Golf Equipment
CASE STUDY #4 1. What are the defining characteristics of the golf equipment industry? What is the industry like?
Even though golf had grown to be a sizable part of the U.S. economy, the golf equipment industry was faced with serious troubles in 2008. The convergence of a variety of serious hazards to the industry had caused the retail value of the golf equipment industry to decline from approximately $4 billion in 2000 to about $3 billion in 2003. Golf equipment sales had rebounded to an estimated $3.8 billion in 2007, but many threats to the industry continued to exist. The number of golfers in the United States had declined from 27.5 million in 1998 to 22.7 million in 2007. The number of rounds of golf played in the United States also had not grown since 2000 and had declined by 2.2 percent during the first six month of 2008. In addition, golf equipment manufacturers had become stifled in their abilities to pursue innovation-based strategies directed at making golf easier to play for those of modest talent.
2. What is competition like in the golf equipment industry? What competitive forces seem to have the greatest effect on industry attractiveness? What are the competitive weapons that rivals are using to try to outmaneuver one another in the marketplace? Is the pace of rivalry quickening and becoming more intense? Why or why not?
What is competition like in the golf equipment industry?
a) Technology Innovation
Beginning in 1998, golf’s governing organizations, the United States Golf Association (USGA) and the Royal & Ancient Golf club (R&A), put a series of new rules in place that limited manufacturers' abilities to develop more forgiving golf equipment. Manufacturers struggle to differentiate their products when everyone has the same technological limitations. The competition between the top leaders in most golf equipment categories has become intense.
Competitive rivalry in the golf equipment industry centered on technology innovations
Even though golf had grown to be a sizable part of the U.S. economy, the golf equipment industry was faced with serious troubles in 2008. The convergence of a variety of serious hazards to the industry had caused the retail value of the golf equipment industry to decline from approximately $4 billion in 2000 to about $3 billion in 2003. Golf equipment sales had rebounded to an estimated $3.8 billion in 2007, but many threats to the industry continued to exist. The number of golfers in the United States had declined from 27.5 million in 1998 to 22.7 million in 2007. The number of rounds of golf played in the United States also had not grown since 2000 and had declined by 2.2 percent during the first six month of 2008. In addition, golf equipment manufacturers had become stifled in their abilities to pursue innovation-based strategies directed at making golf easier to play for those of modest talent.
2. What is competition like in the golf equipment industry? What competitive forces seem to have the greatest effect on industry attractiveness? What are the competitive weapons that rivals are using to try to outmaneuver one another in the marketplace? Is the pace of rivalry quickening and becoming more intense? Why or why not?
What is competition like in the golf equipment industry?
a) Technology Innovation
Beginning in 1998, golf’s governing organizations, the United States Golf Association (USGA) and the Royal & Ancient Golf club (R&A), put a series of new rules in place that limited manufacturers' abilities to develop more forgiving golf equipment. Manufacturers struggle to differentiate their products when everyone has the same technological limitations. The competition between the top leaders in most golf equipment categories has become intense.
Competitive rivalry in the golf equipment industry centered on technology innovations