Recommendation: Golflogix should sell the Distance-only and Complete-System through the golf courses channel and not in retail to golfers. However, Golflogix can reduce their pricing on the Complete-System and generate revenue from an additional stream of subscription from golfers to the Complete-system. This not only generates additional revenue but also increases demand for the system and builds pressure on the golf-courses to provide the infrastructure for it. Analysis:
Market numbers suggest a much larger market of golfers as opposed to that of the golf courses. Units sold to target market differs with the target market in the case of golf courses because 60 units per golf course are sold. However, with various segmentation techniques, it can be concluded that the golfers who would buy the Distance-only or Complete System, would be those who measured their performance by measuring their handicap, thus forming the first target market within the golfers. Discouragingly, this was only 20% of the golfers. Also, the golfer market would further be divided by 4. Since a game usually consists of 4 players, only one of them would need the device, regular players may share the cost. Although the distance-only system is easy to get up and running, when sold directly to the golfers, the golfers would themselves need to outfit their green on the golf course. This would take away from the key value proposition to the golf courses that is ‘pace of play’. Golf courses may need to charge an initial amount to the new customers (golfers) to take into account time spent in setting up the distance-only system. Also with the technical setup requirements of the Complete-System, it would be almost impossible for a golfer to do it himself. Also, with the golf-course channel, it will be easier to lock-in the golfers. The real benefit of the “Complete System” would be realizable to the end-user (golfers) when they see improvements in their game with their regular use of the...
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