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Where is the industry going?

limpalong

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Had quite a visit with my buddies at GG last night. Excellent discussion... no answers. So, thought I'd troll for input from some of you.

Where is the industry going? Lots and lots of new releases. Mizzy, Ping, Titty, TM, Adams... the new sticks are being released and hitting the shelves. Due to the economy, the current stuff isn't selling. What will happen with the new releases?

The new Cally FT-iQ will surely be a $500 driver. The new Ping Rapture will retail close to $500. There's bound to be a TM Burner Limited TP that will see the $500 mark for at least 6 or 7 days!! The new Cobra L5V will go for well over $400.

TM's are being reduced daily. $299 Burners are now $199. $399 SuperQuads are $229. Adams drivers were released at $299, but didn't even get to the rack before being reduced to $169. Titty D1's and D2's are being marked down a hundred to a hundred and a half. ECCO golf shoes GG rec'd last Friday were discounted $70 bucks/pair yesterday. And, at these mark-down prices... stuff is still not selling!!

GG's club repair business is booming. More regrips and reshafts than they have seen since opening this store. Pre-owned sales stay level. The bottom has fallen out of the sales of new merchandise. Staff numbers are being cut because people just aren't walking through the doors.

Is it the economy? That has to be a major player. Is it the industry? Is there just nothing "new" and everything looks like a repackagiing of last year's models? Is it the sport? With TW's long layoff and moving a large percentage of tourney coverage to TGC, have people lost interest?

What, in your opinion, are the largest contributory factors to the current state of the golf equipment industry? What, in your opinion, will it take to see a revitalization of the industry? Will the industry ever be back to the hype of the '90's? Or, should we be giving up our own sticks and replacing them with checkers or ping pong paddles??
 

slickpitt

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Aug 15, 2006
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It's the economy... simply put... the middle class is struggling and don't have the money to spend. The poor never had it to spend to begin with... the rich, well, they have money so they aren't gonna change their spending, so retailers aren't losing anything here. So you're left with the middle class, AKA the majority. When we have money we spend it... when we don't, we don't.
 

David Hillman

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Apr 15, 2008
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Is it the sport? With TW's long layoff and
moving a large percentage of tourney coverage to TGC, have people lost
interest?

It's not that. There are people all over the golf courses.

There's very little ROI on buying new golf clubs in the first place, especially if you are replacing perfectly functional ones. Almost everyone has a little less coin laying around, so it shouldn't be surprising that fewer people are splurging on those luxury items.
 

warbirdlover

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Thank God Ping makes all their money on aerospace. And you'll notice Ping stuff is not discounting probably because they're selling like hotcakes because they work.

Flooding the market with a new driver every month HAS to come back and bite you eventually. What if the automakers did this?

I think you'll see new product lines STAY new for more then one year eventually. Like Ping... :D
 

ManchesterGolfer

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Jan 4, 2006
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It's just the end of the season and the end of line stuff always gets putt on sale before the new gear hits the Shops. The Titty D1, D2, Ping Rapture & the Cally FTi and FT5 have been out a couple of seasons so they are due to be replaced. The sales of the new stuff may not sell as well as they normally would due to the Banking problems but I'm pretty sure all the new stuff was due out anyway and hasn't just been released in responce to the economy's problems. Although thinking about it they normally don't hit the stores until the Spring so maybe they've released the new stuff in time for Christmas to try to boost sales?
 

FATC1TY

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May 29, 2008
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It's just the end of the season..
That and holidays hitting. Everyone will be discounting during the holiday season anyways.

New stuff comes out, they'll market it, mark it down, sell it cheap, and then start over.

The economy is hurting, but I don't think most are grabbing new clubs every week to test out and then eating the 50-$200 loss they normally swallowed and moved on with in the past.

Used clubs are selling like hot cakes. Golf courses are busy..

It's just the normal up and down, and it only seems like struggle.. Because if you go into a store now, it's red clearance signs up everywhere for stuff that came out 4-6 months ago..

Great deal for those of us who can't help ourselves. :)
 

chemboy2

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It seems like there is a perfect storm going on right now with seasonality (discounting for the holidays/new model year) and the economy. As others have already mentioned, golf is mostly definitely a "luxury" want and not a necessity and so it will always be at the top of the cut list whenever folks are cutting costs.

I'm not sure how much the constant product releases play a part. I wouldn't be surprised if all the top selling new gear are last year's models. The technology isn't changing that drastically year over year and folks could simply be tired of the marketing hype; tired of shelling out that ever dwindling discretionary spending money especially for something they know will be 100-200 bones less in just a few months.
 

warbirdlover

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Well, speaking in terms of a manufacturer, it costs money to develop new products. The engineers/designers, draftsman, casting or forging dies, marketing materials, all have to be part of the product cost. If this product is only at normal price for a short time, there is only (maybe) a "break even" end result with no profits. No profits (or maybe even losses) eventually means no company. :)
 

joshtpa

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Jul 7, 2008
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The industry will end up being just fine. But with an economy the way it is right now, $500 drivers just are not selling.
 
OP
limpalong

limpalong

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No profits (or maybe even losses) eventually means no company. :)

A few months ago, there was a rumor that Cleveland was being purchased by Srixon. Will the 3 big Asian companies... Bridgestone, Nike, and Srixon begin an acquisition path that could include the likes of Titty, Mizzy, Tour Edge, and... perhaps... even Callaway?
 

joshtpa

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Jul 7, 2008
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Nike is not an Asian company. Yes their products are manufactured there (so are tons of others) but Nike is US owned and operated. And Titleist is owned by Acushnet which is owned by one of the larger companies around. Fortune Brands is not selling them anytime soon.
 
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limpalong

limpalong

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Nike is not an Asian company. Yes their products are manufactured there (so are tons of others) but Nike is US owned and operated. And Titleist is owned by Acushnet which is owned by one of the larger companies around. Fortune Brands is not selling them anytime soon.

Yes, you are completely correct! I misspoke. Nike IS based in Oregon. And, as you say, most all golf equipment manufacturers do have their components made overseas. Ping still casts some of their own product in the U.S., but they're the exception.

Rumors have circulated for some time that Fortune Brands would consider a viable offer for Acushnet (Titleist/Cobra). The ball business has become much more competitive. And, the recent litigation that did not go their way may even cut into their ball business.

Over the past few years we've seen Cobra picked up by Achusnet. We've seen Spalding and Hogan picked up by Callaway. My point being that we could see some more acquisitions and even less options to choose from as there is less demand.
 

joshtpa

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Jul 7, 2008
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Fortune Brands will ABSOLUTELY NOT sell Acushnet. Footjoy and Titleist are far too profitable. Fortune Brands is one of my biggest clients and I assure you, they are in acquisition mode, not the other way around.
 

Wi-Golfer

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Who the hell would ever pay full retail for a club, especially a driver? Wait a couple months & get it for half the original price. Plus & let's be honest here, unless your current clubs are broken or 15+ years old, they will work just fine for 99.9% of us hackers. We buy new clubs because we want them, not because we need them.

As a result of the lousy economy, high gas prices, soon to be high home heating bills again, etc, folks will use the extra $$ if any to pay bills or maybe go out for an extra rd or 2 instead of buying yet another in a long long line of clubs.
 

joshtpa

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I paid full retail for almost every club in my bag. Yeah, Im that guy I guess. But I hit it, I liked them, and because of that, I bought it. It may not be for everyone, but Im a club ho.
 

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