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Posts Tagged ‘Mark-Hans Richer’

HD Stock ChartI missed this a few days ago, but imagine that the first quarter results at Harley-Davidson were like eating a bag of those Krinkle Cut™ Salt & Pepper chips… a great taste with a satisfying crunch!

Yeah, I have a weakness for the hyper-engineered, overly marketed, addiction-creating potato chips.  But, I’ve digressed.

Q1’14 Financials:  Harley-Davidson reported its first-quarter 2014 retail sales in the U.S. were not as high as expected — in large part because of the brutal winter season that gripped the eastern two-thirds of the country and the absence of the Road Glide models.  Still, sales increased 3 percent in the first quarter of 2014 and the motor company maintained a 56 percent market share in the U.S.

On April 22, Harley reported it sold 57,415 motorcycles worldwide in the first quarter of 2014, a 5.8 percent increase over the same quarter last year. The increase helped boost the company’s total revenue by 10 percent, with earnings up 22 percent.  Most of that growth came from international sales as dealers sold 21,685 motorcycles, an increase of 10.9 percent compared with the first quarter of 2013. Sales in the U.S. increased by 3 percent over the same period last year.

The company had net income of $265.9 million, or $1.21 a share, for the quarter which was up from net income of $224.1 million, or 99 cents a share, in first quarter 2013.  Harley-Davidson said it expects to ship between 279,000 and 284,000 motorcycles in 2014, which would be an increase of between 7 and 9 percent from 2013.  It was noted in the financial call that the absence of the Road Glide models continues to impact the company’s bottom line which in the first quarter of 2013, sales of the Road Glides represented 10 percent of its sales.

Keith Wandell, Harley-Davidson’s CEO, chairman and president, said in a press release that “Our dealers had a solid quarter of retail motorcycle sales.”  He went on to say, “Sales in the Asia Pacific region were up strongly, and we are encouraged by the continued growth of new Harley-Davidson motorcycle sales in Europe. We’re also excited to be entering the heart of the retail selling season in the U.S., having achieved first-quarter retail growth of 3.0% in the midst of a long, cold winter.

After the earnings report was released, the company stock (HOG) went from $68 per share at close to establishing a new 52-week high of $71.99 per share.

Then there was some additional investment buzz from stock analyst’s and then with impeccable timing on April 29th, Mr. Wandell sold 45,308 shares of the company’s stock.  The stock was sold at an average price of $73.45, for a total value over $3.3 million.  The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available at this link.

But wait, there’s more…

HBO Films

HBO Films

Loan Payback:  H-D announced that it paid off the $303 million, high-interest rate loan from Warren Buffett’s, Berkshire Hathaway Inc. during the quarter, funds that were used for Harley’s financing company.

You might recall that during the stock market crash of 2008, Harley’s finance subsidiary was unable to loan money to customers because the capital markets had shut down and liquidity was running low.  You may have read the book or watched the “Too Big To Fail” television drama film on HBO?  The money/loan helped Harley-Davidson continue financing motorcycles through its financing company, but the loan came with a hefty 15 percent interest rate.  It was a bridge that H-D desperately needed and Berkshire Hathaway was the only company from which Harley could borrow money without giving up its equity.

Harley-Davidson-Softail-Breakout-2013FXSB Recall:  The only dark cloud in all this good news hoopla was the motorcycle recall on 2013-14 FXSB and FXSBSE models manufactured from March 20, 2012, through March 10, 2014, to identify and fix a problem with the fuel level sensor signal.  The NHTSA Campaign Number is 14V185000 and effects approximately 9,100 motorcycles.

It turns out that suspension variances may affect the gas tank mounting angle, causing the fuel level sensor to read inaccurately. “The gauge inaccuracy may cause the motorcycle to run out of fuel unexpectedly, possibly even before the Low Fuel Warning lamp illuminates,” the recall stated. This would cause the motorcycle to stall, increasing the risk of a crash.  Harley-Davidson will notify owners, and dealers will update the software to recalibrate the fuel level sensor signal, free of charge.

Sometimes it’s hard to rise above in our country, because the haters are lined up to tear you down.  But, I want to say congrats to Harley-Davidson!  I’ve got a mental image that the senior leadership team is doing celebratory high-fives, along with a Wandell victory dance or a watching Mark-Hans Richer air-guitar somersault on the board room table.

Photo’s courtesy of Google Finance, H-D and HBO Films.

All Rights Reserved © Northwest Harley Blog

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Gold top 10 winnerIt’s that time of year when folks are getting ready to ring in the New Year and its customary to provide a Top 10 list.

