KEN SCHMIDT knows how to differentiate himself as a speaker and communications consultant. At various times during his career, he has ridden into the room on a thundering Harley-Davidson motorcycle and parked it next to the podium.
He didn't do that when he appeared at the Truck Trailer Manufacturers Association's 63rd annual convention in Savannah, Georgia, May 13.
He didn't have to. His booming voice and fast-paced, motor-mouth style filled up the Grand Ballroom at the Westin Savannah Harbor Golf Resort and Spa. Schmidt, who was credited with helping resuscitate Harley-Davidson while in the position of director of communication, made some noise. And in his presentation, “Make Some Noise,” he encouraged the TTMA members to do the same.
“Honda, Yamaha, Kawasaki, Suzuki … they all make the same product and the same sound,” he said. “The net result of that environment where people can't tell products apart and can't differentiate brands is that when these companies reach out to that first-time buyer, they will typically reach out not so much on brand as on price. Because if it has the same engine size, it's not whose name is on the gas tank, but how much is on the price tag.
“But what does a Harley-Davidson sound like? From this point on, please promise me you'll say three words: VOICE … OF … GOD. It's a different sound. When a Harley-Davidson is approaching, you know it before you see it. It's a distinct sound, a glorious sound, a different sound. When we hear it, a picture forms in our mind. What do we do when we hear it, more often than not? We will turn and look to confirm that what we thought is indeed a Harley.”
Schmidt said all of us make noise. But how do we make it? Do we do it with energy and enthusiasm for what we're doing? Do we set ourselves apart visibly and memorably from other people?
He said our noise is the way people who are important to us describe us when we're not there. When someone is talking about us by name, a picture is being painted about who we are and what we represent.
“What kind of noise does your business make?” he asked. “When the people who are important to your business — otherwise known as the people who can put you out of business — talk about you by name, they are defining your business. What are they saying about you? You're not who you are — never have been and never will be. Are they describing you with the same language they use to describe your competition? If so, that's a bad, bad environment, a difficult competitive environment.
“The reason why Harley-Davidson is the most successful company serving any industry on the planet is because we made a conscious decision to stop doing business the way everybody else does and the way we're expected to. Look, what does a motorcycle do? It's two wheels, a seat, a set of handlebars, and a motor. They all go forward under power. They all get you from Point A to Point B.
“Everybody is doing the exact same thing. Everybody is saying the exact same thing: ‘We stand for quality, for commitment to customer satisfaction.’ All that's great. But when everybody's saying the same thing, are you listening anymore? When was the last time somebody won you over with their quality message?”
We're not logical
He said Harley-Davidson came to the conclusion that we are not a rational, logical species. We make decisions with our heart. It's a feeling in our gut, not our brain.
Showing a slide of a Harley-Davidson model, he said, “$26,000 out the door. Rational and logical purchase, guys? Bring that home and your spouse is going to applaud your common sense? That same money is going to buy you four Kias. There's nothing rational or logical about it. That's why it works.”
Showing a slide of a man with tattoos all over his back — the Harley name and logo, an early model, and a recent model — Schmidt asked, “When was the last time you felt so strongly about something that you went out and had that corporate symbol permanently etched into your skin? ‘I'm a Harley-Davidson person. This Harley-Davidson thing means more to me than anything in the world.’ We get that message, don't we? What's he telling us on the inside? It's the same thing that every human being on the planet says every day when we lift our head off the pillow: ‘Look at me. Notice me. React to me. Validate my existence.”
He said most of us are metaphorically invisible people. We are stuck in a never-ending cycle of faceless, nameless, emotionless, non-memorable transactions. We are creatures of habit who do the same thing every day. We shop the same stores. We even walk in the same pattern every time we go grocery shopping.
And businesses are operating with the same creature-of-habit style.
“Think of the last time in a business environment when somebody did something extraordinary for you that surprised you and delighted you, that made you feel good about yourself, that validated your existence as a human being,” he said. “When you do that 100% of the time, customers are going to tell somebody else.”
He said Harley-Davidson will sell 350,000 motorcycles this year through “noise” — word of mouth, customers telling friends and co-workers.
In a heap of trouble
Of course, Harley-Davidson had to do something different.
It was dying.
Amid a barrage of inexpensive imports, Harley-Davidson was purchased by American Machine and Foundry Co in 1969 for $21 million. Quality suffered; the company was saddled with the reputation of mechanical breakdowns. AMF put the company up for sale in 1980, and a group of 13 Harley executives bought it back a year later.
The company, saddled with $70 million in debt from the buyout, lost $50 million in 1981 and 1982, and narrowly avoided bankruptcy in 1983 and again in 1985.
As the country experienced nationalistic, anti-Japanese sentiment later in the decade, Harley-Davidson became a symbol of American resilience. It began to reinvent itself.
Admitting that its failures were due not to Japanese imports but to its own poor quality control, it asked its employees what they would do to improve it.
The company then released its first new engine in 20 years — an engine that found its way onto the three magazine covers.
Then the company diverted radically from the way motorcycles typically were sold, offering customers the chance to go on a 15-minute test ride before buying. Harley-Davidson built two semi trucks, filled them with motorcycles and went right to the people. Harley-Davidson asked them what they wanted, and then proceeded to give it to them. The company also spruced up its local dealerships to make them inviting.
“There was a positive buzz,” Schmidt said. “Customers realized, ‘There's nothing wrong with these guys.’ We were attaching a human face to a Harley-Davidson. They weren't afraid anymore.
“We set up demos at the Sturgis, South Dakota, rally. We found out an awful lot of people didn't like us. We also found they were able to vent and wanted Harley-Davidson to succeed. A lot of our customers were war vets who were proud of America and would not tolerate riding on an imported product. People started to stay, ‘They're trying.’”
The beauty of HOG
In 1983, Harley-Davidson established the Harley Owners Group (HOG) in response to a growing desire by Harley riders for an organized way to share their passion and show their pride.
“There were meetings, parties, fundraisers,” he said. “Friendships developed. People who didn't feel respected, or who spent their entire day in front of a computer, were being called by their first name at the dealership. They were saying, ‘I like the way this makes me feel.’ White-collar professionals were never a target, but they started showing up.”
By 1985, 49 local chapters had sprouted around the country, with a total membership of 60,000. Today, there are 900,000 members worldwide, and Schmidt calls HOG “the largest and most powerful ownership group on earth.”
“People want to express their individuality,” he said. “When you lift people up out of their invisible life and make them feel good about themselves as individuals, you succeed. People will naturally seek out those businesses that understand that and intentionally do things differently. You need to find out what's important to the people who are important to your business. Marketing materials, quotes, Web sites need to be catered to what motivates them. What attracted them to your business in the first place? Ask people, ‘What do you like about us? What sets us apart?’ That's the button you need to push.
“The internal culture is important. Leadership sets the tone and employees model the behavior. Why is there a chasm between employees and leadership? Because leadership is asking them to do things leadership won't do themselves. Are you going to lift people up? What kind of noise are you making?”
Oh, and one other thing: Harley-Davidson stock that was worth $10,000 in 1987 is now worth $1.6 million.