Harley Davidson Case Study

Author/Student: Jean-Daniel Roth
Professor: Dr. Susan Hughes-Isley, Ph.D
Harvard University, Harvard Extension School

Date: 2020, April 6

Reaching Millennials Through Product Innovation at Harley Davidson (2020)

About Harley Davidson

Harley Davidson is a US motorcycle manufacturer founded in Milwaukee, Wisconsin in 1903 by William S. Harley and the Davidson brothers. Harley Davidson motorcycles often enjoy a cult status in motorcycle circles. No other motorcycle embodies the American dream to the same extent as a Harley Davidson. This dream, however, has a price: The cheapest models cost around USD 6,000, while the more expensive models cost up to USD 50,000 and more, depending on the equipment. For many motorcyclists, mostly baby boomers, the brand conveys a strong sense of personal freedom. In addition to producing motorcycles and parts, Harley Davidson also markets a wide range of merchandising products.

Introduction and Problem Identification

In 2019, the US manufacturer sold as fewer motorcycles than it had in eight years. The losses were particularly large on the domestic market in the USA, where business has been poor for three years. But also the asian market slowed down the last few years. The record year of 2006, when Harley Davidson was able to sell 370 thousand motorcycles worldwide seems a long way off (Statista, 2019). Harley Davidson sees the problem mainly in the aging of their regular customers, the baby boomers, who ride less as they get older (Harvard Extension School, Case Study Harley Davidson).

In view of the sharp drop in sales figures, the management launched the „More Roads to Harley Davidson“ programme in 2018. With this strategy, the company aims to establish a new generation of customers worldwide in a short period of time and to stabilize the existing customer base. This ambitious programme includes further development of the Touring and Cruiser line, new high-performance custom models, a model offensive in the 250cc to 500cc category for the asian market and the creation of new product categories such as e-motorcycles and e-bicycles. With the ambitious plan to launch multiple product categories and models in different markets in a very short period of time, the company risks high R & D costs and failed developments due to missed market research. In addition, associated inefficiency in production can reduce the margins of the whole product line (Marshall & Johnston, 2019, p. 222). An example of an unsuccessful development is the „LiveWire“, the first e-bike from Harley Davidson. This model clearly failed to address the millennium market because of its premium price and was temporarily withdrawn from the market after technical difficulties (Singh, 2019).

Based on the current events surrounding „LiveWire“, this case examines which factors Harley Davidson should consider when implementing its planned model offensive in order to successfully gain market share in the millennium market. In order to pursue a practical approach, this question is examined in the context of the world’s largest motorcycle market: India (Exhibit 1).


The following pages examine the typical characteristics of millennials and their impact on the buying process (Marshall & Johnston, 2019, pp. 156 – 163). Character traits that are directly related to the Consumer Decision-Making Process are assigned to one of the five process steps (Exhibit 3). These insights form the basis for the alignment of the product line and the target group approach. In a second step, this paper evaluates the best approach to address the younger generation with new products, using a competitor analysis and a SWOT analysis. From these analyses, a proposal for a new marketing mix and concrete recommendations are derived (Marshall & Johnston, 2019, p. 11).

Characteristics of Millennials

Millennials are persons born between 1981 and 1996 (Pew Research Center, 2015). This generation is now between 25 and 40 years old. They have experienced 9/11, the stock market crash, and how their parents, despite a high level of loyalty, lost their job. Due to the global economic crisis, the career start of the older millennials was bumpy in the first decade of the new millennium. These circumstances have shaped this generation. Studies conclude that millennials tend to be dissatisfied with their lives. This is reflected in a subdued basic attitude towards their own economic future and a fundamental scepticism towards politicians and business representatives (Deloitte, 2019). This attitude is also a reaction to the rising cost of living in the developed industrial nations and increased pressure on the middle class, which has been shrinking since the financial crisis (Partington, 2017). But this is not the only reason why millennials have so far been able to accumulate less wealth in their working lives than previous generations over the same period (Pesque, 2019). One reason is probably also that millennials live in a world with a very large number of values and options. The resulting diversity of life choices overburdens many of them. As a result, this generation often experiences decision blockades, a psychological phenomenon known as „Decision Fatigue“ (Schwartz, 2004).

