When I was a kid, I used to believe that all racing was about was glory. Well, glory and money. Even in the bedtime stories my folk used to tell me, the mighty warrior getting rid of the dragon or witch was rewarded with half of the kingdom and the hand of the beautiful princess in marriage. So yes, wealth was also considered as part of the reward even in the fantasy world.
However, as years passed by, things have also started to look clearer as far as racing is concerned. It became obvious that money must move, and nobody invested a dime in racing just for the kicks. Well, there are some privateers who are either very rich or can manage to draw generous sponsorships and they’re in for the fun of racing.
Still, the fellows who are deep in the industry are expecting what is called the return of investment or ROI. That is, no motorcycle manufacturer would spend a significant amount of money just to be there on the grid. This is not enough. If you’re up for racing, how about trying to win, too. But becoming “bigger best, better than the rest” requires even more money, and money must come from somewhere.
Why isn’t winning races enough, some might ask. Mostly, because people who buy their first motorcycle are no longer that much enthralled by the act of racing alone. That is, the number of customers deciding to buy Yamaha because they like Rossi or Lorenzo is rather insignificant in relation to the rest of the sales. Likewise, only few people would go buy Ducati just because the Borgo Panigale bikes have won 5 out of the last 10 World Superbike championships.
The changing world and the information overflow have created a pool of much better-informed customers. Back in the ‘90s people would have been more susceptible of choosing their first bike upon how it performed in the racing season, but things are different now.
Why do I keep mentioning “first bike”? Because selling a new bike is the main thing which drives the business. The fact that you sell your ’95 Yamaha Virago 535 and get a 2003 Sportster doesn’t make Harley that happy, or Yamaha too sad, for what’s worth. Their moments of joy have been when the VINs of those two bikes have been registered for the first time. You’re only providing a margin for them when you buy spares, accessories or apparel. In certain cases, not a negligible sum, definitely, but still, not on par with another new bike sold to the final customer.
Having said that, there’s one more thing I have to add before we skip to the WSBK. MotoGP isn’t either going to draw huge sales, not even if Honda would ”Repsolize” all the bikes they make around the world. Prototype racing is however helping manufacturers refine and discover new technologies they can later implement in road bikes and make sure they have an edge over the competition.
Well, sort of, really, because a 2 million euro frame has only limited things it can offer to a 10k euro bike. And this is how things work in spite of all the claims marketing specialists will throw at their potential customers. The fact that a frame or swingarm will become better thanks to the things MotoGP engineers discover is beyond doubt… but really, this will only help sales just a tiny bit.
While jumping from the existing 14-round format to a 16-round one may seem not that much of an improvement. However, after dropping the South African and the Russian ones this year, it looks like 12 rounds isn’t exactly paying off for everybody.
The motorcycle industry suffers from the effects of the financial turmoil, and each plus is, well, a plus. Manufacturers understood that the markets are once more relying on a simple “out of sight, out of mind” principle. This means that still the visibility of a product or product range is the key to stealing the customer’s heart. Because what the eye sees, the heart craves, and since world-level road racing is now pretty much absent in a lot of emerging markets, this might be an untapped resource.
2014 was Dorna’s first full year of WSBK racing and things are already on the move, officials say. WSBK rounds are envisioned for Chile and Thailand for the first time ever, in an effort to reach out more people. Race attendance and TV rights mean more money for Dorna, but emerging markets provide excellent exposure for the manufacturers.
Crowds are expected to gather in large numbers to witness what road racing is like, and since the series is based on production models, this will lead to a stronger relationship between the on-track dream bikes and those in the dealership. This is a two-way street, as Dorna knows that customers in markets where manufacturers involved in WSBK already have good sales will also be more likely to attend local rounds.
WSB Director Daniel Carrera is openly speaking about this, “We need to go to the growing markets where the manufacturers are selling bikes and this is a request for them. We will continue to improve the level of the championship.”
More so, with the more restrictive regulations which will be enforced in the World Superbike series, the track machines will come even closer to the production road bikes. People who intend to buy a new bike should feel that the bike they see on the track, possibly ridden by their favorite pilot has a decent resemblance to that in the showroom. When this happens, the new, crated machine is half-sold.
This will work for more than supersport and superbike machines, because the increased presence of a manufacturer in a certain market will definitely draw more types of customers. After all, the superbike segment is marginal in the big picture. For example, BMW sold only 168 S1000RR units in the US in September 2014, from a total of 914 units sold. Through Q3, the percentage is even lower.
Expanding the WSBK series to other countries which have good growth potential for the motorcycle sales could indeed help both Dorna and manufacturers grow their business. And when business grows, other things that make life good do, too.
