Can Harley Davidson Hold On To the Youth Market?

Harleys are for old men and hardcore biker gang members.

At least, that’s the perception many younger riders have of the company and its products.

For at least the last ten years, Harley-Davidson Inc has largely failed to reach a younger audience – and it’s the tastes of that audience that’s likely to determine the future health of the last big American motorcycle manufacturer. The Milwaukee firm has pounded enormous amounts of money and resources into new lines of motorcycles aimed squarely at 20 and 30-year-old riders as Harley’s core customer base became grayer and older.

“Our goal really was to be the No.1 seller of motorcycles to young adults in the United States,” said Chief Marketing Officer Mark-Hans Richer. “We are now.”

Chief Executive Keith Wandell says that effort is finally paying dividends, figuratively if not yet literally, after he began modernizing the company.

The price of those changes? Offending the graying crowd of Harley loyalists, for one…

In a speech to analysts at Harley’s plant in Pennsylvania a couple of weeks ago, Wandell said he’s committed to “extending the reach of the brand beyond our core customers.”

That’s what Wandell said, but he may not be entirely convinced of the strategy and he’s certainly unsure of the possible repercussions.

“That’s a touchy situation. Our core customers have allowed our company to be successful – so there’s a certain amount of jealousy, if you will, around the brand,” Wandell said.

Well no kidding…

The new, shaved-down and nearly bobbed bikes that make up the Dark Custom lineup and aren’t your father’s Harley anymore, and the old line customers are making sure the dealers know it.

“They’re like, ugh, that’s not a real Harley,” said Joe Fredo, sales manager of Harley-Davidson of New York City.

But it’s not the traditional buyer of Harley-Davidsons that the company is counting on to keep the production lines running in York, PA. The company’s push to skew younger has eaten up millions of dollars worth of investment in design changes, youth marketing of lower-priced machines – and perhaps most importantly –  a considerable effort to teach thousands of neophyte bikers to operate a their machines.

“Our goal really was to be the No.1 seller of motorcycles to young adults in the United States,” said Chief Marketing Officer Mark-Hans Richer. “We are now.”

And he’s not wrong. Since the changes Harley has increased its share of the heavy-bike market sold to buyers under the age of 35 by more than a thirty-three percent and H-D now lays claim to 48.6 percent of that critical youth market, and that’s according to R.L. Polk & Co.. It means the Men of Milwaukee now quadruple the share of its closest competitors in the big-bike segment. In 2008, just under seventeen percent of new Harley buyers were under the age of 35,and by 2010, the number ballooned up to 21 percent.

If you think it’s all over but the shouting and H-D has won the youth war, think again. Wandell notes that the current age of the company’s average buyer is a stodgy age 55.

The new Dark Custom trim line bikes like the Street Bob are a reflection of a shift in taste toward a more old-school and sporty design.

“Young people love the look of it. It’s kind of that rockabilly, rock-and-roll, urban, cool cruiser look,” said Kenn Hartmann, a salesman at Harley-Davidson in Berwyn, Illinois.

Pricing has definitely been a key and the cheap bike is fueling the brand with a younger demographic. The bike with the most momentum on its way out of showrooms? The Iron 883 in the Dark Custom trim.

“Our bestseller is our cheapest bike,” said Fredo. “I can hardly keep them in stock.”

Lower-priced Sportster sales are growing twice as fast as Harley-Davidson’s other motorcycle lines.

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