Millennials in India: The characteristics of millennials in India are in many ways similar to their Western counterparts, but there are also differences: Millennials in India are more positive about the future than in developed countries. But just as in western cultures, they also want to have a positive impact on society. Ambitions such as higher wages and home ownership are lower (Deloitte, 2019).

Effects on product preferences, evaluation and purchase processes: In the context of the climate crisis, their general loss of confidence in politicians and business leaders, and their often limited budgets, millennials are looking for sustainable and affordable products. Especially popular are new products from start ups, which communicate with them on social media. A product should combine emotional and functional needs and be manufactured by a company that takes the environment and people into account. Because they are careful with their money and don’t want to make any wrong decisions, they rely heavily on word-of-mouth propaganda and product review sites on the we when choosing a product. In their search for products, millennials use social media and the most popular search engines like Google. Online, the millennials are mostly on their smartphones, where they have their app-based communication tools such as WhatsApp and Instagram installed. When buying products, millennials like to be able to choose between different payment methods. They also prefer companies that don’t ask for too much personal information. They also need to be able to build trust that a company can handle and protect their data carefully. When it comes to deliveries, they value fast delivery times. For service requests, they appreciate it if a company offers variou online touchpoints such as Facebook, Instagram and chats where they can easily contact a company representative (Exhibits 2 and 3).

The Motorcycle Market in India

India is an attractive market for the Harley Davidson company, which has been operating in this market since 2009. This has several reasons. One reason is the current population of 1.38 billion and the predicted population development for the next decades. Projections assume that India will overtake China and will be the most populous country in the world in 10 years (Statista, 2019). Not only has the population grown steadily in recent years, but also GDP and per capita income (Our World in Data, 2020). The motorcycle industry has benefited from a positive economic development and has grown steadily in recent years. India is now the biggest motorcycle market in the world.

2018, however, sales in the industry began to collapse. The reasons for this slump are an economic slowdown in India, an increase in the price of motorcycle insurance and stricter emission standards. The downward trend continued in the following year. In 2019, 3.1 million fewer motorcycles were sold in India than in the previous year (McD, 2019).

The motorcycle manufacturers have now reacted to the slowdown with various packages of measures. In general, manufacturers are focusing on expanding their physical and digital distribution networks, on new or revised models, on cost optimization and innovation (Exhibit 4). Most of the manufacturers analysed have a broad product portfolio and are active in several of the following product categories: Cruiser, Commuter, Sports, Scooter and Off Road. Harley Davidson is unable to respond to rapid economic fluctuations due to its narrow and high-priced portfolio.

Growing Premium Segment

Despite economic slowdown, the premium segment was able to grow by 130% in 2019. One reason could be that these buyers were not affected by the macroeconomic conditions (Financial Express, 2019). The KTM and BMW brands, which focus on quality motorcycles in the 500cc – 800cc class, benefited most from this growth (Exhibit 5). The motorcycle industry in India has recognized the positive trend in the premium segment and is now producing increasingly larger motorcycles. Harley Davidson, which is also positioned in the premium segment, was unable to benefit from this trend. On the contrary, sales figures fell by 24% in 2019 (McD, 2019). This development could have the following reasons: When buying a motorcycle, price and image play a decisive role for millennials (Exhibit 1). In terms of price, the purchase of a Harley Davidson is comparable to the purchase of a car for this target group. In addition, younger riders perceive Harley Davidson models as oversized and outdated. The new generation of motorcyclists is therefore switching to cheaper, more modern brands that will allow them to enter the world of big motorcycles (Ell, 2018).

Example of a local producer entering the premium segment

As mentioned above, motorcycle manufacturers are beginning to move their portfolios into the premium segment. Harley Davidson, for example, is threatened by the traditional Indian brand Royal Enfield, which also focuses on motorcycles with a nostalgic factor. The Chennai-based company has successfully launched two new models in the 650cc class in 2018. Unlike Harley Davidson’s models, the overall appearance of the Royal Enfield brand is fresh and contemporary. The same applies to the inexpensive merchandising items, which are tailored to the millennials in India. With an attractive online presence including an e-shop and a motorbike configurator, the company has also created a contemporary digital experience for its young customers (Royal Enfield, 2020).

