Technology: The Lifeblood Of Callaway Golf Company
When it comes to the factors contributed to Callaway Golf Company’s success, the tremendous effort it made on updating technology was one thing. With Senior Executive Vice President like Richard Helmstetter, who is the Chief of New Products as well, Research and Development has always been the lifeblood of Callaway Golf Company (CGC). Helmstetter believes that “If you can make something sufficiently good, what it costs doesn’t matter.” CGC was consistently be on the leading position of technology, which differentiated their products from others and led to the results that CGC sold more units of equipment at the higher price than any other of its competitors in the market.
The consumer behavior in golf equipment industry was another factor
that led to CGC’s success. First, golf was unlike almost any other sport, the equipment played a significant role in golfer’s performance. Therefore, golfers always seeking for an edge that would help improve their plays. Average golfers, who were the segment CGC targeted, were able to tell the noticeable differences when they used premium equipment. The advanced technologies CGC had with their products perfectly fitted the behavior. Second, when making a purchase, most golfers accepted word-of-mouth recommendations. The form of advertising worked for CGC since golf was played in groups of people who spent hours together, and whenever one player had a good shot with a new club, it impressed others.
The last factor that contributed to CGC’s success was the support mechanisms it provided to its retailers. As CGC achieved product differentiation with continuously updated technology, it was important for retail salespeople to understand the product and technology well. To accomplish the goal, CGC supplied its retailers with brochures, informational videos, pocket-sized product guides, and training. CGC also provided product advertising, endorsements, warranty programs and most importantly, the closeouts to help its retail channels. Closeouts occurred when a new-product introduction or when CGC would like to get rid of its inventory and it helped the retailers to bring down the average cost of the remaining inventory as well. As a result of these support mechanisms, CGC was placed in top three for excellence in customer service.
The consumer behavior in golf equipment industry was another factor
that led to CGC’s success. First, golf was unlike almost any other sport, the equipment played a significant role in golfer’s performance. Therefore, golfers always seeking for an edge that would help improve their plays. Average golfers, who were the segment CGC targeted, were able to tell the noticeable differences when they used premium equipment. The advanced technologies CGC had with their products perfectly fitted the behavior. Second, when making a purchase, most golfers accepted word-of-mouth recommendations. The form of advertising worked for CGC since golf was played in groups of people who spent hours together, and whenever one player had a good shot with a new club, it impressed others.
The last factor that contributed to CGC’s success was the support mechanisms it provided to its retailers. As CGC achieved product differentiation with continuously updated technology, it was important for retail salespeople to understand the product and technology well. To accomplish the goal, CGC supplied its retailers with brochures, informational videos, pocket-sized product guides, and training. CGC also provided product advertising, endorsements, warranty programs and most importantly, the closeouts to help its retail channels. Closeouts occurred when a new-product introduction or when CGC would like to get rid of its inventory and it helped the retailers to bring down the average cost of the remaining inventory as well. As a result of these support mechanisms, CGC was placed in top three for excellence in customer service.