Demo rides become more commonplace at dealerships – July 24, 2006
July 24, 2006
Filed under Features
The latest J.D. Power and Associates Motorcycle Competitive Information Study shows conclusively that test rides pay off for powersports dealers, who are seemingly warming to the idea.
More dealerships were offering test rides in 2005 than five years earlier, according to J.D. Power and Associates surveys, even with the potentially high insurance costs associated with demo rides.
In 2000, only about 17 percent of riders took a test ride before purchasing a bike. The survey was made up of people who had purchased new motorcycles, so despite the fact they did not get a demo ride, the other 83 percent still bought. Of course, we’ll never know how many potential customers asked for a demo ride, were refused and either went elsewhere to buy, gave up or never intended to buy in the first place.
Five years later, the number of riders who test drove before buying a bike increased significantly. When asked in 2005 if they were given the opportunity to ride the bike before purchase, nearly 30 percent of consumers reported they had.
The most current J.D. Powers and Associates survey added a second question, asking consumers to “indicate the degree to which the test ride influenced” their purchase. Here, nearly 60 percent said it “strongly influenced” their choice, 30 percent said it had a “moderate influence,” and nearly 10 percent said it was “no influence.”
Vastly different test ride programs exist with the OEMs.
Garrett Kai, senior communications specialist with American Suzuki in Brea, Calif., said Suzuki does not have a demo ride program for dealerships, but rather has a demo team that travels to major events, such as Daytona, Americade, the Biketoberfest and others. “We feel we can handle it more efficiently at these events,” Kai said.
Ducati, conversely, takes a pro-active approach to demo rides.
Ducati spokesperson Nick McCabe said, “As a manufacturer, we cannot be more committed to believing in the value of using demo rides as a tool to sell a motorcycle. Demos are the responsibility of the dealers, but we firmly believe in them and are very aggressive with giving our dealers tools to encourage them to utilize demonstrators and demo rides. For example, we require all of our dealers to have at least two demos in stock at all times in order to qualify for maximum sales program incentives. Also, in order to make it easier for them, we invoice special demo bikes with extended terms and give some significant discounts upon the retail of the bike.
“We generally feel that around 10 percent of a dealer’s current stock should be demo bikes, but it varies depending upon the model mix and the time of year. A smart dealer will really use the demo program and have a pre-mapped-out demo route and a strong and supportive approach to demonstrator rides.”
As for deciding which potential customers qualify, McCabe said, “It varies significantly, but generally dealers qualify the individual and take into account the relationship with the customer and the relative experience, as well as numerous other factors. As a manufacture, we try to make it easy and profitable to encourage the dealers to do demo rides, but we don’t want to be the ones policing them for the dealer — we don’t have enough staff to do that!”
In the past five years, McCabe said, “We have gotten more aggressive with encouraging demonstrators at the dealer level. We also have a demo fleet that goes around the country and makes stops at certain dealer open houses and significant motorcycle events.”
Kawasaki does not have a dealer program for test rides, but does offer testing at consumer shows throughout the year. At these shows, which will number nine this year, consumers can try any motorcycle from the Kawasaki sport lineup, including the new Ninja ZX-14 and Ninja ZX-10R.
Honda has a year-round demo program for dealers that provides flooring terms through American Honda Wholesale Finance on all new on-road motorcycles and scooters to qualified dealers. Honda also has five national demo events for consumers this year, including at the Honda Homecoming (July 27-29, Marysville, Ohio) and Biketoberfest (Oct. 19-21, Daytona Beach, Fla).
How do dealers decide who to give demo rides to?
Duane Dreyer, president of Dreyer Motorsports, Indianapolis, Ind., said before giving a demo ride, “we like to have (consumers) say they’ll buy the bike at a certain price if they like it, and have them sign a liability form.” Dreyer said they have sold several bikes as a result of Yamaha’s Roadliner demo program.
Another aggressive dealer is Tom Hicks, president of Southern California Motorcycles in Brea, Calif. “I have 18 demo bikes in my three brands of Triumph, Ducati and Victory.
“My staff and I offer demo rides with restrictions — they have to have their own gear. I’m not going to risk my business for somebody’s joy ride. There are some questions we ask: What do you ride? When’s the last time you rode a streetbike?
“The insurance is part of my whole garagekeepers program, and I pay upwards of $25,000 for it. But then again, we sell motorcycles. They leave on a test ride and come back excited.”