Strenghts Weaknesses
  • Worldwide Brand awareness
  • Values like freedom and individuality
  • Bikes are perceived as status symbols
  • High quality products
  • Good service
  • Worldwide guarantee
  • Strong know-how
  • Intellectual Property (IP), brand trademark, patents
  • Strong dealer community
  • Training programs for dealers
  • Presence on social media
  • Limited market reach, due to small distribution network
  • Brand perceived as outdated by younger generatio
  • Narrow product mix, no entry level in the segment under 250cc
  • Too expensive for young generations
  • Lack of technical innovation
  • Launch of first e-motorbike failed 2019
  • Outdated and unfocussed merchandising portfolio, slow loading times merchandising shop
Opportunities Threats
  • Attractive market size
  • Target market size:
  • Growing population
  • Increasing demand
  • Growing strength of the middle class
  • Ongoing urbanization
  • Congested roads in urban areas
  • Emerging market segment
  • e-motorbikes
  • Major presence in the digital economy
  • High social media usage (Statista, 2020)
  • High density of IT-Startups
  • New customers from online channels,
  • New technologies that allow a higher degree of automation
  • Changing consumer tastes
  • Budget and time restrictions for younger buyer groups
  • Substitutes of local competitors
  • Market entry of well-known premium brands partnering with local producers
  • Competitors entering the cruiser segment, copying
  • Similar growth strategy from other players on the market
  • Technological developments by competitors
  • Increased promotion by competitors
  • Growing strenghts of local competitors with wide portfolios
  • Tougher environmental regulations and laws

Conclusions SWOT Analysis: Like no other brand in the motorcycle industry, Harley Davidson stands for values such as freedom and individuality. Harley Davidson must now reinterpret these values to appeal to the younger generations. This is urgently needed because the millennials see the brand above all as a dusty status symbol that they cannot afford. However, there is not only an image problem, but also a problem of application for the product itself. Millennials, for example, do no have time to ride a Harley Davidson into the sunset on a lonely country road. Also, in an urbancontext, a garage is often missing to park the expensive, large motorcycle. A complicating factor for sales is that the service and warranty benefits cannot be played off in communication with the young target groups, as the main reason for not making a purchase decision is price. To attract young buyers, Harley Davidson would have to supplement its narrow portfolio with smaller entry-level models in a fresh design. With customizable and price-flexible starter models, the company could counteract the budget restrictions of the younger generations and thus win new customers. Product features of the new models, as well as the merchandising items, would have to be tailored to the new target groups. In addition, the manufacturer could expand its digital ecosystem in order to collect user data that could be used to develop future models. At the same time, the company would have to use an aggressive growth strategy to expand its sales and service network and modernize its e-commerce channels. The idea of simplified storefronts, which is being considered in the „More Roads to Harley Davidson“ program, is a step in the right direction. In view of the growing competition in the premium segment, it is important that this network now expands very quickly and is actively promoted locally on social media.


Harley Davidson could win the new generation of riders by creating a set of affordable and modern entry models. In addition to that, Harley Davidson should expand their dealer network and promote their new models on social media. Following marketing mix is recommended:


  • Developing new models together with the young target groups
  • Focussing on smaller, customizable and trendier motorcycle models
  • Creating value by adding modern product features such as a GPS tracking system against theft or an integrated charging device for smartphones
  • Creation of a few basic models, which can be expanded according to the client’s budget (mass-customization)
  • Creating an attractive digital experience: For example a digital motorcycle configurator or a personalizable app with emergency data, chat function and personal templates to upload branded selfies to social media channels
  • Partnering with local IT-Start Ups to develop compelling digital features (Failory.com, 2020)
  • Creating new, affordable and culturally adapted merchandising products


  • Adapting prices to millennials reality of life
  • Creating a flexible pricemodel


  • Expanding the dealer network rapidly
  • Simplify outlets
  • Improve E-Commerce


