the risk of being derailed by political instability.

  1. Economic Factors

Economic factors impacts on both the consumption and the investment trends. During economic downturns, there is often the risk that the level of sales and investment will reduce. A progressive economy means that the Harley-Davidson management will have greater access to resources that are required in the expansion of the business. On the other hand, economic factors concerns themselves with taxation and trade regulations. The success of the Harley-Davidson is thus based on the ability to conform to the differing economic regimes across the globe. Lastly, a disruption in the levels of income will cause a significant decline in the spending levels.

  1. Social Factors

Focusing on the European market indicates that most of the customers are educated and have improved access to information relating to other brands. A high education level implies that the customers are keen on the products they buy and will likely settle for brands that offer full value for their money. It holds that Harley-Davidson Company must offer competitive offers such as quality and affordable motorcycles. Likewise, many societies are becoming diverse due to the high level of globalization and integration. The demographic changes require the company to be in a position to address the needs of all persons.

  1. Technological Factors

A look at many businesses indicates that they are keen on adopting new technologies in both product development and marketing activities. The shift can be linked to the need to reduce the operational costs as well as ensure that there is the smooth functioning of all operations. An example is the use of online platforms as way of allowing the customers to order and pay for their goods via the internet. Likewise, the USA government has put in place many measures that ensures that are improved communication structures and other support services. However, this is not the case with other overseas markets as there are inadequate support services.

  1. Legal Factors

The USA government takes keen interest in business with the objective of protecting the customers, investors and ensuring that there are no negative impacts on the environment. There is a growing emphasis on ensuring that businesses do not endanger in activities that lead to the pollution of the environment. The operations of the Harley-Davidson Company must be in compliance with these regulations. Other than the environmental laws, there are other regulations that covers the rights of the employees and the customers. In the case of the employees, they seek to ensure that there is no exploitation of the employees in term of racial discrimination or disparities in the pay levels. It is critical to point out that these regulations may complicate the execution of different processes as well as increase the operational costs.


Marketing Strategies used by Harley Davidson Company

Harley Davidson Company serves as one of the leading global motorcycle brands and has huge markets in Asia, Europe, Africa and North America.  The Harley Owners Group serves as the backbone of the marketing strategies. The platform allows owners and motorcycle enthusiast to share their experiences and other useful insights. Through rallies, social events and rides, the HOG has managed to create a useful network for the Harley Davidson Company.  The initiative has increased the market awareness level of the brand and as successful countered the threat created by rival brands.

Harley Davidson Company also depends on the Rider’s Edge initiative which was created in 2000. For over a decade, it has been played a central role in providing basic training to customers thus minimizing accidents, loss of life and damages to the bikes. Other than improving the safety of the riders, the initiative has proved to be an effective marketing tool. Prior to the rolling out of these initiatives, the company had sought to acquire other local brands such as Buell Monocles. Mergers and acquisition are critical in improving the competitive advantage and cutting down on the operational costs.  Purchasing interest in other companies has in the past allowed the company to access new markets and distribution systems.

The marketing activities are further based on a stress of the unique features of the brand as compared to other motorcycle. The Harley Davidson brand is often associated with quality and durability. Moreover, the company has an extensive product portfolio that meets the needed of the diverse customers. Rather than generalizing its marketing activities, their efforts to ensure that there are custom products that meet the trends in each market. An example is the fact that the motorcycles offered in the European market are different from those offered in the Asian markets. Addition, the customers have the choice of sport, luxury or long distance bikes.

That notwithstanding, the group has many dealers that are located in different parts of the groups. The dealers serve as the point of contact between the Harley Davidson Company and the customers. They serve the role of bridging the gap in the market and ensure that new products are communicated to the customers. Other than selling monocles, they sell spare parts and offer mechanic services to the customers. The many dealers contributes to the market mix employed by the company as they ensure that there are improved satisfaction levels among the customers. It further saves the Harley Davidson Company the cost of creating distribution and communication networks in overseas markets.

Additionally, the strategy helps deal with the problem of limited mobility. The large size of plants that are required to support the production of monocles implies that the ability to create new plants on regular basis is greatly curtailed. However, sustainable distribution networks and the active role of dealers has allowed for the bridging of this gap. On the other hand, there are similar efforts to have increased online platforms where the customers can access details relating to the company and its products via virtual platforms. Focusing on many organizations indicates that there is the tendency to adopt online platforms as being one of the ways of reducing the operational costs as well as improving the market presence levels.




Catulli, M., Cook, M., & Potter, S. (2017). Product service systems users and Harley Davidson riders: The importance of consumer identity in the diffusion of sustainable consumption solutions. Journal of Industrial Ecology, 21(5), 1370-1379.

Farris, P. W., & Gregg, E. A. (2017). Harley-Davidson: Building a Brand Through Consumer Engagement. Darden Business Publishing Cases, 1-10.

Grant, R. (2018). Harley Davidson: creating experience from strategy. The Business & Management Collection.

Paschen, J., Pitt, L., Kietzmann, J., Dabirian, A., & Farshid, M. (2017). The brand personalities of brand communities: an analysis of online communication. Online Information Review, 41(7), 1064-1075.

Roese, N. J., & Kompella, M. (2017). Harley-Davidson: Chasing a new generation of customers. Kellogg School of Management Cases, 1-12.

Van Miegham, J., & Allon, G. (2008). Operations strategy. Dynamic Ideas: Belmont, MA, USA.