Callaway Golf Case Study

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Callaway Golf Company
LaToya Owens, Chris McMullin, Robb Spears and Crystal Shumpert
Indiana Wesleyan University

Key Success Factors Callaway Golf Company’s (CGC) had seven key success factors to include: the founder’s vision; product design; pricing; product development; sales; marketing and the media. The founder, Ely Callaway’s vision is: “If we make a truly more satisfying product for the average golfer, not the professionals, and make it pleasingly different form the competition, the company would be successful.” However, this vision is change from other company’s visions; the difference being that the price is not mention. Product design: CGC introduced three new designs in golf clubs in 1988, the first, short, straight, hollow, hosel (S2H2). This club distributed the weight of the hosel, nearly eliminating it to free up precious weight to be used elsewhere in the club, and push the shaft straight through the club head. In 1991, Big Bertha, named after a World War I canon, is an oversized metal wood that provided a larger “sweet spot”, which provided better accuracy for the average golfer. It was one year after Big Bertha was sold before competitors had an oversized metal wood. By 1995, Titanium was the company’s third primary technological breakthrough. Because the total weight of the clubhead is fixed, titanium aided in moving the material away for the clubhead center. Pricing: CGC introduced the Big Bertha in 1991 for $400. “Which was probably twice as much as anybody had ever paid for a driver” the company knew that it had a great product and that it would bring internal benefits to the golfer, and it sold very well. Calloway Golf pricing strategy infrequently adjusted their price. The price was “typically maintained over the life cycle of the product,” the product was only reduced after the end of the life cycle of the product, which was typically two or three years (seasons). CGC pricing could be considered

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