  • Using targeted social media ads-campaigns to push outlets and products


The traditional brand, which for decades has inspired the baby boomer generation, is making a big effort to inspire the new generation of buyers for its products. But it’s not working very well for the old giant of the motorbike industry. Sales figures continue to decline despite new models and modernization of their logo. Even though Harley Davidson tries hard to make the new models moremodern, fundamental problems remain: The machines are still big, heavy, loud and too expensive for the new target groups. Somehow Harley Davidson makes a lost impression in the midst of a smart, environmentally conscious and networked generation. The difficult start and the withdrawal of the first e-bike „LiveWire“ has shown two things: Product development is difficult and expensive and secondly, market research should not be neglected before developing a new production. This project started five years ago. It was a time when it was still difficult to estimate how financially strong the next generation would be. However,five years ago one could have known that Millennials, given their debts from student days, could not spend USD 30,000 on a motorcycle. Harley Davidson is now at risk of losing touch with the Millennial market if they do not immediately and very consistently respond to the needs of this generation. The market in India clearly shows that the battle for market share in the premium segment has begun. However, the premium segment in India and Asia in general is on a completely different price level. So what does that mean for Harley Davidson?

In order to gain market share in the millennial market, Harley Davidson should consistently address the needs of the younger generation in their planned model offensive in the 250cc to 500cc category. To ensure the profitability of the entire product line, the number of models should be kept small. By creating a few basic models, which can be expanded individually according to the customers‘ budgets, efficiency and consequently, the margin, can be guaranteed even at lower sales prices. With this customization-model Harley Davidson could create an entry point for millennials into the premium segment. As soon as a Harley is back within reach for the young target groups, the Harley Davidson warranty program becomes very attractive and can be used as a sales argument. However, the development of models tailored to the target group is not yet done.

There are further reasons why Harley Davidson should also develop its motorcycles strongly in terms of technology: adding value to their motorbikes, making them harder to copy and collecting data from customers. The technology that Harley Davidson uses actually is easy to reproduce. At a time when low-cost producers are evolving and starting to move into new segments, it’s vital that Harley Davidson incorporates new technologies and unique concepts into their new models. But as a traditional motorcycle manufacturer, it is difficult to compete against large companies like Honda, which are able to develop new technologies within the group and implement them in different product categories. For this reason, Harley Davidson needs young partners from the tech scene who can help them find the „killer features“ that will excite Millennials.

The „More Roads to Harley Davidson“ growth plan envisages a massive model offensive in various markets and in new product categories such as e-motorbikes and e-bikes. But the successful market activities of competitors in the Indian market show clearly how hard it is to secure market share in a competitive market. Harley Davidson’s model offensive should therefore be reduced to a few models, so that forces are released for the multiple tasks that are waiting for Harley Davidson: For example, the consistent expansion of sales and service points, the establishment of its own factories, the creation of an attractive digital user experience and launching of powerful marketing campaigns. This whole range of activities is associated with a major investment and therefore requires the company to focus.

Harley Davidson’s program recognizes the generational problems. However, their growth plan is not focussed enough and brings considerable investment risks for the entire company.


Ajmera, A., Vats, R. (2017). Royal Enfield’s big bike could test Harley’s India dominance. Reuters. Retrieved from https://www.reuters.com

Reuters is an international news agency which has its headquarters in London. In this news release the author reports about the launch of the first heavyweight motorcycle by the Indian manufacturer Royal Enfield. He states that Royal Enfield with his large distribution network will put Harley Davidson in trouble.

Brand Trust. (2018, November 21). How the Digital Transformation Shapes Luxury Brands. Retrieved from https://www.brand-trust.de/en/article/2018/summary-study-digital-luxury.php

This article states that digitization is changing the consumer behavior of new target groups. Millennials are seen as the future luxury buyers who will account for 40% of luxury sales in 2025. To reach these new customer groups, luxury brands must create unique customer experiences.

