Harley-Davidson: History, Marketing & SWOT Analysis


History of the Company

Harley-Davidson, the iconic American company manufactures traditional cruiser motorbikes powered by air-cooled V-Twin engines, was founded in 1903 by William S. Harley and brothers Arthur and Walter Davidson in a small township in Milwaukee, Wisconsin (J&P Cycles 1). The Harley-Davidson brand is so entrenched in the American culture that its history is intertwined with that of modern America itself. In 1907, the company was incorporated, with William Davidson officially joining hands with his brothers and Harley. The bikes were manufactured using the corporation’s signature 45-degree air-cooled V-Twin. In a decade, the company had become the premier manufacturer of motorcycles in America. The company’s brand also experienced a significant boost when the American military sourced Harley motorcycles for its men during the First World War. This close association was also evident during the Second World War when the US Army used Harley-Davidson bikes in Europe and the Far East.

Over the years, the organization has endured several ownership changes, periods of economic instabilities, customer abandonment due to poor product quality, and competition from foreign manufacturers. However, it still retains its title as the premier manufacturer for cruiser motorbikes and, as such, has a dedicated following. After WWII, the company embarked on producing new designs, which included the Sportster. Unveiled in 1957, the Sportster is the oldest model in the H-D production (J&P Cycles 1). In the 1960s, H-D experienced ownership changes when it went public in 1965 and merged with American Machine and Foundry (AMF) in 1969 (J&P Cycles 1). However, economic instability saw AMF vend its share back to H-D. In the 1980s and 1990s, the company introduced model families such as the FLT, Softail, and Road King that it produces to this day (J&P Cycles 1). This expansion helped Harley-Davidson to retain its crown as an American icon. It also acquired speed enthusiasts by introducing high performance-oriented models such as the V-Rod. As the riding population ages, the company has shifted to the younger market by releasing edgier makeovers of its definitive models.

Marketing Analysis

Segmentation, Targeting, and Positioning

Harley-Davidson employs a psychographic segmentation to accommodate the ever-changing consumer needs as it is primarily a lifestyle brand. Many motorbike enthusiasts choose Harley-Davidson over other manufacturers since its products offer value for money. Its unique and innovative design has helped the company become a global success. To overcome competition, Harley Davidson uses a differentiated targeting strategy whereby it targets different market segments using unique market mixes. Notably, it has bikes for individuals aged between 25 and 34 with an average income of $75,000. Its secondary target is the middle-aged population with an average income of $78,000 (Agnihotri 293). Harley Davidson has a strong positioning in the mind of its consumers as a premium motorcycle company known for its advanced application of technology and design. It has achieved its positioning by offering products with unique customization.

Competitive Advantage

An extensive brand product portfolio ranging from the Harley Street aimed at entry-level buyers to touring and cruiser bikes meant for wealthy riders has helped the company increase its sales. Also, its high-end products have enhanced the premium brand image in the market. Further, customization and accessories are the crucial competitive advantage of the company. Consumers fancy their Harleys and various customizations are available from the hand and the stand and with the fittings a driver can wear. Harley Davidson has fashioned a rich riding culture through the HOG (Harley Owners Group), which conducts regular events where Harley bike owners from different regions meet and share ideas. Recently, H-D has shifted to upcoming and developing markets to reduce its dependence on the US market that appears to have matured and is on the wane.

Distribution Strategy

Harley Davidson distributes its products using their independent showrooms and dealerships allocated worldwide. Its premium dealerships are mainly supported by HDFS to allow it to run activities efficiently and to reduce operational costs. Its non-traditional outlets such as Alternate retail outlets (ARO) and Seasonal retail outlets (SRO) are central to the company’s strategy to penetrate new markets. The showrooms act as extensions of the main dealerships.

SWOT Analysis


Harley-Davidson has made itself a cult brand, positioning itself in the niche segment of high CC cruiser bikes. The company has a high customer pull owing to its unique promotional strategies and branding that has helped H-D to create a strong base, thus increasing its TOMA score (Top of mind awareness score). With its differentiated product range, the company can meet the needs of different consumers. For instance, the Street 500CC & 750 CC are designed for young buyers who are conscious of fuel economy (Bhasin 1). Harley Davidson’s impeccable image of quality and freedom that has enabled the corporation to craft a niche position in the market. Owing to a rich heritage and financial stability backed by Harley Davidson Merchandising, the company is always on a growing path.


