New SmartBall Technology

Table of Content

? Mission Statement and Reputation4-5? Policies and Procedures5? Opportunities in the Environment8? Physical Environment12? Science and Technology13? Social and Cultural13We here at Titleist are trying to produce the most advanced tools for the game of golf. That is why we are working on the SmartBall. The SmartBall is going to bring dramatic changes to the world of golf for the hacker to the scratch golfer. We know how frustrating it is to lose that brand new golf ball on the first drive of the day in the high rough. Therefore, we are trying to make the game more enjoyable and less frustrating for all golfers. The SmartBall is a tracking device that will allow the golfer to find their ball anywhere on the golf course. A small electronic microchip is installed in each of our golf balls. This microchip will send a pulse to the tracking device on your golf bag to tell you which way you should walk in order to find your ball. This tracking device functions like a compass. The device will have an arrow pointing in the direction of the ball. As you get closer to the ball, the red light on the tracking device will blink faster and faster as you approach it. There will also be many other features to this tracking device. It will also tell you how far you hit the ball and your average distances for each club you hit. This is a very important feature because many golfers do not know what club they should use from different distances. In this paper we will try to find out if this is the right time to market our product. We will examine the marketing environment. This includes the internal, operating and macro environments. We will also examine our target market selection. This includes the segmentation variables and the market research of our target market. Our research was to find what group of golfers would be willing to buy or use our product. This research was done through a survey of peers. We wanted to find how much money golfers spend and whether they would be interested in buying our product. Also, secondary research was done to find out how much Americans spend on golf annually and the status of the golf industry. With this research, we hope to find out if this is the right time to market our product.The Internal Environment is composed of the mission statement, history, culture, policies and procedures, reputation, and the financial status of the company that is being studied. We will capture all of these components in the following section.

It all began about 90 years ago when four men from Acushnet, Massachusetts started a business that deresinated rubber. This was sold to companies who made finished products form the rubber. Within 20 years, the company started making its own custom products. Phil Young founded the golf ball division in 1932. In 1976, American Brands bought the Acushnet Company. American Brands follows a philosophy of promoting prestigious brand leaders, usually #1 or #2 in their markets. In 1985 Acushnet bought FootJoy, Inc. and then in 1990 it was combined with the Titleist Golf Division to form Titleist and FootJoy Worldwide, a single division of the Acushnet Company.

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Titleist’s philosophy is to “provide the serious golfer with a golf ball that was quality superior and performance superior to all other balls available at that time”(2). They felt that if their golf balls lived up to the expectations of the best players, then they would soon be delivering the same quality golf balls to all golfers. Their commitment to quality has been their key to success. For the last 50 years, companies have been using Titleist as the standard of measure when they manufacture their own golf balls. “It has long been acknowledged in the golf industry that the best players use the best products. The logic follows that a golfer who wants to emulate the skill level of the best players will choose the very same equipment the best players are using. We have always maintained the belief that by meeting the performance expectations of golf’s pyramid of influence (those key players to whom other golfers are most likely to look for leadership and advice) we will meet the performance expectations of all golfers. The Titleist golf ball has been the #1 ball on the U.S. PGA Tour for over fifty years. The Titleist golf ball is also #1 on the European PGA Tour, the Senior PGA Tour, Nike Tour and the LPGA Tour, with serious golfers at major amateur events, with NCAA college players and with competitive junior golfers”(2).

The reason for the commitment to quality is found in a story. The founder or the Golf Division, Phil Young, missed a putt due to a faulty ball (the core was off-center). Therefore, he decided to make his own golf ball so it would never be the cause of a missed putt again. The company worked with MIT for three years to make the 1st high quality ball worthy of the Titleist name. Each process involved in the manufacturing was fine-tuned and perfected to assure the highest quality. Over the years, Titleist has put a lot of time, money, and commitment into research ; development for their golf balls. The commitment shown to their customers and products has been the backbone of their success. The company has consistently come up with dimple patterns and thread compositions to improve aerodynamics and velocity. They acquire new companies all the time to help expand into golf clubs, golf carts, golf apparel, and other accessories. “Quality, consistency, and performance are inherent in the Titleist name”(2).

