Addressing the needs and wants of CGC consumers, Callaway customers all need one thing in common, a tool to hit a little round ball into a small hole. Callaway customers want a more pleasurable way to do it. Callaway has spent a lot of time, energy and resources finding how. The professional golfer wants long irons where most other golfers prefer short irons because the short staff makes it easier to use (Callaway Golf Company Information). The research and development group cost increased from 6 million to 37 million in a matter of 10 years.
According to the Callaway website, their mission is "Putting the Joy of the Game in Your Hands." Callaway needs to follow this statement throughout the chain of distribution. The company may believe in their mission, however if the retailers do not feel as if they are a respected part of that chain, the consequences will result in decreased sales even though the product is of high quality. Callaway needs to strengthen the relationship with the retailers by making sure they know the product and feel the same way about the product that Callaway does. Callaway needs to address the issue of neglect by the company of the retailers; this is one of their SWOT analysis weaknesses. Using the SWOT analysis tool and information obtained from Pearson Custom Business Resources text book, Callaway's threats include Taylor Made Golf and Ping Golf. Both companies saw an opportunity to create a better playing experience as did Callaway and entered the market with their premier products, reducing Callaway's market share. Callaway has always concerned itself with creating a bigger better product to appeal to consumers. Sometimes even before they know it, these areas of strength are responsible for Callaway success. They have continually redesigned and produced new products. As CGC grew, so did its product line. This perceived opportunity lead to the production of more clubs, for different uses for different users and expand into other countries.
Currently their product market expansion has mainly consisted of developing new products for existing consumers. In order to increase Callaway's market penetration, they need to strategically sell more current clubs to the standing market. Using what line of clubs they already have and simplifying the choice options for the average golfer is an option. Callaway considers the average golfer one who plays 10 rounds minimum per year. The Pearson Custom Business Resource textbook states some consumers are confused by all the options available.
Because CGC has moved away from the customer aspect their customers base has slowly changed from True friends to Butterflies on the loyalty/profitability matrix. Originally Callaway brought a superior line of products to the market untouched by the competition. Now golfers could enjoy the sport by hitting the ball with higher precision than before. CGC obviously knew what they had to do, keep creating the want for the need to enjoy the game. By doing this they created a loyal following of true friends who were highly profitable to the company. As their success grew, Callaway seemed to have lost sight of what got them where they are. Instead of keeping the focus on their target market, they spent more time and money into development. This in turn lost the loyalty of the true friends, turning them into butterflies, a golfer who will come and go when the price is right, but still is profitable to the company when they choose CGC.
Metal woods, irons and putter categories covered Callaway's six...