Callaway Golf Case Anaylasis

June 28, 2018 Marketing

Strategic Planning Callaway Golf Mission Statement: “Callaway Golf Company is driven to be a world class organization that designs, develops, makes and delivers demonstrably superior and pleasingly different golf products that incorporate breakthrough technologies, and backs those products with noticeably superior customer service. We share every golfer’s passion for the game, and commit our talents and our technology to increasing the satisfaction and enjoyment all golfers derive from pursuing that passion. ” (CallawayGolf. com) Callaway Golf Company is most well-known for their development of the Big Bertha.

The production of this club made the driver go from a golfers least favorite golf club to being a club that every average and professional golfer needed in their golf bag. CGC was able to develop and innovate such superior products such as the Big Bertha because they had a very knowledgeable and committed staff of technicians and designers. Technology and the innovation of golf clubs is what put CGC at the top in the golf industry but their such frequent development of new clubs on the market is now back firing and hurting their sales. Marketing Myopia

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Ely Callaway founded Callaway Golf Company in 1982 and they marketed and developed high-quality innovated golf clubs to not just professionals but to average golfers as well. Ely Callaway’s vision was: “If we make a truly more satisfying product for the average golfer, not the professionals, and make it pleasingly different from the competition, the company would be successful. ” (Harvard Business School) Callaway’s vision worked perfectly in the 80’s and up into the 1990’s but over the last several years the golf industry has changed and the sales of Callaway golf club’s has declined.

Callaway’s aim is to “Deliver the best performing products, products of which perform so well that they will literally put the joy of the game in your hands. Because the thrills of golf are out there and because we believe everyone with passion for the game deserves the confidence to go out and experience them. ” (Callawaygolf. com) Callaway is delivering this message to every player from the average golfer to a professional but they have one problem that is setting the average golfer back from experiencing the passion and thrills of golf.

With hard economic times in today’s day in age the average golfer is less willing to spend so much money on a premium priced golf club such as Callaway. The average golfer that I keep referring to is described as someone who golfs a minimum of 10 rounds per year, usually has a handicap of about 18, and buys new golf clubs every two to three years. (Harvard Business School) I think that Callaway has put more of their focus on staying on top in the golf industry and developing new products as fast as possible that they have forgotten the key aspect in how they became such a successful company.

CGC has gotten away from satisfying every golfers’ needs. A golfer wants a reliable club that exceeds their expectations when they play. With CGC putting new clubs on the market so fast, they may leave the customer second guessing about how the quality is of the golf clubs that they just recently purchased and there clubs that are now discontinued. CGC needs to change their marketing plan and focus more on what kind of golf clubs golfers want in their bag to have the best experience while playing. Customer Loyalty

When CGC first started becoming successful they met the needs of every golfer from the average player to the professional. They had many loyal true friend customers that bought their clubs time and time again. A true friend customer is loyal as well as profitable to the company and CGC’s true friend customers have been fading over the last several years and they are turning into butterflies or barnacles. CGC is a top golf club developer but they are most well known for their driver the Big Bertha series. If a golfer wants the best of each different type of club, they might only buy a CGC driver or a putter.

If a customer bought just a select few of clubs from CGC they would be considered a butterfly to the company. If CGC would offer discounts on entire packages of clubs and maybe even add free apparel, this may secure true friend relationships with customers like they had when the company was first established. Another problem has occurred for CGC and that has to deal with the rapid development of new clubs on the market. Producing new clubs at such a fast pace may leave customers feeling uncertain of their clubs or other golf equipment that they have just purchased recently from CGC. Business Portfolio Analysis

CGC still to this day remains a powerful and successful player in the golf industry even though their sales have dropped 17% since 1998. The economy in the last several years may be a large contributing factor to the decline in sales as well as golf becoming more of a leisure sport. Even if their sales have dropped the Callaway name and products remains a powerhouse in the golf industry. Product and Market Expansion The Callaway Company should start selling the products they are already developing to a whole new market of customers and focus on expanding these products to different buyers.

With a struggling economy and the industry of golf declining, people are less willing to spend money on a sport that has shifted from a more competitive sport to more of a leisure one. CGC should shift their focus to a market of people who have the time and the money to afford premium priced golf clubs. They should also focus more on the women who are not being advertised enough too. Women make up half of the population so it would only make sense to try and make golf be recognized as both a man and women sport, which would increase the sales of

Callaway golf clubs and merchandise. There are risks involved in advertising to a new market of customers. This decision could possibly end up being a loss and CGC could end up with a loss in profit because they spend millions of dollars advertising to customers and if their new market customers don’t buy Callaway clubs they will not make that money up in sales. In the end CGC may not be doing anything wrong with their marketing scheme but that the only reason for loss of sales is the declining industry of golf as a whole.

No matter what decision or route Callaway Golf Company may take to increase their sales there will always be risks involved but without risks there are no rewards. Works Cited “Callaway Golf – Golf Company | Golf Equipment | Golf Clubs. ” Callaway Golf – Golf Company | Golf Equipment | Golf Clubs. N. p. , n. d. Web. 28 Sept. 2012. <http://www. callawaygolf. com/global/en-us. html>. Lal, Rajiv, and Edith D. Prescott. Callaway Golf Company. Boston, MA: Harvard Business School, 2005. Print.

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