April 5, 2010: Reinforcing the brand image

By Neil Pascale

Editor

SCOTTSDALE, Ariz. — After a year in which every one of its markets shrank in size, Ducati Motor Holding brought a fundamental message of stability to its North American dealer base.

The president of Ducati’s parent company told dealers the company is in better financial shape today than it was four or five years ago despite the state of the worldwide sport bike market.

“You can rely on us,” Gabriele del Torchio, president of Ducati Motor Holding, said during the day-long meeting held at a Scottsdale, Ariz., hotel.

Ducati executives not only spoke of the company’s sound financial base but of its improving market shares in North America and abroad. They spoke of the importance of reinforcing the Italian brand’s unique lifestyle opportunities to both present and future consumers and what new programs are aimed at doing just that. They discussed the company’s continued commitment to product development, including the fact that Ducati’s R&D plan was not altered even after the worldwide sport bike market suffered a 41 percent hit in 2009, bringing it back to volume levels not seen in 15 years.

“We didn’t cut one single dollar from new product introduction,” Del Torchio said, noting the company has spent $150 million in the past three years on product development alone, “by far the highest amount in our history.”

Del Torchio, who has led Ducati’s parent company for three years now, repeated a message he gave dealers two years ago about the North America market, what he described as the “most demanding and complex market in the world.

“Success has become my personal challenge,” he said to dealers. “I don’t like defeat, l like winning, as you do. So let me tell you, you have my complete commitment.”

Part of that commitment lies in new programs aimed at allowing Ducati to continue to outperform the market, which it did last year.

“The one thing that we’ve learned through this miserable recession is the idea that the premium brands suffer the most is not the case this time around,” Ducati North America CEO Michael Lock told Powersports Business in an interview after the dealer meeting.

“This is a different recession. This is as much a blue-collar recession as a white-collar recession. And we all braced ourselves for, ‘Oh my god, we’re like the jewelry of the motorcycle industry. We’re Ducati. We’re going to get whacked.’ And we didn’t. We had a hard year last year but compared to almost everybody else, we did well.”

Ducati was one of three on-road motorcycle brands in 2009 that decreased less than 30 percent in new unit sales compared to a year ago in the U.S market. The entire U.S. on-road market, meanwhile, shrank 41.5 percent. As a result, Ducati saw market share gains, and it now has seen its share double since 2005.

Lock attributed much of those gains to the fact that the brand remains a pivotal piece in their consumers’ day-to-day lives.

“The message of today,” Lock told dealers, “is we have to be more of what we are, not less.

“It doesn’t mean we can’t save money, tighten our belts where the customer can’t see it,” he said, while also cautioning dealers to be judicious in where they cut. “If you cut back on the show, you give people a reason to stay home.”

Ducati believes its new Multistrada 1200, what it labels as an “adventure bike with super sport bike components,” will do just the opposite.

Lock called the Multistrada, which the company says has the technology to make it a sport bike, a touring bike or an enduro bike, potentially more important to Ducati than the 1098, its acclaimed sport bike, was at its introduction. “The 1098 was about taking what we know and doing it a bit better,” he said. “This new bike is about venturing into new ground.”

Ducati officials noted retail sales in the adventure segment have been much more stable globally than sport bike sales, which once approached 320,000 units per year globally but were roughly half that in 2009.

As part of the Multistrada launch, Ducati worked with a number of high-profile aftermarket companies to provide not only technical gear — PUMA boots and Aria helmets to name two — but accessories as well, including Garmin GPS units.

Besides targeting that more stable adventure market, Ducati also is trying to improve its Monster and superbike segment business. The latter will be the focus of a new program called Ducati Fast Track where buyers of 2009 or 2010 superbike will receive a race-day package that includes a one-on-one session with a holder of racing titles as well as a number of accessories for that track day.