Team Exercise 4
Team Exercise 4
Why has Altius lost market share? 10 points
i) There was a decline in the economy, which led to less people spending money on golf. Now even during a modest recovery the industry is not nearly back to the glory of its past, and many golfers who stopped golfing are not returning, and few people are picking up the game for the first time. The declining interest created a major decline in spending. ii) Altius marketed itself exclusively as a premium brand. While other golf ball manufacturers has premium and discount brands, Altius had their Victor TX balls which where premium and older models of the very same Victor TX as their discounted brand, which brought in a substantial amount of revenue. iii) Big box retailers sold to 60% of the market and mostly casual golfers shopped there, not the golfers who would spend lots of money on premium golf balls and did so at the pro-shops. iv) Altius offered the lower end of profit margins to retailers, while their competitors offered the higher end of possible profit margins.
v) USGA introduced the Tee It Forward movement which made golf easier and more fun by increasing hole size, decreasing the number of holes played and increasing the number of children and recreational golfers. vi) Golf ball marketing strategies have changed, the ball the pros use is not necessarily the best ball for everyone. Altius has consistently marketed the Victor TX as the ball that helps the pros win big tournaments, while their competitors are helping golfers find the perfect ball for their specific game and skill set. vii) Non-conforming balls are introduced. These balls are not up to USGA standards but make golfing easier by reducing slicing and hooking the ball. These balls were always shunned by the sport and marketed as though the golfer was cheating, are now being marketed by an Altius competitor with subdued marketing so that golfers can use these balls without making it obvious.
Why has Altius lost market share? 10 points
i) There was a decline in the economy, which led to less people spending money on golf. Now even during a modest recovery the industry is not nearly back to the glory of its past, and many golfers who stopped golfing are not returning, and few people are picking up the game for the first time. The declining interest created a major decline in spending. ii) Altius marketed itself exclusively as a premium brand. While other golf ball manufacturers has premium and discount brands, Altius had their Victor TX balls which where premium and older models of the very same Victor TX as their discounted brand, which brought in a substantial amount of revenue. iii) Big box retailers sold to 60% of the market and mostly casual golfers shopped there, not the golfers who would spend lots of money on premium golf balls and did so at the pro-shops. iv) Altius offered the lower end of profit margins to retailers, while their competitors offered the higher end of possible profit margins.
v) USGA introduced the Tee It Forward movement which made golf easier and more fun by increasing hole size, decreasing the number of holes played and increasing the number of children and recreational golfers. vi) Golf ball marketing strategies have changed, the ball the pros use is not necessarily the best ball for everyone. Altius has consistently marketed the Victor TX as the ball that helps the pros win big tournaments, while their competitors are helping golfers find the perfect ball for their specific game and skill set. vii) Non-conforming balls are introduced. These balls are not up to USGA standards but make golfing easier by reducing slicing and hooking the ball. These balls were always shunned by the sport and marketed as though the golfer was cheating, are now being marketed by an Altius competitor with subdued marketing so that golfers can use these balls without making it obvious.