Competition in the Golf Industry

An compend of Competition in the Golf Industry It is chartless when the game of play originated, plainly it is believed that people began play in Europe during the middle ages. In the fall in States, play was a sport primarily play by the wealthy individuals until tour invokents began being televised. Since then, golf game has braggy to be a very lucrative sedulousness with over 27 million golfers nationwide by the end of the 1990s. Competition in the Golf Equipment Industry, a case study written by jakes E.Gamble of the University of South Alabama, is an overview of the problems currently facing study companies in the golf equipment manufacture technical limitations (due to golfs governing organizations), a make up in the matter of golfers, and the economic recess, and the threat of counterfeit w ares. These limitations be causing leading competitors in the golf industry, videlicet Calloway Golf, to rethink their strategies in 2010. PLAC synopsis for Calloway Golf Ely Reeves Calloway younger , Calloways original owner, CEO and President, bought a manufacturing high society of hickory shaft wedges and putters in 1983.Calloway, originally cut back to reproducing antique golf clubs, has extended its carrefour fullness across the golf equipment industry. Calloway Golf now continuees drivers (with the doorway of Big Bertha), putters (with the acquisition of Odyssey), irons (designed to compete against Titleist), golf balls (with the acquisition of Top-Flite), footwear and clothes branding, and GPS units (with the acquisition of UPlay). analyse Timeline in Appendix 1. Calloway has differentiated itself from its competitors by its innovation, opening with the success of their driver, Big Bertha, which initiated the technology race among firms.Calloway and its competitors familiarize more innovative products every 12-18 months to remain competitive. Furthermore, Calloway has acquired some(prenominal) firms since its origination in 1983 in order to go ballistic its product breadth. Although in 2009, Calloway Golf Company was the second largest seller of drivers and fairway woods, revenues have declined by 17% in 2009 compared to the first six months of 2008. Challenges facing this firm exit be assessed in the SWOT analysis. SWOT Analysis for the golf industry, Calloway Golf & Recommendations See Appendix 2 for Matrix StrengthsCalloways expert innovation in making a driver that pushed the limits of USGA standards shows motivation to break the best. Marketing to recreational golfers in an attempt to assist them enjoy the game more by offer an opportunity to drive 6-10 yards further was a bench mark and pushed Calloways product to the best golf product of the century by a two-to-one margin. Calloways placeable let on also gives them a competitive edge. Weaknesses Although these technological advances whitethorn have boosted sales, in that respect is still undersized evidence that these advances help golfers l ower their scores.Another helplessness of the industry is sustainability. With the development of new products every 12-18 months, it is of the essence(p) that companies market their products and have strong sales abruptly after introduction. Also, a weakness with Calloways golf balls was their brand image with the acquisition of Top-Flite golf balls, which speedily coined the game Rock-Flight. Opportunities Although sales have declined 5. 7% during 2008, move merchandising efforts and remaining a household name could prove beneficial to all firms after the recession has subsided.Due to the recession, discretionary spending has declined and savings has shewn, but this could quickly change after a acquire in the economy. Furthermore, Calloway has lately cut their endorsements of PGA professionals to only encompass 10 mens PGA professionals and 5 women. If they grow these adds, it would give them more brand exposure and perchance higher revenues since many recreational golf ers base their decisions on the type of equipment successful, professional golfers are using. ThreatsThere are a number of threats affecting the golf industry as a whole effects of technological limitations by USGA, a decline in the number of golfers due to the economy and lack of leisure time, and the rise of counterfeiting. The state of the current economy paired with the decline in the number of golfers, has caused companies to focus more on price and volume. Counterfeiting is largely attributable to the decisions by executives to source for cheaper labor to manufacturers in China who can spend a penny a golf club for less than $3 per club. RecommendationsCompanies currently operating within the golf industry, specifically Calloway Golf, must change their current marketing approaches and strategies to stretch forth the recession and threats facing the industry. Although Calloway has a strong R&D department that tends to remain competitive with products and technology, there ha ve been little results in reference to scores. It is imperious that if companies are going to market a product that will help golfers drive further and straighter that the results envision this so that not to damage the brand name of a product.Secondly, due to the decline in equipment sales and the number of golfers, prices are dropping and companies are outsourcing to reserve the volume needed to remain competitive. Companies must be cautious and aware so that counterfeiting may be reduced. This reduction would also allow companies to reduce their price and have more sales without the competition of these stingily priced knock-offs. In the instance of Calloway, an increase in marketing and endorsements would boost their sales due to brand recognition. Calloway has recently fallen to second place in the pith of sales of drivers.In aiding in cutting atomic pile on counterfeiting, lowering prices, and increasing marketing and endorsements, Calloway may have the opportunity to re position themselves as number one in the marketplace. Appendix 1 Calloway Timeline 1983- Ely Reeves Calloway, junior purchased a 50% interest in a Temecula, California manufacturer and marketer of hickory shafted wedges and putters for $400,000. 1985-Ely Reeves Calloway, junior , hired aerospace and metallurgical engineers to design the most technologically advanced golf clubs. 1991- Introduction of Big Bertha 1996- learning of Odyssey (leading brand of putters)