Chapter 8
Harley-Davidson Wheels into India
Can Milwaukee-based Harley-Davidson
[http://bi.galegroup.com/essentials/company/47405?u=tlearn_trl] roar into India—the world’s
second-largest market for motorcycles, after China—and attract buyers despite strong competition
from local and global bike brands? With more than a century of tradition behind its iconic
American brand, Harley-Davidson isn’t starting from scratch in India. It enjoys high brand
recognition worldwide and began planning for a presence in India in 2005. Two years later, a
U.S.-India trade deal paved the way for foreign made, heavy-weight bikes like Harley-Davidson
to be imported and sold throughout the country. Once Harley-Davidson had the green light to go
into high gear, it began recruiting dealers in five metropolitan areas.
Marketers for Harley-Davidson see India’s economy growing rapidly. Its expanding middle
class has both considerable buying power and an appetite for world class, brand-name products.
Most of these consumers have seen Harley-Davidson bikes in Hollywood movies, and some have
met Harley-Davidson owners or tested Harley-Davidson bikes at cycling events. Harley-
Davidson’s research shows that affluent motorcycle enthusiasts tend to own more than one bike
(one for weekday commuting and another for weekend trips, for instance). “These are people who
have worked hard, earn well, and can now allow themselves the chance to explore their passions,”
explains the managing director.
Still, Harley-Davidson must compete against long established bike brands such as Royal
Enfield, which has its own loyal customer base. Consumers in India can compare Royal
Enfield’s four-stroke engines—responsible for the “thumper” sound associated with the brand—
with Harley-Davidson’s more powerful V-twin engines, which produce that brand’s signature
thundering sound. Looking at price, they will find Royal Enfield’s bikes carry a lower price tag
than Harley-Davidson’s, in part because of import duties. Consumers concerned about the
availability of repair services will also compare Harley-Davidson’s handful of dealerships with
Royal Enfield’s countrywide dealership network.
Harley-Davidson’s unique image of independence and individuality is a clear point of
differentiation. The company also has other competitive advantages. One is that it offers a full
range of motorcycles and accessories, with customization options that bike buyers particularly
value. The company is developing special customization kits so buyers in India can mix and
match Harley-Davidson engines and parts to create one-of-a-kind motorcycles, as they do in other
markets.
A second competitive advantage is that only Harley-Davidson buyers can join the Harley
Owners Group (HOG), a global group whose one million-plus members are invited to events
such as bike training “boot camp,” weekend rides, and film festivals exclusively for Harley–
Davidson owners. HOG members also get to attend the company’s owners-only rock concerts
featuring top Indian bands. “We want to give bike lovers the full ownership experience in India,”
Harley-Davidson’s managing director says about local HOG activities.
A third advantage is that Harley-Davidson dealerships permit buyers to test-drive every bike
in the product line, which not every competitor allows. Test-drives help buyers try out the
various features, experience firsthand the difference between individual models, and form an
impression of how it would feel to ride a Harley-Davidson bike.
Harley-Davidson is starting out strong in India. Before the first bike was delivered, the
company had hundreds of preorders. As in most of the world, the majority of buyers are men.
Unlike most Harley-Davidson markets, however, here the fastest growth in sales is to men in their
30s and 40s. Women are also being targeted, according to the director of marketing in India:
“While we strongly believe Harley-Davidson is more of a state of mind and it transcends gender
and age, we see a tremendous potential with Indian women riders.” In fact, Harley-Davidson is
already the most popular brand among U.S. women bike buyers, a trend that could spread to India
in the coming years.
i
CASE QUESTIONS
1. How is Harley-Davidson using marketing to influence emotional aspects of the motorcycle
buying process?
2. What role are consumer characteristics likely to play in a consumer’s decision to buy a
Harley-Davidson in India?
3. In terms of the anchoring and adjustment process, what challenges and opportunities does
Harley Davidson face in marketing to Indian consumers?
4. Using the consumer behavior concepts in this chapter, explain the marketing thinking behind
allowing buyers to test-drive any of the
5. Harley-Davidson bikes. Do you agree with this marketing decision? Why or why not? How
might consumers use thought-based decision models when considering a motorcycle purchase
in India? What are the implications for Harley-Davidson?
i