Over the last decade the number of people riding motorcycles has dropped sharply. In 2006, 1.1 million motorcycles were sold; last year just over 470,000 motorcycles were sold.
As a result some motorcycle manufacturers are struggling... but due to a savvy turnaround, one area of the broader motorcycle industry is growing at an extremely rapid rate.
American Flat Track (AFT).
If you aren't familiar, flat track racing -- the only form of motorcycle racing that originated in the U.S. -- involves sliding technologically-advanced motorcycles on unpaved ovals at speeds of up to 140 miles per hour -- with only a rear brake.
And if that explanation didn't help, check this out.
Previously known as AMA Pro Flat Track, in the three years since the sport was rebranded AFT has gone from 193,000 total season fans (live attendance and FansChoice.tv viewers) to over 2.6 million (and counting) in 2018. 30 percent of first-time attendees at an AFT race are between the ages of 25 and 34 -- which is basically the opposite of the motorcycle purchase demographic.
Today, the sport has more manufacturers involved. And more sponsors. And more fans. The revival of this grass-roots, blue-collar form of racing is a great story.
I asked Michael Lock, the CEO of AFT, to explain the strategy behind the sport's turnaround.
Studies show a 50 year-old entrepreneur is twice as likely to start a successful business as a 30 year-old. Clearly experience matters. So let's start with yours.
Years ago I came from England to the U.S. to set up Triumph America, to establish the dealer network and establish the brand in the marketplace.
Then Ducati UK asked me to run their North American operations. I had U.S. experience. They were struggling here. They didn't know why.
I did that for ten years as we turned that business around and helped make it what it is today. Then after a brief stint in the electric vehicle space I ended up running U.S. operations for Lamborghini.
Wait: Does that mean you got to drive a Lambo home every day?
(Laughs.) Not every day... but yes.
I didn't love the car business, though. I loved the products, loved the marketing, loved the events... but the car business is bigger, more political, more dog-eat-dog.
I had spent 20 years working around motorcycle people. They're amazing people. They love motorcycles. They have to. You can do well, but you don't get rich in the motorcycle business.
One of those people is Jim France (currently the acting CEO of NASCAR). I had known JIm for years. Flat track is the apple of his eye, and he asked me to take a look as a consultant to see how it could be turned around and scaled.
I presented a report to Jim and the board about what their future needed to be and they said, "Let's do it."
And then they said, "And by the way -- you should do it." (Laughs.)
Clearly you like turnarounds.
What motivates me is leaving something in better shape than I found it. When people say, "That won't work," or, "This won't work," that always gets my attention.
If the product or brand or idea is good, you can make it successful. Of course you can also turn a product or brand that isn't good into a success... but doing that doesn't interest me.
Taking something that, at its core, is unique and has value, and removing the barriers so it can be scaled into something successful... I've always loved doing that.
Flat track definitely fell into that category.
I remember when flat track racing was huge in this country. People like Kenny Roberts, Freddie Spencer... they cut their teeth on flat track, and then went on to be world road racing champions.
That's actually when the decline started. If you're Kenny Roberts, why wouldn't you go to Europe, race Grand Prix motorcycles, and make more money? Freddie, Eddie Lawson, Wayne Rainey... there was a constant supply of talent. In Europe, we thought the American dynasty would never end. Those guys learned their craft in flat track. That gave them an edge... and they were never coming back to flat track.
The second generation of talent loss happened in the 1980s when motocross and Supercross became huge. Flat track racing lost stars, lost manufacturers, lost glitter... and lost fans. Plenty of people concluded it would just go gently into the night.
So what did you see that others didn't?
When I sat in the grandstands at a few races I saw a number of things that made the sport unique: A blue collar, authentic American scene, close camaraderie, a real sense of community, a genuine respect for the heritage of the sport... those things are pure gold.
And then I saw the motorcycles on the track. Seeing riders racing in packs, throwing their motorcycles sideways, with no front brake... it takes your breath away.
Add up the storytelling possibilities, the imagery, the wild action that, unlike on a road course, you can always see everything that happens....
Plus, with flat track we had an "ancient" sport perfectly suited for today: Short races that create bite-sized pieces of action creating a number of short stories that stitch together to create an exciting whole...
I felt we could capture the genie of the past but with a modern sensibility, all the while telling the story of these kids from towns you've never heard of.
Flat track is America: Rich storytelling, high energy, and optimism about the future.
So where did you start the turnaround process?
First, we changed the name. Then we created a simplified class structure so you wouldn't need a PhD in motorcycles to understand it.
Then we needed some help and some muscle from big manufacturers like Indian and Harley to support us on the track as well as off the track with promotion.
That opened the door to a conversation with NBC about televising the sport. Even today television matters, and NBCSN is a high-energy growing channel. When NBC said they were interested, and when NASCAR Media services said they would help with production... then I knew we really had something.
Changing the infrastructure of the sport can't have been smooth where your primary constituents, the teams and the riders, were concerned. How did you work through that?