The corporation has only one manufacturing unit in India and an assembling plant in Brazil. As a result, it struggles to reach markets such as Asia and Africa. Furthermore, the company is overly dependent on the U.S. market. Notably, over 60% of Harley Davidson’s revenue comes from the U.S. (Forbes 1). Even though this market is stable, it is risky as it has already matured and, as such, does not experience sustainable sales growth. Lastly, the company relies on single/limited supplies, which could affect its business operations in the long run. Specifically, in case of an increase in input cost, the operational cost would rise, affecting the cost of motorcycles. Such may lead to capacity constraints, lower production, customer dissatisfaction, and financial challenges among suppliers due to a decline in demand for inputs.


The demand for Harley Davidson products in the Asian and European markets is increasing. Crucially, only a few manufacturers there compete in their segment. Such has created a lucrative opportunity for H-D to exploit the markets aggressively. With a set of loyal cult followers, H-D can attract younger customers by launching low-end heavyweight bikes. Furthermore, with the increased number of women and young riders, Harley-Davidson could allocate marketing resources towards attracting this prospective base by associating its products with an outlaw lifestyle. Notably, women purchase about 15,000 bikes per year and this number anticipated to increase yearly (Bhasin 1). H-D can target this group to grow its sales.


Harley-Davidson’s myopic market approach could affect the brand adversely. Most of its sales are in the U.S., demonstrating the company’s focus on maintaining customers and not getting new ones. With companies such as Indian Motorcycles and Vector Motorcycles venturing in the heavyweight segment and offering lower prices, the overall business performance of Harley might be in jeopardy.

Marketing Mix

The marketing mix will provide the set of actions or tactics that Harley-Davidson uses to promote its brand in the market using the 4Ps – price, product, promotion, and place.


Since its formation, Harley-Davidson has produced premium-quality motorcycle models consistently. Its primary focus has been heavily-built bikes with strong engines that offer both power and a thumping sound trademark. Also, its design constitutes another of its trademark, whereby bikes are customized according to the needs of the biker. Since the motorcycles come in multiple designs, consumers have numerous options to select. All Harley Davidson’s products are spirited and, most significantly, unique to the H-D brand.

The bikes that Harley-Davidson produces are referred to as “mean machines” and are a source of admiration. They entice millions to exclusively benchmark offerings against the shapes and designs of H-D bikes. Furthermore, Harley-Davidson is iconic owing to its highway cruising bikes that are known for long stretch rides. Buoyed by a good road network and a spirit of adventure, thousands of enthusiasts attend annual tours in Harley bikes. Heavy and high displacement engines have been an indistinguishable feature of Harley Davidson bikes. They are known for being reliable and hardy. Conclusively, the company offers clients an assortment of models to choose from. Apart from dealing with engines and accessories that can be traded cheaply, the bikes are exceptionally customizable. In fact, there are open options for customers and prospects.


Since the company ventures mainly in heavily built chassis and high displacement engines, it cannot afford to compromise on quality. Its customers are also highly knowledgeable of mortars and expect a high-quality product. First-rate quality enables Harley-Davidson to sell its motorbikes at a premium price. However, owing to this pricing approach, the organization experiences severe swings in profitability as most people simply cut back on buying luxury items such as Harley bikes during recessions. In the past, the company has overcome these setbacks through rightsizing and layoffs. Even though the company could benefit from venturing into cheap bikes, it has stuck to its pricing. The impact is that Harley Davidson has exceptional positioning when it comes to brands of premium bikes.


A suitable place is anywhere a customer is located. This motto is used by successful business strategist and market analysts. At Harley Davidson, the maxim is well utilized and followed. Owing to extensive exposure the company has achieved through marketing campaigns, the H-D has outstanding brand equity which has resulted in massive demand for its products. Also, with the rise in the buying power of customers in markets such as India and Brazil, the company has established global operations. Harley Davidson has been exporting bikes and spares to most parts of the world for over a long period. However, its pricing has been affected by high taxation and heavy customs duties. As a result, only ardent Harley enthusiasts are willing to pay the prohibitive price of H-Ds. However, the company has made crucial policy changes in production policies. Currently, the company has two units outside the US. India represents the Asian market and Brazil covers distributions in Latin America.