I decided to pull together a nostalgic list of some of the more ridiculous Harley-Davidson executive quotes.  There are some doozies and it makes a person wonder if they were cocktail chatter or actually written down and prepped by the PR team.  Honestly, it was difficult to narrow it down to just ten, but here they are: 

  1. “I would be really upset if you felt our strategy was about “meeting the nicest people on a Harley” because I can tell you that ain’t the strategy…” Harley CMO Mark-Hans Richer (Source: HERE)
  2. “These new bikes are leaner, yet still have a mean streak – they’re the real deal, made of real steel.” Harley CMO Mark-Hans Richer (Source: HERE)
  3. Little did we know we were doing a cross-promotion with God.” Harley CMO Mark-Hans Richer (Source: HERE)
  4. “‘Come Together’ is not merely a song in our [advert] spot – it’s an anthem for our relationship with our fans.” Harley CMO Mark-Hans Richer (Source: HERE)
  5. “We don’t do trend bikes, or fashion-statement motorcycles. We try to make something that will last forever.” **Brian Nelson, lead stylist on Project RUSHMORE  (Source: HERE)
  6. “I couldn’t care less if I ever wore a tie again.” Harley Chairman of the Board, president and CEO Keith Wandell  (Source: HERE)
  7. “None of us get up every morning and want to make people’s lives miserable and see people lose their jobs. If you think that’s the case, I apologize.”  Harley Chairman of the Board, president and CEO Keith Wandell  (Source: HERE)
  8. “We can’t survive on our core customers alone.” Harley Chairman of the Board, president and CEO Keith Wandell (Source: HERE)
  9. “The safety of our customers is our highest priority,” Harley General Manager of Motorcycle New Product Delivery Tony Wilcox (Source: HERE)
  10. “We think it’s a dichotomy” Harley Chairman of the Board, president and CEO Keith Wandell (Source: HERE)

There it is.  Do you have any memorable quotes to add to the list?

**Note: Mr. Nelson (#5) is not a company executive.

Photo courtesy of Sam Churchill.

All Rights Reserved © Northwest Harley Blog

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2014 Electra Glide Ultra Limited

2014 Electra Glide Ultra Limited

“New? New is easy. Right is hard.” – Craig Federighi, Apple Sr. VP of Software Engineering.

Fresh back from the 110th  Anniversary celebration, where I spent some time on the factory floor, trying to get some spy photos and probing a number of the workers to talk about what’s behind that so-called RUSHMORE name.  Was it real or another marketing slogan by “Mr. Pontiac” himself… Mark-Hans Richer?

Cut away - 103 cu.in. Liquid-cooled Cylinder Heads

Cut away – 103 cu.in. Liquid-cooled Cylinder Heads and Radiator Fan

It turns out that Project Rushmore is a nod to the famous monument that also happens to be near the mother of all motorcycle rallies, Sturgis.

Basically it’s an overarching theme for Harley-Davidson’s internal quest to build a better motorcycle. And while the motor company always stated they took customer feedback and tried to make improvements, even the most casual observer could see that Harley-Davidson’s pace of innovation has been off.  Compounding the dribbles of innovation are two motorcycle trends that have been working against the motor company; the continuing rise of competition, most notably Indian/Victory, and the fall of prices that consumers are willing to pay for a premium motorcycle.

When the “great recession” hit, Harley was arrogant complacent with those easy customer conquests/sales that were financed by home equity and they missed how customers views were changing on premium motorcycles.  It was from this business duress that Harley-Davidson reworked internal processes and procedures while at the same time being forced to become a leaner organization that could work more efficiently at engineering and developing motorcycles.

CAUTION: Blogger about to enter the H-D factory floor...

CAUTION: Blogger about to enter the H-D factory floor…

Layoffs, renegotiated union contracts, temp labor, threats to shut down manufacturing sites, no more music on the factory floor, etc.,… the bad news seemed endless coming from the Milwaukee HQ.

But, the 110 year old company moved forward and internally the Project RUSHMORE name became a rallying cry and served two product goals;  quicker development time (rush) and deeper features (more).   After analyzing and reviewing  successful product development organizations across numerous industries, Harley-Davidson re-worked their engineering, marketing, styling, manufacturing, and supply chain management strategy, and successfully reduced their product development timeline from 5+ years down to just over 3 years.

Clearly the H-D executives, at best, passed off some illusory innovation prior to the 2014 model year!

However, today Project RUSHMORE is real and the results are tangible for motorcycle enthusiasts.  It’s focused on four key areas — Control, Feel, Style, and Infotainment.  The 2014 touring models received significant refinements to shortcomings that the owners have lamented about for years.  The tangible results are that H-D has encapsulated over 100 new features and incorporated over 2,400 new part numbers.  From more aerodynamic fairings and easier-to-use saddlebags to the availability of two Twin-Cooled engines that incorporate precision liquid-cooled cylinder heads.  

