Case Analysis: Harley- Davidson Inc.
This case study analyzes the differentiation strategy adopted by Harley-Davidson Inc. to differentiate itself from the competition. Further, it will address the issues and challenges faced by Harley- Davidson Inc. due to changing demographics and financial turmoil. And last but not least the case study will give an idea of what strategies Harley- Davidson Inc. could apply in the future so that it could sustain and enhance its competitive position.
There are two generic business level strategies to yield a higher rate of profit over a rival according to M. Porter. First, a firm can focus on cost leadership, which generates economic value by having lower costs than competitors. Second, a firm can focus on product differentiation and generates economic value by offering a product that customers prefer over the products of competitors. In other words the firm provides something unique that is valuable to buyers beyond offering the product at a low price.
Harley-Davidson Inc. does not focus on cost leadership, but on product differentiation. Its tangible dimensions of differentiation are among other things its classic style that had characterized Harleys since its early years, the ability to personalize the motorcycle according to one's taste, the super-heavyweight cruiser bikes it sells and the wide price range. Moreover, H.D. offers a wide pre- and after- sales service that obliges dealers to carry a full line of Harley replacement parts and accessories and to perform service on Harley bikes, it offers test ride facilities, rider instruction classes, motorcycle rental, assistance for owners in customizing their bikes through dealer-based design centers and chrome consultants, insurance services and exclusive dealerships.
Its intangible dimensions of differentiation are its unique image, status, exclusivity and identity. Thus, H.D does incorporate the American lifestyle, stands for individuality, freedom,...
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