Everyone contributes to the development process from research to operations to management. They each want their product to fulfill the golfer’s needs. The company’s employees have one goal, and that is to satisfy the serious golfer’s needs. Besides that, they would also like to give that little bit extra to give their product the advantage over competition. It is a “total team effort.” Titleist understands that in order to continue to be the market leader they must remain responsive to their golfer’s needs. Their knowledge of the market combined with their resources help produce high performance products. The team leaders listen to golfers and tour professionals. Using the responses and input provided, the products are then introduced to these golfers and professionals. Management interacts with every single department, from research and design, right up to sales and distribution. The purpose of this is to make sure the market needs are met. The packaging is even important because Titleist wants their products to be perceived as high quality. To ensure that the needs of customers are met, they use tests performed right at the company, focus groups, and interviews to make sure they are going in the right direction. Titleist wants to continue to provide golf equipment worldwide and to continue to be the leading manufacturer of golf equipment throughout the world. They realize they must continue to provide high performance, quality products in order to do this. The plan is to continue to build on the precedence and tradition already set by the select few who have led Titleist to where it is today. They want to keep satisfying golfers’ needs for a long time to come. They refuse to produce products that don’t meet the high quality standards that the company is known for today. Titleist understands that golfers are their most important resource, therefore their opinions are highly respected at the company. The success that golf has been experiencing will need our dedicated employees to flourish in the future. It is the tradition of our people passing down their knowledge to the next generation that will propel the company into the forthcoming millennium. Titleist would like to always remain “Golf’s Symbol of Excellence”(2).

The operating environment at Titleist includes the stakeholders or anyone with interest in the company. These are the people that make the company successful and the companies that compete for the top of the market. Customers, suppliers, and any other stakeholder can help Titleist succeed or can cause a decrease in sales. Companies such as Spalding and Bridgestone, other worldwide companies, give Titleist competition in the global golf ball market. These companies offer similar product lines and marketing strategies but are lower in quality. Quality is where Titleist excels and gains a competitive edge over other golf ball manufacturers. Technology has become a large part of society and almost controls our everyday lives. Because of the increase of technology in society, computers and technology have expanded into sports. The game of golf uses a lot of technology in research and development of products like golf balls and clubs, but the game itself has been slow to accept the use of technology in the actual playing of golf. Because of this, Titleist has many opportunities to expand their market share and broaden their product line. Our product will give Titleist another edge over the competition in the golf ball market.

The game of golf is bigger now than it has ever been. Since 1986 the number of golfers has increased 33 percent (see Fig. 1 on pg. 7). There are about 26.4 million golfers in the United States that are 12 years or older. Today’s typical golfer is male, 39 years old, has a household income of $65,775 and plays 20 rounds per year (5).

When the popularity of golf increases, the revenue also increases. Golfers spend $15 billion annually on equipment, related merchandise and playing fees. This is a 92% increase from 1986 (see Fig. 2 below). The avid golfers (play 25 rounds or more per year) make up only 24 percent of the adult golfer population, yet they account for 61 percent of the total spending on golf(5). This statistic shows us that our target market should be the avid golfer who is willing to spend the extra money.

The increase in popularity of the game of golf has given Titleist the opportunity to expand their product line with the aid of technology. Customers are a key part of a company’s success. They want the product where they need it. Titleist’s new technology added products would have the place utility that customers want. The new product will be offered at the golf courses or clubhouses. The golf industry is a competitive industry. When it comes to golf balls, Titleist is in a league of its own. All the major golf ball competitors are global companies or have offices worldwide. However, only four companies control the majority of the golf ball use on professional tours. They are Titleist, Bridgestone, Spalding, and Maxfli.

The golf balls that professional golfers use on tour can be good indicators of what balls are good and which are not. Of the professional players worldwide, 65 % of the players use Titleist. Of the 201 professional tours worldwide so far this year, 73% of them have been won using a Titleist golf ball (see Fig. 3 below and 4 on pg. 10). The next closest competitor is Bridgestone with 11% usage and 11% wins (3). So, although Titleist has competition, they are by far the best golf ball manufacturers in the world.

