Story of a Dying Business Revived
Everyone has a good product at a reasonable price these days, and if you are not meeting your customers’ expectations, then your business is dying. But Ken Schmidt, former director of corporate and financial communications at Harley Davidson, asked members at the Specialty Metals Conference in March, “What do you want your customers to say about you and your business? And what are you willing to do to get that?”
Schmidt described how eight years ago Harley, on the brink of bankruptcy, dramatically changed the culture of the company, reinvented its story and turned their customers into the company’s most powerful advocates. The result: a sales explosion from 35,000 motorcycles worldwide in the mid-1980s to some 300,000 this year.
“We realized we were selling the exact same way as all our competitors, mainly emphasizing quality,” he said. “Now our story differentiates us. We are a brand that stands for passion and a lifestyle, satisfying that need that says ‘look at me’.
“We control the narrative about our company and work at getting the media and our customers to describe our company the way we do,” Schmidt said. Harley nurtures and trains its employees, so when someone walks into a showroom, they are welcomed “by some of the most passionate people on the planet. The result has been that we don’t have customers, we have disciples. And that is what you all must have to stay competitive in your businesses.”
Schmidt said manufacturers and metals producers tell him all the time that they are selling their product first and that’s what their customers want. “But everyone has a good product that they deliver on time at a reasonable price. At Harley, we used to be a so-called ‘product first’ company. And we dug our own grave with that philosophy.
“When you present to the market the same as your competitors, all you have as a differentiator is price. Low price and convenience become your trump card,” Schmidt said. “You’ll say, ‘Well we are just an American backbone type business, we are just selling metal.’ But that’s what we thought at Harley too. Bikes basically all do the same thing and they do it well. You can buy a big Honda for $16,000 less than a Harley. But Harley outsells Honda 10 to 1.”
Schmidt reminded the audience that most people do not buy with their brain but with their gut. “They buy from you because they like you and trust you,” he said, “And you have to give them a story to tell about you. If you are running a business that is just meeting expectations, you are not building the business.”
Think hard about building a “social strategy,” a powerful marketing strategy with a message that turns customers into advocates and creates a point of difference between you and them. “Harley Davidson today is a brand that stands for something way beyond big bikes and road outlaws. Innovation, quality and service, but also people-oriented and stylish. We remade our culture and you can too.
“What do you want them to say about you?” Schmidt repeated just before he left the stage. “And what are you willing to do to get that?”