Still, the fellows who are deep in the industry are expecting what is called the return of investment or ROI. That is, no motorcycle manufacturer would spend a significant amount of money just to be there on the grid. This is not enough. If you’re up for racing, how about trying to win, too. But becoming “bigger best, better than the rest” requires even more money, and money must come from somewhere.
Race winners are not necessarily sales winners
Being a motorcycle manufacturer means that most of the profits come from selling the bikes. Since customers would not take kindly on higher prices, how about selling more? But then again, it’s all a matter of convincing the buyers to choose your product over the competition. Is winning races enough to sell big? No, and I’ve already covered this issue in the “When Winning Races Is No Longer Selling Bikes” editorial in late February.Why isn’t winning races enough, some might ask. Mostly, because people who buy their first motorcycle are no longer that much enthralled by the act of racing alone. That is, the number of customers deciding to buy Yamaha because they like Rossi or Lorenzo is rather insignificant in relation to the rest of the sales. Likewise, only few people would go buy Ducati just because the Borgo Panigale bikes have won 5 out of the last 10 World Superbike championships.
The changing world and the information overflow have created a pool of much better-informed customers. Back in the ‘90s people would have been more susceptible of choosing their first bike upon how it performed in the racing season, but things are different now.
Why do I keep mentioning “first bike”? Because selling a new bike is the main thing which drives the business. The fact that you sell your ’95 Yamaha Virago 535 and get a 2003 Sportster doesn’t make Harley that happy, or Yamaha too sad, for what’s worth. Their moments of joy have been when the VINs of those two bikes have been registered for the first time. You’re only providing a margin for them when you buy spares, accessories or apparel. In certain cases, not a negligible sum, definitely, but still, not on par with another new bike sold to the final customer.
Having said that, there’s one more thing I have to add before we skip to the WSBK. MotoGP isn’t either going to draw huge sales, not even if Honda would ”Repsolize” all the bikes they make around the world. Prototype racing is however helping manufacturers refine and discover new technologies they can later implement in road bikes and make sure they have an edge over the competition.
Well, sort of, really, because a 2 million euro frame has only limited things it can offer to a 10k euro bike. And this is how things work in spite of all the claims marketing specialists will throw at their potential customers. The fact that a frame or swingarm will become better thanks to the things MotoGP engineers discover is beyond doubt… but really, this will only help sales just a tiny bit.
Can World Superbike do something about this?
It looks like the answer is “yes.” Maybe not a fully-confident “yes,” but definitely a positive answer. Earlier this month, Dorna Sports, the owner of both MotoGP and WSBK rights said that the later series would be expanded, with solid efforts being made to have a 16-round championship.While jumping from the existing 14-round format to a 16-round one may seem not that much of an improvement. However, after dropping the South African and the Russian ones this year, it looks like 12 rounds isn’t exactly paying off for everybody.
The motorcycle industry suffers from the effects of the financial turmoil, and each plus is, well, a plus. Manufacturers understood that the markets are once more relying on a simple “out of sight, out of mind” principle. This means that still the visibility of a product or product range is the key to stealing the customer’s heart. Because what the eye sees, the heart craves, and since world-level road racing is now pretty much absent in a lot of emerging markets, this might be an untapped resource.
2014 was Dorna’s first full year of WSBK racing and things are already on the move, officials say. WSBK rounds are envisioned for Chile and Thailand for the first time ever, in an effort to reach out more people. Race attendance and TV rights mean more money for Dorna, but emerging markets provide excellent exposure for the manufacturers.
Crowds are expected to gather in large numbers to witness what road racing is like, and since the series is based on production models, this will lead to a stronger relationship between the on-track dream bikes and those in the dealership. This is a two-way street, as Dorna knows that customers in markets where manufacturers involved in WSBK already have good sales will also be more likely to attend local rounds.
WSB Director Daniel Carrera is openly speaking about this, “We need to go to the growing markets where the manufacturers are selling bikes and this is a request for them. We will continue to improve the level of the championship.”
More so, with the more restrictive regulations which will be enforced in the World Superbike series, the track machines will come even closer to the production road bikes. People who intend to buy a new bike should feel that the bike they see on the track, possibly ridden by their favorite pilot has a decent resemblance to that in the showroom. When this happens, the new, crated machine is half-sold.
This will work for more than supersport and superbike machines, because the increased presence of a manufacturer in a certain market will definitely draw more types of customers. After all, the superbike segment is marginal in the big picture. For example, BMW sold only 168 S1000RR units in the US in September 2014, from a total of 914 units sold. Through Q3, the percentage is even lower.
Expanding the WSBK series to other countries which have good growth potential for the motorcycle sales could indeed help both Dorna and manufacturers grow their business. And when business grows, other things that make life good do, too.
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