Brigham, T. (2020, July 2). Make it. I’ve been a ‚millennial therapist‘ for more than 5 years—and this is their No. 1 complaint. CNBC. Retrieved from https://www.cnbc.com/

Make it is a section on CNBC that is dedicated to business, money and career. Under the rubric Science of Success Tess Brigham, a psychotherapist from St. Francisco writes about her experiences with millennials. She states, that the majority of her millennial clients have trouble making decisions because of the many life options.

Case Study Harley Davidson. (2020). Management Decision Case: Developing and Growing Brand Equity in an Iconic Brand. Harvard Extension School.

Dettlin, L., & HSU, W. (2017, Oktober 27). International Monetary Fund. Playing Catch up. Retrieved from https://www.imf.org/external/pubs/ft/fandd/2017/06/dettling.htm

The International Monetary Fund (IMF) is an organization that was created in 1945. The IMF’s self-declared goal is to ensure the stability of the international monetary system. In this article the author states that millennials have been able to accumulate less wealth than previous generations of the same age.

Deloitte. (2019). Deloitte Millennial Survey 2019. Retrieved from file:///C:/Users/mycomm%20GmbH/Downloads/in-about-deloitte-millenial-survey-report-noexp%20(1).pdf

Deloitte is a multinational professional consulting firm headquarters in London. The report states, that millennials and generation Z are not very optimistic about their professional careers, their lives in general. The report 8th annual millennial survey shows, that millennias in India tend to be more confident about their future.

Ell, K. (2018, February 3). Harley-Davidson tries to regain its coolness factor. CNBC. Retrieved from https://www.cnbc.com

In this article the author mentions several reasons, why younger generations are not interested in motorcycles made by Harley Davidson. One reason which the article mentions is, that Harleys are too expensive for many people, specially for young generations. In addition to that the author states, that younger generations want smaller and cheaper motorcycles.

Harley Davidson. (n.d.). Motorclothes. Retrieved 2020, April 1 from https://motorclothes.harley-davidson.eu

Motorclothes is the official merchandise website of Harley Davidson. The online shop offers mainly branded jackets, pants, T-shirts, gloves and helmets. The online shop also documents the history of Motorclothes with a historical timeline.

Ipsos. (2016). The Millennial Influence. Retrieved from https://www.ipsos.com/sites/default/files/2017-05/vocalink-the-millennial-influence-europe.pdf

Ipsos SA is an internationally active market research company with headquarters in France. This study has been commissioned by Vocalink, a Mastercard company. This Research is about how millennials use new technology and about their in financial attitudes and behaviours.

KTM. Company website. Retrieved 2020, April 4  from https://www.ktm.com/in/

The official website of the motorcycle brand KTM. KTM, short for „Kronreif Trunkenpolz Mattighofen“, is a European motorcycle brand which was founded 1934 in Mattighofen, Austria. In India KMT motorcycles are built in partnership with the indian company Bajaj. Recently the company started to target the premium motorcycle segment in India.

Marshall, G. W., & Johnston, M. W. (2019). Marketing management (3rd ed.). New York, NY: McGraw-Hill Education.

McD, MotorCycles Data. World Motorcycles Market. In the 2019 sales down 1.6 million units. Retrieved 2020, April 2 from https://motorcyclesdata.com/2020/02/28/world-motorcycles-market/

Motorcycles Data is is a Consulting firm specialized in the motorcycle industry. MotoCycles Data is tracking over 600 brands, 33 000 models and over 80 markets. This article provides information on global market trends and developments in the largest motorcycle markets in the world.

McD, MotorCycles Data. India. First Quarter 2020 sales down 20% with the full year projected below the 15 million. Retrieved 2020, April 2 from https://motorcyclesdata.com/2020/04/01/indian-motorcycles-market/

This article is about the two wheeler market in India. It describes motorcycle trends and the market outlook for 2020. It also contains a summary of the 2019 sales figures of the largest motorcycle manufacturers.

Our World in Data. GDP per capita. Retrieved 2020, April 4 from https://ourworldindata.org

This platform is an effort between researchers at the University of Oxford and the non-profit organization Global Change Data Lab. The platform focusses on topics around poverty, diseases, climate change and other problems. The goal of this platform is to make progress against the world’s largest problems by making them accessible and understandable.