In order to expand their market with technology added products, Titleist will need to collaborate with a trusted supplier who can help them develop a successful product. This will help Titleist enhance their flexibility, especially globally. Working with a name like IBM or Sony will help to market the product. This marketing strategy is highly dependent on the collaboration. Without a supplier like Sony, the product would never be successful.

Before the product is introduced into the market it is important to analyze the macro environment. The macro environment includes the physical environment, the sociocultural forces, demographic factors, economic factors, scientific and technical knowledge, and political and legal factors.

In the golf industry, the physical environment is involved in our customers’ ability to use the product. For example, up in the northern regions of the United States the golf season is shortened because of winter. The golf season lasts about seven to eight months compared to most southern regions where you can golf all year round. Another physical issue is rain. It can help and also hinder the game of golf. The rain helps keep the courses in beautiful shape, but it also leads to less golf on those days. The last issue for the physical environment is the amount of daylight. In the summer months the days are longer which means more golf, but in the winter months, the days are shorter meaning less golf.

Our demographics are related to the weather. The golf season lasts longer in the southern regions of the United States. This allows for more golf to be played in these areas. There is an abundance of golf courses in this southern region, like the Myrtle Beach area in South Carolina. There are close to a hundred courses in its surrounding area, compared to about thirty or forty golf courses in the Erie area. In the winter, people from the northern regions will travel to one of these southern regions to play golf. It is important to know where the majority golfers live and how old they are before marketing our new Smartball. Some other important factors to consider are the education level, occupation, and gender of our customers.

Technology is always changing and people are always doing studies to improve the game of golf. To keep the customers we have and to develop new ones, we need to always keep pace with new and improved ways to make our product keep up with technology. SmartBall helps the average player keep track of his golf balls, and that is an essential element to the hackers’ golf game.

Golf is a sport, usually one without great intensity or need for excellence in physical condition. Therefore golfing is popular sport with both, young and the old. It is also a good leisure activity. Due to televised golf tournaments like The Ryder Cup and popular young players like Tiger Woods, golf is receiving publicity, therefore is sparking interest in people.

With the economy always changing, we have to worry about the SmartBall being a luxury product. People tend to not buy products like ours if there is a recession going on. But when the economy is booming and inflation is rising we should expect a surge of consumers buying our product.

The golf ball market can be considered as purer competition because there are many producers of golf balls and many buyers. With the introduction of the smart ball we will have a monopoly on this technologically advanced golf ball. This monopoly can be short term or long term depending on how quickly our competition develops a similar golf ball. The best time to introduce product like this is during the prosperity part of business cycle, because it is a time when people have the money and are willing to spend the money on the product that will enhance the quality of their golf game. For example they would not have to waste time looking for their golf balls or be forced into investing money in additional golf balls because they lost them.

This has been invented partly due to technology. Through the Internet, which is a recent technological advancement, we will be able to easily market the SmartBall to the world. The golf market will only be responsive to Titleist’s new product development if it is the right time to market the product. Through our research of the golf market we know that the best time to develop and market our product is now. Winter is soon coming up and families will be taking vacations down south. This will give us an opportunity to sell our product or let people try it out. If they like it or respond well to it maybe they will buy it, especially because Christmas is coming up. Golf is one of the largest leisure sports across the globe. And it is only getting bigger because it is the fastest growing. In the 1950’s the number of golfers was 3.5 million and has grown to 26.4 million in 1998.Because Titleist is in a league of its own, there is virtually no competition. Titleist will be the only successful manufacturer of this product. The competition will take a while to catch up to us in the market. The economy is in the best shape that it has ever been. Golfers and Non-golfers spend $16.3 billion annually in the U.S. alone. Customers who golf obviously have a little extra money that they can spend on accessories. Computers and Technology have taken over society. Customers are always interested in what a new gadget or product can do, and how they can make life easier. Customers have relied on technology and will continue to do so. Titleist believes that customers will enjoy their product and will make it a part of their recreational game of golf. Also, technology is at the state where the smaller the computer the easier and better. Our hand held device will make it easy for the customer to use our technology.

For segmentation variables, refer to Appendix A (4).

