MAY 27TH, 2009
You can’t have a bad day…
Each of our 20 groups has a private e-mail system so they can discuss business issues with other group members. The other day I realized how negative the e-mails had become in one of the groups. The dealers were talking about how bad it was and had begun reinforcing it within the group. They were feeding off of each other and becoming increasingly negative. A couple of the dealers recognized what was happening and began working to counteract the gloom-and-doom e-mails of others. Soon, many of them responded and the e-mails went back to how to make it better instead of focusing on how bad it was.
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If history repeats itself, then what can be learned from prior recessions? Studies have shown businesses that increased or maintained advertising, development and growth initiatives during a recession do significantly better during the recovery period than those that make big cuts. 
To use an expression from a colleague of mine, do you mind if I borrow your brain? I’m in the midst of forming a panel for our upcoming Powersports Business Conference & Expo and would love to get some feedback from dealers on what marketing topics they would like to explore. 
In the current difficult economic environment, equity incentives may offer a way to retain and encourage valuable key employees without additional expense. Such incentives can take an almost infinite variety of forms, but a simple example might be to grant stock bonuses to key employees based on their individual performance and/or overall profitability of the dealership. Such stock bonuses can offer genuine rewards to key employees without any cash expense to the employer. In fact, stock bonuses usually result in tax deductions to the employer in an amount equal to the fair market value of the stock. 
Despite April’s overall U.S. retail sales being down about 9 percent compared to the year-ago period, there’s a group with a decent amount of money burning holes in their pockets: Gen Y. If you’re a scooter or low-displacement motorcycle dealer, credit isn’t going to be a problem either because this group has cash. During May and June, a considerable portion of Gen Y is graduating from either high school or college. In my high school graduating class, it wasn’t uncommon for a student to accumulate more than $3,000 during a graduation party. This year more people are giving cash gifts because it’s more practical, and graduates can buy what they want, including more expensive items, i.e. vehicles. 
Many shoppers today walk through the door of a dealership armed with enough product information from the Internet to give a product “walk-around” themselves. The question is, “What can today’s shoppers learn from your salespeople?” We know the most successful salespeople are seen by the shoppers as helpful, rather than simply trying to sell a motorcycle without regard for the shopper’s interests or needs. But if all a salesperson knows about a particular motorcycle are the specs printed in a brochure or the stats listed on a Web site, then many of the most serious shoppers will find little value in talking with that salesperson. 
As first-quarter earning statements have trickled out over the past several weeks, one thing has certainly become evident: There are some huge market share rumblings going on. Certainly that appears evident in the on-road motorcycle world. Harley-Davidson recently reported U.S. retail sales of 42,000-plus bikes, which equates to roughly 50 percent of the market share for the on-road business in the first quarter. (Harley actually lists its market share higher because of how it defines its own market.) 
Last month Facebook surpassed 200 million users – that’s more than half of our country’s population. With social networking sites exploding faster than their creators can keep up with them, businesses are diving in head first with no real goals or objectives, except to be part of the craze. Companies are creating profiles to attract consumers’ attention, but many are not as competitive because of their unfamiliarity with the sites. Yes, social networking sites can make reaching a broader audience easier, but as with anything else in business, you have to have a goal and a plan to reach that goal. 
Polaris Industries recently said it expects to lose less than 5 percent of its dealers this year as a result of the economic downturn. It was really the first official notification I’ve seen that relates to powersports dealership closures or bankruptcies. Oh sure, we do hear about such closings here and there through our contacts but rarely is there an official number or even percentage given out. 