The promotion function has been strategically designed and carefully executed by Harley-Davidson, allowing the company to maintain its class. The corporation does its adverts in an exceptionally subtle manner by sensibly placing their bikes in TV series and movies and associating them with masculinity and rebelliousness. The company also sponsors rallies, bike ride tours, and cross country marathon through the introduction of HOG culture. Crucially, the latter has attracted new customers and promoted loyalty among the existing ones. Apart from these promotional practices, the corporation organizes sales fares, which promote substantial discounts when the sales are low. The company has also been conducting lucky draws and coupons for discount services, free spare parts, and maintenance services, making its promotional function innovative and unique. Owing to a strong portfolio, the company does not believe in oversimplification and only advertises itself in the top-of-the-line magazines, media print vehicles, and hoardings. Over the years, Harley Davidson has centered its image on values such as friendship, strength, and freedom. The company encourages its consumers to take to the road and enjoy their rides to fulfill their heart desires. Such sentimental elements allow Harley-Davidson to easily dominate the market

PESTLE Analysis

Political Factors

Harley-Davidson benefits from political factors such as free trade agreements, increasing support for e-commerce, and improved inter-governmental support for patent protection. However, free trade agreements have threatened their sales by encouraging the entry of cheaper bikes from manufacturers such as Honda and Yamaha. On the contrary, increasing support for e-commerce creates opportunities for the company to advertise its product through online media.

Economic Factors

Economic factors relevant to Harley-Davidson Corporation include economic stability of its main markets, economic growth of developing countries, and stable access to credits. For instance, the economic stability of the main markets allows the corporation to expand its business in core areas, particularly the US. In addition, the company has the opportunity to expand rapidly in high-growth developing countries where demand for chopper bikes might increase. However, access to credits could be an advantage to competitors who want to establish retail outlets across the US market.

Social Factors

Social factors such as increased attitude for leisure, a rise in the number of women bikers, and changing attitudes about green technology have affected Harley-Davidson. The company includes social issues in a long-term strategy based on the macro-environment. For instance, an increased attitude for leisure presents an opportunity to sell motorcycles for such purposes. Also, the rising number of women riding motorbikes presents a good market opportunity for the company. However, the augmenting need for green technology is a threat to the company owing to high emissions from its old engines.

Technological factors

Harley-Davidson is in a prime position to customize its products to integrate green technologies, thus boosting the company’s performance. The corporation is now producing bikes that have a low green-technology rating. Furthermore, the company can increase its research and development investments to develop aspects of its products as the main selling point.

Environmental Factors

Currently, environmental trends expose the company’s poor sustainability. Harley-Davidson can solve this issue through transformations in its operations for enhanced sustainability ratings. However, climate change can reduce the attractive potential of its products which tend to have average emission ratings. Nevertheless, the corporation can improve the fuel efficiency of its motorcycles to entice environmentally conscious consumers.

Legal Factors

Crucial legal factors such as emission regulations, environment protection laws, and loopholes in global patent laws must be addressed by H-D. The company has an opportunity to satisfy emission regulation requirements, thus enabling it to sell bikes in highly regulated markets such as Europe. It can enhance its sustainability policies as well as contribute to environmentalist programs. Loopholes in patent laws threaten the company as the protection against imitation is weak.

Works Cited

Agnihotri, Arpita. “Turnaround Of Harley Davidson – Cult Brand Or Strategic Fit Approach?”. Taylor & Francis, 2019, https://doi.org/10.1080/0965254X.2013.768689. Accessed 30 Sept 2019.

Bhasin, Hitesh. “Marketing Strategy of Harley Davidson – Harley Davidson Strategy”. Marketing91, 2017, https://www.marketing91.com/marketing-strategy-of-harley-davidson/. Accessed 30 Sept 2019.

Forbes. “Harley-Davidson Works To Reverse The Declining Sales Trend In The Home Market”. Forbes.Com, 2019, https://www.forbes.com/sites/greatspeculations/2017/02/07/harley-davidson-works-to-reverse-the-declining-sales-trend-in-the-home-market/#4abbd1d46a89.

J&P Cycles. “Harley-Davidson History”. Jpcycles.Com, 2019, https://www.jpcycles.com/countersteer/moto-101/harley-davidson-motorcycle-history. Accessed 30 Sept 2019.

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