Table of Contents? Mission Statement and Reputation4-5? Policies and Procedures5? Opportunities in the Environment8? Physical Environment12? Science and Technology13? Social and Cultural13We here at Titleist are trying to produce the most advanced tools for the game of golf. That is why we are working on the SmartBall. The SmartBall is going to bring dramatic changes to the world of golf for the hacker to the scratch golfer. We know how frustrating it is to lose that brand new golf ball on the first drive of the day in the high rough. Therefore, we are trying to make the game more enjoyable and less frustrating for all golfers. The SmartBall is a tracking device that will allow the golfer to find their ball anywhere on the golf course. A small electronic microchip is installed in each of our golf balls. This microchip will send a pulse to the tracking device on your golf bag to tell you which way you should walk in order to find your ball. This tracking device functions like a compass. The device will have an arrow pointing in the direction of the ball. As you get closer to the ball, the red light on the tracking device will blink faster and faster as you approach it. There will also be many other features to this tracking device. It will also tell you how far you hit the ball and your average distances for each club you hit. This is a very important feature because many golfers do not know what club they should use from different distances. In this paper we will try to find out if this is the right time to market our product. We will examine the marketing environment. This includes the internal, operating and macro environments. We will also examine our target market selection. This includes the segmentation variables and the market research of our target market. Our research was to find what group of golfers would be willing to buy or use our product. This research was done through a survey of peers. We wanted to find how much money golfers spend and whether they would be interested in buying our product. Also, secondary research was done to find out how much Americans spend on golf annually and the status of the golf industry. With this research, we hope to find out if this is the right time to market our product.The Internal Environment is composed of the mission statement, history, culture, policies and procedures, reputation, and the financial status of the company that is being studied. We will capture all of these components in the following section.

It all began about 90 years ago when four men from Acushnet, Massachusetts started a business that deresinated rubber. This was sold to companies who made finished products form the rubber. Within 20 years, the company started making its own custom products. Phil Young founded the golf ball division in 1932. In 1976, American Brands bought the Acushnet Company. American Brands follows a philosophy of promoting prestigious brand leaders, usually #1 or #2 in their markets. In 1985 Acushnet bought FootJoy, Inc. and then in 1990 it was combined with the Titleist Golf Division to form Titleist and FootJoy Worldwide, a single division of the Acushnet Company.

Titleist’s philosophy is to “provide the serious golfer with a golf ball that was quality superior and performance superior to all other balls available at that time”(2). They felt that if their golf balls lived up to the expectations of the best players, then they would soon be delivering the same quality golf balls to all golfers. Their commitment to quality has been their key to success. For the last 50 years, companies have been using Titleist as the standard of measure when they manufacture their own golf balls. “It has long been acknowledged in the golf industry that the best players use the best products. The logic follows that a golfer who wants to emulate the skill level of the best players will choose the very same equipment the best players are using. We have always maintained the belief that by meeting the performance expectations of golf’s pyramid of influence (those key players to whom other golfers are most likely to look for leadership and advice) we will meet the performance expectations of all golfers. The Titleist golf ball has been the #1 ball on the U.S. PGA Tour for over fifty years. The Titleist golf ball is also #1 on the European PGA Tour, the Senior PGA Tour, Nike Tour and the LPGA Tour, with serious golfers at major amateur events, with NCAA college players and with competitive junior golfers”(2).

The reason for the commitment to quality is found in a story. The founder or the Golf Division, Phil Young, missed a putt due to a faulty ball (the core was off-center). Therefore, he decided to make his own golf ball so it would never be the cause of a missed putt again. The company worked with MIT for three years to make the 1st high quality ball worthy of the Titleist name. Each process involved in the manufacturing was fine-tuned and perfected to assure the highest quality. Over the years, Titleist has put a lot of time, money, and commitment into research & development for their golf balls. The commitment shown to their customers and products has been the backbone of their success. The company has consistently come up with dimple patterns and thread compositions to improve aerodynamics and velocity. They acquire new companies all the time to help expand into golf clubs, golf carts, golf apparel, and other accessories. “Quality, consistency, and performance are inherent in the Titleist name”(2).

