Indian Motorcycles

a heritage brand is reborn

You may recall, from another exemplar, that when travelling in the south island of New Zealand I met a motorcyclist enthusiast, riding an Indian Motorcycle, who was on a pilgrimage to visit E. Hayes Hardware in Invercargill. He explained to me how this hardware store had  Burt Munro’s – famous motorcycle – also known as ‘the world’s fastest Indian’ on display. Prior to meeting this motorcycle enthusiast, I thought the Indian brand had died; however, he explained that the brand was resurrected and brought back to life. He then explained the heritage of the brand and how saving Indian Motorcycles was a worthy cause – he was clearly what marketing practitioners refer to as a ‘brand evangelist’. 

A few hours later I found myself wandering around E. Hayes Hardware Store realised what a great marketing story it was.

On my return to Perth [Australia] I discovered that Indian Motorcycles had a retail store in Perth. And – what a great exemplar of retailing it turned out to be. If you are a Perth retailer – please do yourself a favour and visit this store. The staff and the customers [who were in the store having a coffee and a chat before a ride] were evangelists for the brand. The manager gave me a magnificent book to help me better understand the brand. The following is largely based on this book which outlines the history of motorcycles in the United States and the history of the brand – and it interesting story.

However, sadly, I discovered that all in 2020 the Perth store along with the other company owned stores in Australia had shut it doors and was moving towards the traditional franchise business model.

the 4 recurring patterns or quests

People tend not to think about the history and evolution of products. For some reasons I find the evolution of marketing fascinating. What is most surprising is that when you explore the evolution of marketing and society it appears as if it unfolded in a relatively orderly manner – one innovation at a time – step by step.

This history of marketing events is often overlooked – and today’s media conversations often describe how we are living in a time of complexity and disruptive change. Whilst this is true – it is important to consider that there have been other similar times – where the lives of society and consumers changed radically. We could say that an evolution has and is occurring.

Studying previous times of disruptions is enlightening for marketing practitioners and reveals 4 recurring patterns or quests:

• The quest to better serve the customer
• The quest to overcome the challenges facing society
• The quest for better use [application] of existing resources
• The quest for more effective distribution of: information, products, & people

Consider how Michael Faraday’s inventions led to the electrification of cities, factories and homes and how Thomas Edison’s inventions and improvements then lit up our lives and minds. It is hard to imagine a time when homes were not lit with the flick of a switch or where homes lacked today’s appliances [e.g., washing machines, dish washers, kitchen appliance, refrigerators]. It is also hard to imagine the effort and sacrifice by those who committed their lives and took the financial risk to develop the products we enjoy today.

If you are wondering what Faraday and Edison have to do with Indian Motorcycles – then please consider the evolution of the motorcycle – and how electric headlights were once a potential product > then an augmented product > and now an expected part of the modern motorcycle. Then consider all the innovations that made the modern motorcycle possible.

food for thought

Once when discussing the evolution of marketing – a 21 year old male asked me,”Stephen, I find this really interesting but how come I know all about Kim Kardashian and I have never heard of Michael Faraday or Thomas Edison?” I just looked and thought how did we allow this to happen.

the evolution of the motorcycle

Consider also the evolution from the horse to mechanical transport. The relationship between man and horse spanned thousands of years and there is no doubt that horses powered transport, agriculture, and later the industrial revolution. The turning point in this man-horse relationship can be traced to 1839 when a Scottish blacksmith, Kirkpatrick Macmillan, produced the first two wheeled pedal driven bicycle – sometimes referred to as a ‘safety bicycle’. Macmillan’s bicycle earned this name as it overcame the dangers of the penny-farthing bicycles. As Macmillan pedaled the Scottish countryside the advantages of bicycling were immediately apparent- particularly when travelling short distances. Macmillan’s bicycle did not require feeding, the inconvenience of agistment, maintenance, and harnessing that horses required. The convenience of the bicycle was particularly important for people who lived in cities as they could not keep a horse.

By the 1880s the manufacturing and marketing of bicycles was an important economic activity in many countries. This period was characterised by numerous innovations, such as the use of steel rather than wooden frames and cast iron, pneumatic tyres invented by John Boyd Dunlop which gave increased speed and comfort and gearing systems such as the derailleur by  Paul de Vivie which was designed to take the strain out of pedaling uphill. Consequently, the bicycle became more practical, affordable, and the preferred means of transport for the masses.

In the United States, George Hendee, a champion cyclist [of the penny-farthing era] and bicycle salesperson, founded the Hendee Manufacturing Company in 1889. Within ten years the Hendee Manufacturing Company were manufacturing and 4,000 bicycles a year with brand names such as the ‘Silver King’ and Silver Queen’ and ‘American Indian’.

Author’s comment: Note the importance of branding in the 19th Century

As the European bicycle market entered the mature stage of the product adoption cycle, competition to better serve the customer intensified. With the design and development of compact internal combustion engines, ‘add-on’ motors to assist the rider became popular [note the similarity to e-bikes of today]. Engine innovations quickly followed, for example, the regulation of fuel and air [carburation] by, Swedish inventor, Oscar Hedstrom resulted in smoother, more reliable, and more economic motors – the sport of motorcycle racing was born.

