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Tuesday, Jul 23, 2024
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Lead Golf manufacturers stay the course, focus on future

Consumers in the golf industry shouldn’t be expecting any surprise moves in how manufacturers approach them this year.

However tragic, the Sept. 11 terrorist attacks on the East Coast might not impact the industry as much as one would think, said Tim Conder, an analyst for A.G. Edwards.

“One thing is that we’re at the end of the golf season, so you’re kind of in the off-season for the industry,” Conder said.

However, the upcoming months will tell the real story, he said.

“If things stay sluggish the first half of next year, which will be the majority of next year’s golf season, you will see consumers gravitate toward more price-point items,” he said.

If so, it could be a difficult year for producers of clubs and higher-end iron items, Conder said.

“The only reason I say this is this year, the industry produced a lot of woods products relative to irons, so you had more new woods offerings in the market relative to irons. Next year will be an irons year.”

How a war effort could affect consumers will likely depend on decisions made by the U.S. government, he said.

“It depends on what actually unfolds here,” he said. “What we do and what countermeasures are taken. There are a lot of unknowns.”

Conder’s projections: “You’ll see a flat to slightly down year.”

He said golf balls will cost in the mid-$20s per dozen.


– Staying The Course

For Chris McGinley, vice president of marketing for Carlsbad-based Titleist’s golf ball business, the industry’s own results in recent years indicate the direction customer outreach should take.

“It’s very competitive out there right now, and the economy’s not good, and the golf economy hasn’t been good … the industry hasn’t grown much in the past few years,” McGinley said. “We want to make sure that every single dollar we spend is well targeted.”

Look for the company to stick with what’s worked for them in the past, he said.

McGinley describes one part of the company’s marketing plan as a “seeding effort.”

He said the effort involves getting Titleist products in the hands of what the company considers “shepherd” players.

He describes them as “guys who because of their playing ability, influence a lot of other people.”

Tour players are the first contacts for the marketing plan. From there, the company wants to create a trickle-down effect, with better amateurs and serious golfers, McGinley said.

At TaylorMade-adidas Golf, also located in Carlsbad, executive Robert Erb echoed companies’ thoughts that in general, the safety of employees and people came first.

Erb, vice president of global marketing and chief legal officer, said there has been some concern about the effect of the terrorist attacks.

“Anytime you have a significant emotional event on the scale that we’ve seen, you face a downturn in business,” he said.


– Unique Position

However, golf is often considered to have a unique position in the industry.

“In terms of the economy, we’re confident that golf is one of the few sports that is not really perceived by the people who play it as being ‘leisure,’ that it’s part of their way of life.” Erb said.

“I suspect that the retail community will find that they recover rapidly and that the same will continue because it’s a very social game in which people interact and meet and discuss business,” he continued.

McGinley agreed. In the past, it was often held that golf was almost “recession-proof,” he said.

“It’s funny, because historically, as you go back in times of softer economies or unemployment, the golf industry hasn’t necessarily suffered,” he said. “That may speak to the demographics of who’s playing golf now.”

Whether that’s going to hold true now remains to be seen, McGinley said.

“We’re dealing with a unique set of circumstances because not only is the economy soft, but now you have a crisis thrown in there on top of that.”

McGinley continued, “I think the industry feels confident that the game is somewhat recession-proof , but whether it’s recession- and crisis-proof, I don’t know.”


– Recovery Expected

Although he didn’t give further details, Erb said there had been a “slight drop” in TaylorMade’s business in recent weeks.

However, he said, “We expect it to recover by Christmas and particularly if action is taken immediately by the government,” he said, referring to the U.S. leadership’s response to the terrorist attacks.

TaylorMade plans to continue with its current marketing strategy, which includes the Internet, local staff programs, local hero programs, a supervisory board of golfers, horizontal and vertical media buys, and remaining active at tournaments.

Another program has been a grass-roots approach in which product demonstrations were linked to BMW automobiles.

The cars became point of sale material, and a showcase for the new products, Erb noted.

According to independent studies that measured pre- and post-brand perception, the programs succeeded, he said.

According to Erb, media buying is unlikely to be a challenge.

One result of the terrorist attacks was that a lot of companies pulled or cut back advertising tremendously, leaving room and perhaps better pricing for current advertisers, he said.

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