July 23, 2007 – Getting a better handle on the first-time buyer
July 23, 2007
Filed under Features
Ed Klim, president of the International Snowmobile Manufacturers’ Association (ISMA), is straight-forward about what it’s going to take to turn around disappointing snowmobile sales: more snow, more first-time riders and more money to reach those potential lifelong winter powersport enthusiasts.
According to ISMA statistics, snowmobile sales fell for the 10th consecutive year. Gathered from April to March, these numbers show the U.S. market experienced a 13 percent decrease, from 91,670 units to 79,815. The same study reports sales have dropped by more than 35,000 units since 2003.
Globally, snowmobile sales have dropped off 3 percent with Canada making up for the lackluster cumulative numbers with its 6 percent increase in sales, up from 42,953 units to 45,477 this year.
Speaking from ISMA headquarters in Michigan, Klim says the organization, with the collaboration of manufacturers and local chambers of commerce and tourism, is well aware of the sales situation. And while they obviously can’t change what Mother Nature has in store, they are making the marketing and broad appeal of snowmobiling a priority to an ever-expanding target audience.
One of the first things ISMA and its partners did was to gather as much information as possible on the new snowmobile rider.
“We have these new riders segmented,” Klim said. “We hired a research firm called Consumer Insights, which did a lot of focus group work, and numerous mail and phone and Internet interviews. They reached over 10,000 potential customers.”
Klim described the effort as thorough, one that has enabled ISMA to target households of potential buyers. The demographic specifics include an annual income of $50,000 or higher, outdoor enthusiasts who aren’t averse to winter recreation and engines, and those living in the northern parts of the U.S. or all of Canada. These filters have allowed ISMA to determine that there are close to 1.5 million households in the U.S. alone that fall into that category, most of which include married couples, which equates to nearly 3 million potential customers.
Just how realistic are these numbers for tapping into first-time snowmobile buyers?
“You wouldn’t call these low hanging fruit,” Klim said, “but these are people who are very interested.”
Although Klim wouldn’t say how much ISMA spent on the data, he did say that the money was well spent.
“It’s one thing to have good data and another to use good data to expand your market,” he said. “Now we know who the people are who don’t snowmobile, and how they view us. On a scale of 1-10 (with 10 being the best possible image of the sport) across the U.S. and Canada, it was an amazing average of nine.”
And just as amazing was the lack of knowledge from potential first-time buyers. Klim went so far as to say many in the focus groups knew absolutely nothing about the machines and users.
“They know snowmobiles exist, but don’t know how they work or the rules and regulations,” he said. “But the important thing is they don’t know the club or trail systems. I went to one focus group, and listened to people say, ‘We drive along XYZ highway in Minnesota, and all of a sudden we see 500 sleds at a station getting gas.’ I go ‘Yeah,’ and they look at you, and ask ‘Where’d they come from?’
“It was really an eye opener how little they knew. That’s when I knew we had a big task ahead of us.”
To diffuse the confusion and educate the nonsnowmobile population, ISMA created the Go Snowmobiling campaign, which started two years ago. Klim is confident the campaign is picking up speed and helping the sport reach the next generation of riders, mainly via loyal customer support and a grassroots relationship driven by area snowmobile trail builders. This focus, says Klim, is essential in understanding why people go snowmobiling, and if those reasons are effective for those who enjoy the sport, then hopefully it will relate to understanding better how it could apply to those who currently don’t participate.
“I believe we understand what needs to be done in the market,” he said, “and have strong buy-ins from chambers, visitors and tourism boards. They like the campaign, the ads and the stories of families enjoying snowmobiling.”
With the collective efforts from snowmobile manufacturers, ISMA has developed two campaigns thus far and has plans for a third. Klim was quick to point out that it’s the OEMs who are helping mold the program.
“They’re very supportive. They’re spending some money,” he said. “Of course you always want more, but they are committed.”
Klim says one of the challenges of the campaign is due to different types of trail terrain. Minnesota and to the east consists of mainly a trail riding campaign whereas out west, in Idaho, Montana and Colorado, this type of campaign “doesn’t work a hoot,” Klim said.
But ISMA and the manufacturers are committed to marketing to every demographic. To date, the Go Snowmobiling campaign is halfway through its testing and market research, and while he admits the effort could be moving at a faster pace, Klim enthusiastically adds, “the bottom line is that we’re moving along.”
When asked the somewhat rhetorical question of why he thought potential first-time snowmobile buyers weren’t rushing to the local dealer, Klim says it’s all about the snow, or lack thereof.
“It is the No. 1 barrier to entry,” he said. “People want a return on their investment, and right now first-time buyers aren’t even looking at the sport because they don’t even think they’d be able to ride them due to lack of snow.
“You can always say ‘there’s snow in the world,’ and real enthusiasts follow it,” says Klim. “But for the people just getting into the sport, that’s not something they’re going to do initially. They need to sled close to home. I think anybody that denies it is just not in the real world.” psb