September 24, 2007 – The naked segment: a niche with potential?

By Neil Pascale
Editor
Kevin Foley represents the type of consumer that could turn the standard or naked segment of the U.S. sport bike market into a more meaningful market class.
Foley, the media relations manager for Yamaha Motor Corp. U.S.A.’s street motorcycles division, did not want another race replica sport bike for his latest new bike, preferring something that would provide a little more comfort for his morning commute.
He chose a Yamaha FZ, a type of motorcycle that is infinitely popular in Europe but has failed to catch on in such numbers in the U.S.
Although there’s no sign the North American naked segment will catch up to its European counterparts in the short term, there are indications the major metric manufacturers are feeling more confident about potential growth in that segment.
This fall, Suzuki will introduce its high-powered naked bike, the B-King, to U.S. dealer showrooms. Kawasaki also has introduced the 2008 Versys, and Yamaha continues to update its two naked models, including the FZ1000, the No. 1 selling bike in its class, according to Foley.
The Yamaha FZ rider calls the entire naked segment healthy, noting the segment is largely flat, comparing July’s retail sales to the year-ago period. Although flat sales are hardly anything to get excited about, they do represent a better than industry-wide performance. The on-road motorcycle market as a whole was down 5 percent in the first half of this year.
Ducati North America CEO Michael Lock sees potential for the naked market, especially with the “decline in popularity of the cruiser market and the aging demographic there.
“The bikes are great,” Lock said, noting Ducati’s naked bike, the Monster, has 25 percent of the market share in its class. “The bikes are a blast to ride. They give riding satisfaction at sub-100 mph speeds.”
Another major player in the segment, Triumph, also sees potential growth for sales of naked bikes. Jim Callahan, marketing manager for Triumph Motorcycles America, notes Triumph has seen growth in its Speed Triple sales, although he doesn’t know if that’s because of an expanding naked segment or a reflection of the company’s overall growth.
“Here in the U.S., naked bikes have always been kind of a voodoo science,” Callahan said.
The mystery over the market reflects the extreme differences manufacturers see between the bike segment’s popularity in Europe and the U.S., a reflection of how the two biking cultures have evolved. In Europe, motorcycling grew out of the working class’ need for inexpensive transportation whereas bikes have always been looked upon as toys in the U.S. market.
Still, Lock believes part of the reason the naked segment has not caught on so strongly in the U.S. is the reluctance of major manufacturers to back the bikes with sufficient marketing.
Glenn Hansen, the communications manager for American Suzuki Motor Corp.’s motorcycle/ATV division, believes the amount of marketing that large manufacturers have done on the naked segment is on par with their annual retail sales.“Sales haven’t been great in the U.S.,” Hansen said of the naked segment. “Part of that is certainly proven by customer interest. When we sell two bikes, one with a fairing and one without and they’re similar, the naked bike does not sell quite as well.”
So with a so-so history in the naked segment, why did Suzuki bring the B-King to the U.S. market? Hansen said it reflects the company’s goal of reaching different street niches.
“We sell a lot of motorcycles as a whole, but we sell to a lot of different segments,” he said. “We think we have a great product to offer in that naked category, and we want to offer it to the American consumer knowing that we’re not going to sell in the numbers that we sell our GSX-Rs. But we think we can make an impact in that market, and it took us up to this point to have the bike to do it.”
Triumph’s Callahan believes some of the sorted history of U.S. naked sales reflects back on manufacturers’ decision to offer two versions of a particular model, one in the race replica market and one with inferior features for the naked class.
“They usually have a different frame, different suspension components,” Callahan said of the naked version of the model. “They’re heavier. They’re slower. They’re usually a far cry from the faired version of it.”