Harley-Davidson Brand Drops 24% in Value – Threatens to Fall Off The Interbrand 100

Google+ Pinterest LinkedIn Tumblr

Interbrand, the leader in brand consultancy, ranks the Top 100 brands each year according to their brand value, with brands like Google, Coca-Cola, and McDonalds usually taking the top honors. Interbrand’s method looks at the ongoing investment and management of the brand as a business asset, and then assigns a dollar value to that asset.

In motorcycling no brand is worth more than the Bar & Shield of Harley-Davidson, and the Milwaukee-based company is an Interbrand 100 regular. Dropping nearly 24% of its brand value this year (the most out of all the Interbrand 100 companies), Harley-Davidson fell from 76th on 2009 rankings to 98th in 2010, losing over a billion dollars in brand value in the process.

This drop means Harley-Davidson is precariously close to falling off the Top 100 global brands list, and is seeing one of its most important assets drop in value. Interbrand attributes Harley-Davidson’s decline to a weak economy for motorcycles, and missteps in the company’s image through , and hiring a non-riding CEO:

Over the past three years, Harley-Davidson has seen a rapid decline in brand value as it becomes a less relevant purchase due to the recession. To deal with its losses, the brand has decided to restructure, exiting the sport bike market; it will discontinue its Buell product line and sell its MV Agusta unit, with the goal of focusing fully on the Harley-Davidson brand. However, unless it also invests into innovating, its product could become stale. This year, the brand also experienced some negative social media and press from an audience upset by the fact that the new, numbers-focused CEO does not ride a Harley.

The times are certainly tumultuous for Harley-Davidson, as the company recently played hardball with its Wisconsin-based laborers, parted ways with its long-time ad agency Carmichael Lynch, and issued Q3 stock dividends to help spur financial investors into buy Harley-Davidson stock. With an aging customer base and a stagnant product line, analysts and pundits (ourselves included) have clamored for Harley-Davidson to start innovating in its product offering. With a juggernaut like Interbrand echoing those sentiments, maybe Harley-Davidson will finally start listening.

Source: Interbrand 100