Callaway Golf Company Case Analysis Essay Example
Callaway Golf Company
1.) The defining business and economic characteristics of the golf equipment industry can be measured by looking at the makeup of the industry itself. The case states that there are approximately 26 million Americans who play golf. 5.4 million play at least twice a month. These numbers are expected to grow by 1 to 2 percent a year until at least 2010. Of the U.S. golfers, 25% are seniors, 5.7 are women, and 2.1 million are juniors. The typical golfer is a 39 year old man who earns about $66,000 annually. Golf has also started to expand globally with 16 million and 2 million golfers in Asia and Europe respectfully. In 1999, the golf equipment industry took in about $2.7 billion in wholesale sales (2nd only to exercise equipment in the sporting goods category). This is slightly lower than the $2.8 billion from 1998.
2.) The golf equipment industry can be broken into two competitive groups: low-end and high-end manufacturers. The low-end manufacturers include Spalding, MacGregor, and Dunlop. These manufactures mainly sell there equipment in department type stores, for really amateur players. The high-end manufacturers include Callaway, Taylor Made, Ping, Orlimar, and Titleist. These manufacturers sell "pro-line" equipment, usually at pro shops. Probably the strongest competitive forces for the high-end manufacturers are the quality/performance of their products and also the promotion of their products. Each company is trying to capture as big a share of the market by producing high quality golf equipment. Each company has invested large sums of money on technology to develop the best possible clubs. They have also spent millions on promoting their products in magazines, displays, and endorsement deals with top professional players. I believe one weak competitive force for the golf equipment industry is price, at least for the high-end manufacturers.
3.) The drivers or key factors that cause the golf club manufacturing
1.) The defining business and economic characteristics of the golf equipment industry can be measured by looking at the makeup of the industry itself. The case states that there are approximately 26 million Americans who play golf. 5.4 million play at least twice a month. These numbers are expected to grow by 1 to 2 percent a year until at least 2010. Of the U.S. golfers, 25% are seniors, 5.7 are women, and 2.1 million are juniors. The typical golfer is a 39 year old man who earns about $66,000 annually. Golf has also started to expand globally with 16 million and 2 million golfers in Asia and Europe respectfully. In 1999, the golf equipment industry took in about $2.7 billion in wholesale sales (2nd only to exercise equipment in the sporting goods category). This is slightly lower than the $2.8 billion from 1998.
2.) The golf equipment industry can be broken into two competitive groups: low-end and high-end manufacturers. The low-end manufacturers include Spalding, MacGregor, and Dunlop. These manufactures mainly sell there equipment in department type stores, for really amateur players. The high-end manufacturers include Callaway, Taylor Made, Ping, Orlimar, and Titleist. These manufacturers sell "pro-line" equipment, usually at pro shops. Probably the strongest competitive forces for the high-end manufacturers are the quality/performance of their products and also the promotion of their products. Each company is trying to capture as big a share of the market by producing high quality golf equipment. Each company has invested large sums of money on technology to develop the best possible clubs. They have also spent millions on promoting their products in magazines, displays, and endorsement deals with top professional players. I believe one weak competitive force for the golf equipment industry is price, at least for the high-end manufacturers.
3.) The drivers or key factors that cause the golf club manufacturing