After seeing, sitting on and riding the new 2014 touring models it’s easy to state they have a lot to offer and props to H-D for rolling out tangible enhancements beyond the typical new paint scheme.

Photos courtesy of H-D.  Engine cut-away photo taken by author on Milwaukee factory tour.

All Rights Reserved © Northwest Harley Blog

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Another year of cupcakes and candles is an acute reminder that I’m just an aging blogger.

And, there are some readers out there who actually believe I fly on the Harley-Davidson corporate jet, that Mark-Hans Richer (CMO) writes me a personal check every month for the magical posts I throw down about the motor company and that the kind words about Keith Wandell (CEO) were because he sent me a case of chrome Road Glide parts to fence on the black market.

I am in the middle of a blacked-out billet phase on the Road Glide with no chrome parts for sale, but the point is about aging and obsolescence.

For example, I was watching the Jeff Lynne (Electric Light Orchestra (ELO)) documentary on Palladia a couple weeks back.  I’d like to recommend that you watch it, but it’s just not that good so don’t waste your time.  But if you were under the age of twenty and watched this documentary you’d think Jeff Lynne was the most skilled rock star of the seventies.  It’s just not true. But there was a moment early on, when they played Jeff’s first single with the Idle Race… when they dropped the needle on the 45 and…

You’ve got to know, turntables did not become the rage until the very late sixties, in some cases the seventies. Audiophiles might have had an AR or a Thorens, or if you really had some money you’d purchase a Duals, but before that… there were only record players.  The tone-arms were about as sleek as a Ford F-350 truck. Heavy, and they were rarely automatic.  In fact, you’d often need to tape a dime on top to ensure they did not skip.

But what brought me back in time was that little arm, the little piece of plastic on the side… It was the lever you used to flip the needle from 33 to 45. And when you thought the music was getting a bit distorted, a bit scratchy, you’d go to your local electronics shop, which was just like an auto parts store, but with more dust, and you’d hold the needle in front of the guy behind the counter and he’d go back and retrieve a new one.  It came encased in a tiny plastic jewel box, sitting on a piece of foam rubber.  You’d go back home, pop it in, and listen once again through that all-in-one unit with the single speaker.

This was the way it was done. It was a routine and as familiar as dialing a rotary phone. But, it’s been lost to the sands of time.  It’s one thing to look at pictures on the internet of stuff that happened long before you were born. It’s quite another to be jolted into a past that you were extremely familiar with which has completely disappeared.

Things change and technology accelerates the pace.

We heard for a decade that digital photography was going to kill film and that Kodak wasn’t prepared.  Yet it seemed to never happen, then almost overnight everyone had a digital camera and Kodak filed for bankruptcy. Just because the future isn’t here yet it doesn’t mean it’s not coming.

Is Harley-Davidson the Kodak of the future?  They believe they’re in the memories and shared experience business when they really produce motorcycles!

Tell me which H-D touring model has a highly advanced semi-active suspension system which is capable of automatically adapting calibration to the type of path, asphalt and riding style the rider adopted?  Do any H-D cruisers have a multi-map ride-by-wire accelerator, traction control adjustable to multiple levels with multi-channel ABS (which can both be disengaged)?  What key features were developed from all the years of racing experience and applied to the product?  Are touring V-twin engines a jewel of technology and capable of producing power and torque above the closest competition?

It’s like they’re standing on ceremony, waiting for the past to return when nothing of the sort is ever going to happen.

It’s my viewpoint that the motor company needs to better COMMUNICATE the changes being considered for future products.  A product roadmap if you will.  We hear a lot about manufacturing optimization process changes, but when you put the bottom line first, you head straight towards obsolescence.

Harley-Davidson needs to get in the river and swim alongside its audience.  For example; I know a half dozen riders who have purchased 2-3 H-D motorcycles each over the past 10 years.  Not once has the motor company contacted these riders requesting feedback or soliciting ideas for product improvements.  Why?  If you want to be relevant in the future, you’ve got to innovate and lead.  When you get the motorcycle public embracing your plans, people will do your marketing if they believe in your product.

Here are a few ideas that H-D should consider:

  1. Provide more access to H-D experts/employees along with technical information via social media.
  2. Provide more do-it-yourself customization and/or how-to maintenance info; webcasts H-D TV or on a H-D Education Channel.
  3. Sponsor an educational program such as a “Tech Tuesday” video chat with experts to help consumers get more familiar with the technology and motorcycle culture.
  4. Invite independent bloggers to cover pre-launch and launch activity.  Provide bloggers similar access granted to the trade magazines to the factory. We understand press embargoes and know the drill.
  5. Provide bloggers limited access to your corporate sponsored dealer events.