Partington, R. (2019, April 10), millennials being squeezed out of middle class, says OECD. The Guardian. Retrieved from https://www.theguardian.com/business/2019/

The Guardian is a daily newspaper from Great Britain. In this article the author talks about a report from the Organisation for Economic Co-operation and Development (OEDC), which found out, that the middle class in 40 developed countries is shrinking.

Pew Research Center. (2015, September 3). The Whys and Hows of Generations Research. Retrieved from https://www.people-press.org/2015/09/03/the-whys-and-hows-of-generations-research/

Pew Research Center is offering information about attitudes and trends shaping America and the world. This article is about the different generations, for instance where they start and when they end and which factors are associated with generational differences.

Singh, R. K., (2019, Oktober 7). Harley struggles to fire up new generation of riders with electric bike debut. Reuters. Retrieved from https://www.reuters.com/article/us-harley-davidson-electricbike-focus

In this article the author states that the younger generation is not buying the new e-motorcyle from Harley Davidson. As a main reason he mentions the premium price of almost USD 30 000. In addition to that he thinks, that the market for this type of motorcycle does not exist.

Singh, R. K., (2019, Oktober 14). Harley-Davidson halts electric motorcycle production. Reuters. Retrieved from https://www.reuters.com/article/us-harley-electric

Harley Davidson has stopped production and deliveries of their new e-motorbike after encountering technical issues. The article mentions Harley Davidson dealers who stated that the bulk of order came from old, existing riders and not from young customers.

Pritish, R. (2019, April 14). Riding high: Luxury bikes find a booming market in India. Financial Express. Retrieved from https://www.financialexpress.com/industry/vroom-vroom-how-Millennials-changing-the-pace-of-high-end-bikes-in-india/1547403/

The Financial Express ia a business newspaper. In this article the author states, that the segment of luxury bikes is increasing. He supports his claim with data from the Society of Indian Automobile Association (SIAM).

Schwartz, B. (2004). The Paradox of Choice: Why More is Less (1st ed.). New York, USA: HarperCollins.

In this book, the author describes at which point choice can become a burden. He comes to the conclusion that too much choice leads to unrealistically high expectations and a blockade in the decision making process. This phenoenon can also be observed in millennials, which have plenty of life options.

Statista. (2019). Transportation. Vehicles & Road Traffic. Harley-Davidson’s worldwide motorcycle retail sales in FY 2017 and FY 2019, by country or region. Retrieved from https://www.statista.com/statistics/252220/worldwide-motorcycle-retail-sales-of-harley-davidson/

Statista is a platform for statistics from Germany. These statistics show impressively how Harley Davidson sales figures have fallen worldwide between 2017 and 2019. The losses on the domestic market in the US were particularly large.

Statista. (2020). Facebook usage penetration in India from 2015 to 2018 with a forecast until 2023. Retrievd from  https://www.statista.com/statistics/553725/facebook-penetration-in-india/

According to Statista, 25% of the population in India currently use social media. It is expected that the social networking site’s penetration will increase to over 30% by 2023. Given the growing population, India’s total population is estimated to be around 1.42 billion by 2023.

Statista. (2019). Die zehn Länder mit der jeweils größten Bevölkerung in den Jahren 1950, 2000 und 2020 sowie Prognosen für 2030, 2050 und 2100. [The ten countries with the largest populations in 1950, 2000 and 2020 and forecasts for 2030, 2050 and 2100]. Retrieved from https://de.statista.com/statistik/daten/studie/157531/umfrage/laender-mit-der-hoechsten-bevoelkerungszahl/

This statistics show largest populations in 1950 and 2000 and the corresponding forecasts for 2020, 2030, 2050 and 2100. It is predicted that India will become the most populous country in the world within ten years.

ZAK. When Products become Brands. Selfhood. [Video]. Retrieved 2020, March 20 from https://www.youtube.com/watch?v=1fFe5bJ804E

Brands need to understand the customers, because customers under 30 years old, want to connect with brands and they want to feel validated. They feel especially recognized when companies enter into a dialogue with them on social media.

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