Stumbled upon this magnificent ‘Indian Chief 1938’. The bike [and owner] had taken part in an annual run to Augusta, in Western Australia

The birth of the Indian Motorcycle company

 During a motor cycling event in the United States, Hendee and Hedstrom met, and in 1901 formed the Indian Motocycle Company [later changed to Indian Motorcycle Company]. The choice of name is interesting, as the relationship between the government and the indigenous people was covertly hostile, however, the North American public perceived the North American Indians as synonymous with the ability to roam freely.

The Indian Motocycle Company was at the right place at the right time and around this time other motor cycle manufacturers began, Excelsior (1896), Royal Enfield (1901), Norton (1902), Triumph (1902), Harley-Davidson (1903).

In 1913 the Indian Motorcycle Company sales reached a peak of 32,000 motorcycles. The product adoption cycle was similar to that of bicycle, however, around this time the founders retired. Although the first motor car with an internal combustion engine was produced by Carl Benz in 1885 sales were initially low. However, it is worth noting that just as the innovations to the safety bicycle were adopted by the motorcycle, the innovations within the motorcycle were adopted by the motorcar.

Consequently, the adoption of the motor car had a similar pattern to the adoption of the safety bicycle and the motorcycle. By 1903, France was producing 32,000 motor cars and the major automobile manufacturing country – with well established brands such as Peugeot and Renault.

1903 is also the year that Henry Ford founded the Ford motor Company in the United States. Ford, was unlike other motor car manufacturers; it had adopted a market penetration strategy appropriate to a growing market. Ford introduced a cyclic production philosophy of managing production efficiency to reduce the cost of production and to increase volume which in turn produced greater production efficiency, cost reduction, and a 36% drop in retail pricing. As you may recall this strategy was less successful as the market matured and Ford had the foresight to adapt – a strategic strength can become a strategic weakness.

With the increased adoption of the motor car and without the passion and innovation of the founders, new product development at the Indian Motocycle company was perceived as a cost and, consequently, sales declined. Although there were a few successes and the quality of the motorcycles remained high – the core product and satisfying the core customer were overlooked in a company run by accountants.

External factors

Factors outside the control of the Indian Motorcycle Company, such of World War I had a dramatic effect on both export and domestic markets. The company also turned its back on the domestic market through a focus on the military market. Consequently, Indian Motocycle Dealers had little choice but to sell Harley-Davidson Motorcycles – within a few years Harley-Davidson were out selling the Indian Motocylces two to one.

Then in 1929 came the Great Depression with exceptionally high unemployment, bankruptcies, and the closure of many banks. Fortunately, the Indian Motocycle Company was taken over by the du Pont brothers who focused on the core business and quality. Sales throughout the depression years were dismal until 1934, and then ordinary until 1940 when a new ‘iconic’ style emerged. However, in December 1941 the United States entered World war II and once again external factors inflicted financial strain on the Indian Motorcycle Company.

Through the experiences of returning servicemen the war also created two new competitors – the all-terrain Military Jeep and an appreciation of overseas motorcycles – initially British brands Triumph, BSA, Norton, Royal Enfield, however, this also opened the door for European and Japanese Motorcycles.

Just as the laws of physics cannot be ignored the laws of marketing must also be observed. For many years this once loved and respected brand was an exemplar of what not to do. However, there was such nostalgia connected with the brand that it kept rising from the canvas. Although the market was mature Harley-Davidson continued to build their brand.

a second chance

Then in 2011 a United States company, Polaris Industries, purchased the Indian Motorcycle brand. Polaris Industries was a well respected manufacturer of off-road vehicles, including the Victory brand of motorcycles – they had the required market knowledge, the engineering expertise, and the financial resources to ensure success – what is often referred to as strategic intent.

With a heritage brand name and a history of iconic designs the [new] Indian Motorcycle Company began to design and develop a completely new range of motor cycles – not re-badged Victory Motorcycles as I was informed in Invercargill. The designers had to respect the unique value proposition of the brand and effectively communicate the message to demanding motorcycle enthusiasts – who were already spoiled for choice. Furthermore, the designers and engineers had to overcome the challenges of staying true to the iconic Indian style yet be technologically superior.

Astonishingly, 27 months after purchasing this orphaned brand – the company released its new product range – you guessed it they had the iconic product names of chief, chieftain, and scout.

The branding of motorcycles is for a marketing student extremely insightful. This exemplar demonstrates how a heritage brand can be resurrected by superior market knowledge, great engineering, and strategic intent. Marketing students will also recognise how a respect for the 4 recurring patterns or quests can assist marketing practitioners to see camouflaged opportunities.

There is no doubt that many welcome the return of the Indian Motorcycle company. Since I first released this exemplar I have received emails thanking me as they didn’t know that ‘the Indian Motorcycle Company was back in business’ or telling me about ‘a friend who has a vintage Indian motorcycle’.

Source: Holmstrom, D. (2016). Indian motorcycle: America’s first motorcycle company. Minneapolis, Quarto Publishing Group.

Considerations

Task 1: Identify the relationship between the 4 recurring patterns/quests and this exemplar.

Task 2: Consider the theory expressed in the product life-cycle and product adoption in light of this exemplar.

Task 3: Consider the key success factors that Polaris faced when resurrecting this iconic brand.

Task 4: Consider the segmentation of the motor cycle market and briefly discuss the segmentation strategy of Indian Motorcycles today.