Harley-Davidson fights changing market with appeals to blacks, Hispanics

By James B. Kelleher
Reuters
(March 15, 2006) Harley-Davidson Inc., the U.S. motorcycle maker, insists it isn't nervous. But analysts and others who watch the company say it's in the middle of a coming-of-age drama that might be called "Uneasy Rider."

As the Baby Boomers who transformed Harley's rumbling, lumbering bikes from countercultural totems into American icons enter their senior years -- the leading edge of the generation is turning 60 this year -- they're increasingly in the market for knee and hip replacements, not Harley's notoriously bone-shaking bikes.

That's forcing the Milwaukee, Wisconsin-based company to scramble to find new customers among women, blacks and Hispanics -- groups that have not been

The quest has involved the development and rollout of new products, like the 883 Sportster Low, built for smaller, lighter riders, and new marketing efforts, like Harley's TV ad campaign during the NCAA tournament this spring.

But as Harley-Davidson tries to adapt to the changing marketplace, analysts say it needs to avoid the pitfalls that other Baby Boomer-favored businesses like Levi Strauss & Co. have fallen into as they tried to navigate a similar transformation.

"How do they do it without hurting existing customers and destroying the brand?" says Geoff Meredith, the president of Lifestage Matrix Marketing, a California consulting group that specializes in aging baby boomers and has worked with Levi's. "That's the $64 million question."

"Half their demand is from guys 40 to 50 years old," says Bob Simonson, an analyst for William Blair & Company in Chicago.

Joanne Bischmann, vice president of marketing at Harley, admits, "The demographics are changing" though she insists the change isn't as dramatic as some have suggested. "But that doesn't mean there aren't other populations we don't want to tap into."

To reach out to the black community, Harley has begun sponsoring the nationally syndicated show of Tom Joyner, an African American radio host whose program is heard by as many as 8 million U.S. listeners. Harley is also advertising during the nationally televised college basketball tournament that dominates the U.S. sports calendar from mid-March to early April and is sponsoring the Roundup, an African American version of the annual gathering of bikers in Sturgis, South Dakota.

To reach younger Hispanics, the company is advertising in Hombre and Fuego -- two Latino men's magazines -- and participating in low-rider shows.

And to reach women, it's putting a four-page insert into Jane, Allure, Glamour and two other Conde Nast magazines, featuring what Bischmann says are "real women riders." It's also hosting garage parties for women -- not unlike the get-togethers that Tupperware, Avon, Mary Kay and other U.S. direct marketers have used to target women successfully for decades.

At a recent event that drew hundreds of African American riders from the greater Chicago area to a club in the city's downtown Loop, the opportunities -- and challenges -- Harley-Davidson faces as it tries to change attitudes and win over new riders were on display.

Among the attendees were the 11 members of Ladyz on Krome, an all-female club of Harley-Davidson riders that Wingo -- who goes by the nom de zoom "Kuiet Storm" -- heads.

But the vast majority of the riders at the event, including Max "PT" Brown, a 32-year-old member of the 5th Gear Ridaz, another Chicago club, were owners of screaming street bikes like the Kawasaki Ninja.

Brown called Harley's "awesome bikes" but added. "the younger riders don't go for them. As you get older, then that's when you go into the Harley-Davidsons."

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