Golf Ball Industry Essay

1928 words - 8 pages

Golf ball industry Golf is a multi-billion dollar industry that is showing a growth in popularity due to media attention on rising young stars of the sport. Many different golf products are needed and sold to the millions of consumers who play this sport annually. Because of the large market which exist, there is strong competition between equipment makers to get their products sold. Of the equipment that is needed to play a round of golf, clubs and balls are the most essential. More notably is the fact that clubs have a longer useable life than golf balls. New golf balls may be needed every time a golfer goes to the course to play a round. This is because balls get lost or scuffed during play. The high sales turnover which exists with golf balls makes this product attractive to sports equipment producers. The purpose of this report is to identify the major competitors of golf ball manufacturers and the size of their market share; Also, this report intends to show the current marketing programs used by these manufacturers, the profile of the golf ball market, and the current trends affecting the industry. By conducting this research, it may become apparent as to what it would take to penetrate and succeed in the golf ball industry, what type markets exist, and how much potential revenues exist. This research should provide enough information to understand the basic structure of the golf ball market. One question which this research would like to answer is: Is there room for a small business competitor? According to an industry survey conducted by Standard and Poor's, golf product sales grossed approximately $3.9 billion in 1996 (5). Of these sales, $789 million dollars were spent on golf balls. Standard and Poor's also claim that this industry is expected to grow at least by 5% a year due to increased prices of premium products and because of increased participation rates due to emerging young stars like Tiger Woods. It has been estimated that around 25 million people in the United States play golf. As seen in Table 1, golf participation rates took a dip after the early 90's, however, the rates now show a positive growth trend (Golf Perspectives). TABLE 1- Golf Participation While Table one shows that women's participation rates have declined, Standard and Poor's have reported that there is a positive trend and that more women are golfing (7). Due to the large success and media exposure of Tiger Woods, who is a young African-American, it can be assumed that more youths and minorities might also start playing golf. While the industry is growing, so is the competition. The article by Brandweek, "Big Time Wars in Golf Balls Drive Still-Thriving Industry", claims that there are more ball manufactures than ever that are making a mark( 30). While this may be true, there are four companies which dominate and control a large portion of the market share. Figure 1 shows the sales of the leading golf...

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