Everyone contributes to the development process from research to operations to management. They each want their product to fulfill the golfer’s needs. The company’s employees have one goal, and that is to satisfy the serious golfer’s needs. Besides that, they would also like to give that little bit extra to give their product the advantage over competition. It is a “total team effort.” Titleist understands that in order to continue to be the market leader they must remain responsive to their golfer’s needs. Their knowledge of the market combined with their resources help produce high performance products. The team leaders listen to golfers and tour professionals. Using the responses and input provided, the products are then introduced to these golfers and professionals. Management interacts with every single department, from research and design, right up to sales and distribution. The purpose of this is to make sure the market needs are met. The packaging is even important because Titleist wants their products to be perceived as high quality. To ensure that the needs of customers are met, they use tests performed right at the company, focus groups, and interviews to make sure they are going in the right direction. Titleist wants to continue to provide golf equipment worldwide and to continue to be the leading manufacturer of golf equipment throughout the world. They realize they must continue to provide high performance, quality products in order to do this. The plan is to continue to build on the precedence and tradition already set by the select few who have led Titleist to where it is today. They want to keep satisfying golfers’ needs for a long time to come. They refuse to produce products that don’t meet the high quality standards that the company is known for today. Titleist understands that golfers are their most important resource, therefore their opinions are highly respected at the company. The success that golf has been experiencing will need our dedicated employees to flourish in the future. It is the tradition of our people passing down their knowledge to the next generation that will propel the company into the forthcoming millennium. Titleist would like to always remain “Golf’s Symbol of Excellence”(2).

The operating environment at Titleist includes the stakeholders or anyone with interest in the company. These are the people that make the company successful and the companies that compete for the top of the market. Customers, suppliers, and any other stakeholder can help Titleist succeed or can cause a decrease in sales. Companies such as Spalding and Bridgestone, other worldwide companies, give Titleist competition in the global golf ball market. These companies offer similar product lines and marketing strategies but are lower in quality. Quality is where Titleist excels and gains a competitive edge over other golf ball manufacturers. Technology has become a large part of society and almost controls our everyday lives. Because of the increase of technology in society, computers and technology have expanded into sports. The game of golf uses a lot of technology in research and development of products like golf balls and clubs, but the game itself has been slow to accept the use of technology in the actual playing of golf. Because of this, Titleist has many opportunities to expand their market share and broaden their product line. Our product will give Titleist another edge over the competition in the golf ball market.

The game of golf is bigger now than it has ever been. Since 1986 the number of golfers has increased 33 percent (see Fig. 1 on pg. 7). There are about 26.4 million golfers in the United States that are 12 years or older. Today’s typical golfer is male, 39 years old, has a household income of $65,775 and plays 20 rounds per year (5).

When the popularity of golf increases, the revenue also increases. Golfers spend $15 billion annually on equipment, related merchandise and playing fees. This is a 92% increase from 1986 (see Fig. 2 below). The avid golfers (play 25 rounds or more per year) make up only 24 percent of the adult golfer population, yet they account for 61 percent of the total spending on golf(5). This statistic shows us that our target market should be the avid golfer who is willing to spend the extra money.

The increase in popularity of the game of golf has given Titleist the opportunity to expand their product line with the aid of technology. Customers are a key part of a company’s success. They want the product where they need it. Titleist’s new technology added products would have the place utility that customers want. The new product will be offered at the golf courses or clubhouses. The golf industry is a competitive industry. When it comes to golf balls, Titleist is in a league of its own. All the major golf ball competitors are global companies or have offices worldwide. However, only four companies control the majority of the golf ball use on professional tours. They are Titleist, Bridgestone, Spalding, and Maxfli.

The golf balls that professional golfers use on tour can be good indicators of what balls are good and which are not. Of the professional players worldwide, 65 % of the players use Titleist. Of the 201 professional tours worldwide so far this year, 73% of them have been won using a Titleist golf ball (see Fig. 3 below and 4 on pg. 10). The next closest competitor is Bridgestone with 11% usage and 11% wins (3). So, although Titleist has competition, they are by far the best golf ball manufacturers in the world.

