Cult branding: The Harley-Davidson story
I could have used the phrase 'customer satisfaction' in this article had I been talking about any other brand. But I have refrained from doing so for fear of making ridiculous understatements. After all, we're talking about the legendary brand of Harley-Davidson Motorcycles.
It takes a powerful brand to repeatedly draw customers to a product or service. It takes a Harley-Davidson-like (there is no other word for it) brand to make customers tattoo the company logo on their biceps.
H-D has gone past merely 'satisfying' its customers and has instilled in them a loyalty that borders on fanaticism. How the company went about doing that is a story worth re-telling.
Started in 1903, Harley-Davidson motorcycles were used in local races and later, by the American military in the two World Wars. The company was one of only two American motorcycle makers to survive the Great Depression. Over the decades that followed, Harleys became a symbol of machismo thanks to their heavy frames and the sheer power delivered by their roaring engines. But then, the Japs arrived. Honda, Yamaha and Kawasaki with their superior manufacturing techniques and quality control began dominating the market. To make things worse, Harley-Davidson was plagued by a takeover, downsizing of the workforce and resulting labour strikes. The quality of the bikes reduced to the extent of earning nicknames like 'Hardly Ableson' and 'Hogly Ferguson'. Needless to say, sales plummeted and the company was pushed to the verge of bankruptcy.
Then in 1981, few former executives of the company bought the company over, borrowing loans totalling to $80 million. They faced the huge task of putting the company back on its feet, and their efforts led to the revival of what is now an iconic brand.
In a parody of sorts, Total Quality Management techniques were conceived by Americans, but learnt and incorporated extensively by the Japanese before the American industries did. So H-D had to 'learn' these from the Japs and this was the first step towards creating a motorcycle that was worth the hefty price-tag. In addition, lobbying at Washington helped raise the import tariff on Japanese motorcycles from 4% to 40% temporarily, giving H-D a small window of opportunity to get back on its feet. From this point, it was up to the marketers.
With an acute budget constraint, H-D's marketers could not afford conventional branding campaigns. At the heart of their strategy was the idea of selling not just bikes, but the 'Harley Experience'. They wished to create a community of buyers who did not own just a pr
oduct, but belonged to the Harley way of life – freedom, empowerment, individualism. Their target buyers were those who, regardless of socio-economic background or age-group, would yearn to experience this by strapping on some leather and going for a long ride on an open road.
The 'Harley Owners Group' or H.O.G. was an idea which spawned from this strategy.
The H.O.G. was created to strengthen relationships between customers, dealers and employees and also create an attraction for potential buyers. The company sponsored rallies and gatherings wherein Harley owners could participate, share experiences and people could try the bikes out. These popular events strengthened the community, gave the owners a sense of belonging and became effective means of promotion. The company also used campaigns like SuperRide in 1983, where people were invited to test drive the bikes and about 40,000 prospective customers accepted the invitation. The feedback received from such events were used to design newer models and soon, they began selling customized motorcycles. This added an element of individuality into every bike.
Harley-Davidson also offered its customers benefits like insurance, emergency road-side service, rental arrangements at vacation spots, membership in riding groups, motorcycle magazine subscriptions and many more. With a strong customer base which showed an undying loyalty, the company could diversify into accessories such as wallets, helmets, leather jackets, a clothing line, even a Visa card.
The success of H-D can be attributed primarily to the strong relationships that the company decided to build with its customers, offering them more than just a bike. Interestingly, this simple objective has enabled Harley-Davidson to take its brand beyond simple 'success' and turn it into a Cult Brand. If numbers are needed as evidence, then fancy this – the H.O.G. had around 73000 members in 1987. Today, this figure stands at about 450000 worldwide.
While reading this article, you might have intuitively linked Harley-Davidson's strategy to textbook terms like 'guerilla marketing' and 'experiential marketing'. If you're wondering why I haven't used any of these, it is simply because these terms had not even been coined back then. This story holds classic examples of both, but the important takeaway is this – what a creative mind can conjure up can very well surpass what books can teach.