The key was having a clear path and a simple story to tell. We said, "Folks, we're going to make you famous... but you need to do something for us. When we come out with a new rule book, don't roll your eyes. Help us."
Our riders and teams have totally responded to the challenge. This was a small sport, one naturally suspicious of new players and new ideas, but they've seen the path and they embrace the role the play: How they carry themselves, the fact they are role models to younger riders... Almost nothing is the same as it was three years ago, and the teams definitely embrace that.
Was getting the manufactures involved the real key?
Getting the manufacturers more involved was a major step in gaining credibility. But it also provided resources. When a manufacturer comes to AFT, they don't just bring hardware. They bring skills: Software engineers, suspension engineers, technicians...
And they demand more from the riders: Controlled training, controlled fitness and diet, more testing, more feedback... they expect the riders to be totally focused, and the results prove the power of that approach.
That also has a trickle-down effect: In 2016 there were three Harley riders and three Indian riders. The next six below were thinking, "I could be that guy or gal." And the six below them were thinking, "Hey, there's opportunity in this sport..."
I'm sure the credibility boost helped smooth the way for changing the class structure.
You're right. The second pillar was the modernization of the class structure. Now we have AFT Twins and AFT singles. They're the same bikes every week, regardless of the track.
That simplified the sport not only for fans for also for constituents.
But we did have to work through some objections. Whenever you change a fundamental of a business, the objections often come from something that happened 30 years ago. For example, some thought if 450cc bikes operated at maximum performance throughout a race their engines would blow.
Maybe that was true 30 years ago. Today the manufacturers have poured millions of dollars into developing those engines. They can run at top speed seemingly all day long.
Also keep in mind the AFT Singles class is no longer a stepping stone. The class is so successful some factory teams and riders "drop down" to race there because the racing action is so good.
So getting the manufacturers involved, and then simplifying the classes to make the sport easy to understand.... that made the TV deal possible.
Let's go back to your original presentation to the board. What did you do differently than you proposed?
I looked at that PowerPoint presentation not long ago. It's like a complete blueprint for what we're doing now in terms of overall substance. The time frames are different... but the steps are identical.
Did that surprise you?
Not really, because the strategic plan wasn't complicated: Stop doing these things, start doing these things, shift these resources....
The board didn't want minutiae. They wanted a clear direction, a way to measure improvement... a simple and open plan.
We've added layers since then, but the plan is basically the same.
I helped lead a manufacturing plant turnaround and realized the simpler the plan, the better for all.
After I left Triumph I went back to college and did a full-time MBA. I learned some information and processes, but most importantly I learned a method of thinking.
- Do your thinking first.
- Break it down into bite-sized pieces.
- Put those pieces in a way you can communicate to others, and get their buy-in.
The key is to break things down so you can explain them to other people so they will say, "I see that. I can do that."
And then add measurements to help you gauge progress.
How did you apply that to you time at Lamborghini?
Lamborghini had an amazingly famous brand, but one with an image problem. We needed to keep the glamour -- and lose the cocaine dealer connotation.
It's funny you say that, because that Sonny's car was a Ferrari... but people still associated the image with Lamborghini.
That was a delicate conversation to have with the Italians. (Laughs.) I had to think hard about how to communicate where we wanted to go so I could get their buy-in.
When you present an idea or an argument people don't understand, you're pushing water uphill.
That's the philosophy we employed when we turned AMA Pro Racing into AFT. We had to get buy-in for a collection of ideas -- some of which sounded crazy, others that they may have thought they had tried before -- but when you get buy-in, the tension goes down and the energy goes up.
That's my advice for anyone trying to turn around a business, product, or a brand.
Tell yourself the story first. Work on it until you can tell yourself a story that energizes you.
Then you have a shot at energizing and engaging other people.
Since the ultimate goal is engaging fans, who do you see as your typical audience?
Oddly enough, we have two basic types of fans.
One buys a ticket to races. We'll sell about 125,000 tickets this year. That customer typically rides a motorcycle, usually American-made, probably a Harley, and is a Baby Boomer with an 85 percent chance of being a white male.
In contrast is our digital customer who watches the streaming broadcast for free on FansChoice.tv. That customer is somewhere between 18 and 29 years old, at 70 percent still predominately male but less so. They may or may not ride a motorcycle but are interested in outdoor sports and extreme sports. Eighty percent are U.S. residents, and 20 percent are international.
We anticipate a sizable shift in audience 5 years from now. We're totally innovating the events: Creating kid's zones, having live music, food courts, craft beer, third-party entertainment... we're changing the atmosphere to make it more inclusive and more family friendly.
People do things now as families. Society is different and we need to adapt as our demographic continues to evolve.
We want to grow our international audience. And we want to bring our digital fans to events to show them what they're missing.
In the meantime I want our existing fan base to think, "Hey, I should bring the grandkids."
Because they should -- the grandkids will love it.