A couple of weeks ago, Harley Davidson released their first quarter financial results and, as usual, it makes for some interesting reading. Now, we’ve talked about profit centers in this column before, but what was really interesting isn’t that profits stayed virtually the same for H-D versus the first quarter last year, but that they actually shipped nearly 13,000 fewer bikes.
Do the math with me – 13,000 fewer bikes, the shuttering of Victory Motorcycles last fall, and troubled sales for many of the one-off builders.
Add those up and you get what I think might be an industry that is in trouble. Why?
Look at us! We’re getting older. Some of us are still shockingly good looking, but we’re older and despite deep pockets, the idea of tying up thousands of dollars in a weekend cruiser is one that more and more folks can’t stomach – at least not when that carries with it what amounts to a nice car payment.
Now, this isn’t about “how can we save the industry” but it is about why the industry seems to collectively forget about new riders.
It’s a marketing term called “cost of acquisition” and that means what it takes to turn an individual into a buyer.
It takes a lot of money. It takes an alignment with the buyer – their dreams, visions, goals, and lifestyle.
In short – there are a lot of young people that would rather drive a hybrid than a hog. Why? You name it – electric gadgetry, some sort of strange desire to be on the cutting edge of technology, the overall usefulness of the vehicle for their lives, and the inability of many young people to be able to work on the machines they own.
And one other thing that nobody will say – an identity crisis among young men. They are told that they have to share their feelings, any opinion contrary to theirs should be welcomed, and that having a belief structure that runs counter to popular culture is somehow wrong. Nobody wants to say it, but being masculine in this day and age carries with it negative stereotypes, no matter who you are.
Heck, in the U.S. Presidential campaign last year, a lot of these folks were simply called names – “a basket of deplorables” – and how has anyone been converted to the other side by being called names?
And when you have a bike – especially a big American-made V-Twin – you are making a statement, loud and clear, “I’m different.” Silly as it is to say, the stereotype for a biker is now one that represents a conservative point of view and guess what? Those aren’t fashionable right now.
The challenges that Harley faces – and the entire industry – is one of identity for the next generation. Getting new riders in the saddle and onto the sales purchase agreement is the only thing that is going to change the sales trends in North America and for all of us who love the sound of a V-Twin, our responsibility to this sport we love is to make sure that the next generation is ready to put on the chaps and boots and not slip into their skinny jeans with a Frappuccino.