In order to expand their market with technology added products, Titleist will need to collaborate with a trusted supplier who can help them develop a successful product. This will help Titleist enhance their flexibility, especially globally. Working with a name like IBM or Sony will help to market the product. This marketing strategy is highly dependent on the collaboration. Without a supplier like Sony, the product would never be successful.

Before the product is introduced into the market it is important to analyze the macro environment. The macro environment includes the physical environment, the sociocultural forces, demographic factors, economic factors, scientific and technical knowledge, and political and legal factors.

In the golf industry, the physical environment is involved in our customers’ ability to use the product. For example, up in the northern regions of the United States the golf season is shortened because of winter. The golf season lasts about seven to eight months compared to most southern regions where you can golf all year round. Another physical issue is rain. It can help and also hinder the game of golf. The rain helps keep the courses in beautiful shape, but it also leads to less golf on those days. The last issue for the physical environment is the amount of daylight. In the summer months the days are longer which means more golf, but in the winter months, the days are shorter meaning less golf.

Our demographics are related to the weather. The golf season lasts longer in the southern regions of the United States. This allows for more golf to be played in these areas. There is an abundance of golf courses in this southern region, like the Myrtle Beach area in South Carolina. There are close to a hundred courses in its surrounding area, compared to about thirty or forty golf courses in the Erie area. In the winter, people from the northern regions will travel to one of these southern regions to play golf. It is important to know where the majority golfers live and how old they are before marketing our new Smartball. Some other important factors to consider are the education level, occupation, and gender of our customers.

Technology is always changing and people are always doing studies to improve the game of golf. To keep the customers we have and to develop new ones, we need to always keep pace with new and improved ways to make our product keep up with technology. SmartBall helps the average player keep track of his golf balls, and that is an essential element to the hackers’ golf game.

Golf is a sport, usually one without great intensity or need for excellence in physical condition. Therefore golfing is popular sport with both, young and the old. It is also a good leisure activity. Due to televised golf tournaments like The Ryder Cup and popular young players like Tiger Woods, golf is receiving publicity, therefore is sparking interest in people.

With the economy always changing, we have to worry about the SmartBall being a luxury product. People tend to not buy products like ours if there is a recession going on. But when the economy is booming and inflation is rising we should expect a surge of consumers buying our product.

The golf ball market can be considered as purer competition because there are many producers of golf balls and many buyers. With the introduction of the smart ball we will have a monopoly on this technologically advanced golf ball. This monopoly can be short term or long term depending on how quickly our competition develops a similar golf ball. The best time to introduce product like this is during the prosperity part of business cycle, because it is a time when people have the money and are willing to spend the money on the product that will enhance the quality of their golf game. For example they would not have to waste time looking for their golf balls or be forced into investing money in additional golf balls because they lost them.

This has been invented partly due to technology. Through the Internet, which is a recent technological advancement, we will be able to easily market the SmartBall to the world. The golf market will only be responsive to Titleist’s new product development if it is the right time to market the product. Through our research of the golf market we know that the best time to develop and market our product is now. Winter is soon coming up and families will be taking vacations down south. This will give us an opportunity to sell our product or let people try it out. If they like it or respond well to it maybe they will buy it, especially because Christmas is coming up. Golf is one of the largest leisure sports across the globe. And it is only getting bigger because it is the fastest growing. In the 1950’s the number of golfers was 3.5 million and has grown to 26.4 million in 1998.Because Titleist is in a league of its own, there is virtually no competition. Titleist will be the only successful manufacturer of this product. The competition will take a while to catch up to us in the market. The economy is in the best shape that it has ever been. Golfers and Non-golfers spend $16.3 billion annually in the U.S. alone. Customers who golf obviously have a little extra money that they can spend on accessories. Computers and Technology have taken over society. Customers are always interested in what a new gadget or product can do, and how they can make life easier. Customers have relied on technology and will continue to do so. Titleist believes that customers will enjoy their product and will make it a part of their recreational game of golf. Also, technology is at the state where the smaller the computer the easier and better. Our hand held device will make it easy for the customer to use our technology.

For segmentation variables, refer to Appendix A (4).

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