You stay relevant by continuing to play. By taking chances. Innovating. Once you rely on your greatest hits, you’re toast.

Photo courtesy of H-D and Adalgisa Lira Santos

All Rights Reserved © Northwest Harley Blog

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2012 Interbrand Top 100 — Harley-Davidson #96

Maybe it was the Willie G. retirement?   Or it could have been a result of Mark Hans Richer (H-D CMO) flexing marketing muscles on the urban scene.

It might be that after nearly three years of downsizing, plant closures and restructuring its business, Harley-Davidson is firing on both cylinders and there is a lot less heat buildup due to the “synthetic lube” of Keith Wandell’s (H-D CEO) new break-in procedure?  Whatever the case, it has emerged with an improvement in brand value.

This according to Interbrand who recently released the 2012 Best Global Brands.  In 2010, the H-D brand was 100 on the top 100 list.  In 2011 it improved to 98th and for this year it again improved its ranking to 96th.

How does Interbrand choose which brands it considers best?

The research firm uses three factors: 1) the financial performance of the branded product or service; 2) the role the brand plays in influencing consumers; and 3) the strength of the brand in asking a premium price for its products or bringing in earnings for the company.

“Stereo Typical” Harley Ad

The restructure strategies seems to be paying off with signs of solid performance and consistent growth. Sure there are significant “head winds”…  meaning challenging economic times and the motor company knows that it cannot solely rely on baby boomers, and needs to appeal to women, minorities, Gen Y, and Millennials.

HERE is an example of that new outreach (#stereotypicalharley).  Or the remix version HERE.

The management at Harley-Davidson want customers to “feel a certain way” when using their products, visiting a dealer, or surfing on the H-D Web site.  They know that a brand connects a business with the hearts and minds of consumers.

Photo courtesy of Interbrands and H-D.

All Rights Reserved © Northwest Harley Blog

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Pinterest Usage Data

Photos as content generates very high newsfeed engagement for all types of users.

And, unless you’ve been living on the Laffing Devils Motorcycle Club fantasy island you’ve more than likely noticed the staggering number of embedded photos on Facebook pages, Twitter and on Instagram as well as other similar type sites.

So, with the marketing resources at Harley-Davidson being at a premium, shouldn’t Mark–Hans Richer, the SVP and CMO of Harley-Davidson be paying closer attention to folks who are pinning photos of motorcycles and motorcycle clothing?  The short answer is yes.  More appropriately someone at the motor company should be standing on a conference room table and ask the question of all the H-D creative’s and strategists… “How did we miss the social growth on Pinterest?

What is Pinterest, you ask?

Pinterest is a kind of visual bulletin–or inspiration–board.  In short order I created one for this blog which you can view HERE.  Users create boards with categories like “Motorcycles I Love” or “Beautiful Motorcycle Places” or “Motorcycle Products That I Like.” Users can then link images from websites or upload images from their computers and “pin” the images to the boards. Similar to Twitter, users can follow other users, and Pinterest images can be re-pinned and shared.

Why should Harley-Davidson take this blog post serious?

Pinterest Growth

Because according to the Experian Marketing Services blog, Pinterest users skew female and young. Fifty-eight percent of users are women, and 59% are between the ages of 25 and 44.  This is a critical and key demographic that Harley-Davidson often states that they are trying to win over and accelerate both clothing and motorcycle purchases.  I’m not paid as a H-D media strategist, but wouldn’t it be a good idea to be visible where potential customers hang out?  This is the biggest no-brainer in the history of no-brainers!

In the U.S., growth in Pinterest has been phenomenal with more than 10 million registered users.  The image-sharing social network grew a staggering 4,377% in the last year, according to comScore’s “State of the U.S. Internet”.  It is outpacing competitors such as Tumblr which grew 168%, LinkedIn (67%) and Twitter (58%).  Outside the U.S. the number of Pinterest users in Latin America for example grew in first four months of 2012 from 153,000 to 1.3M.

It’s time for Harley-Davidson to just Pin it!

However, before they can do that they will need to resolve the issue of domain “parkers” because the current H-D URL belongs to Becky Segovia, yet has no content (boards, pins or activity).

Disclosure:  I don’t work for or have any financial interest in Pinterest.  I do try new technology and developed one for this blog which you can view HERE.

Photo courtesy Modea.com and Experian.

All Rights Reserved © Northwest Harley Blog

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