Overview Background/history Issues General environment analysis Industry environment analysis Knowledge/perspectives Recommended actions Summary/conclusion

Calloway Golf Founded in 1982 by Callaway Golf Company Originally Callaway Hickory Stick USA Revolutionized the Industry, “Big Bertha” Odyssey, FrogTrader, Top-Flite More than 110 countries worldwide

Issues Gaining market share in golf clubs and balls when remaining market share is already limited. Lack of customization of product lines on the global stage. How can Calloway achieve and sustain growth in spite of global economic strife?

General Environment Analysis Decreased demand for golf clubs due to global economic recessions Golf is a leisure sport, not a necessity (therefore expendable) Golf is not a growing industry

Industry Environment Analysis *Derived from Porter’s Five forces model

Strengths Callaway Golf Company products are designed and built on an 8 building campus in California, which is also home to the majority of their employees. Advanced technology allowed Callaway to go from a small golf club manufacturer to the largest producer of premium golf clubs and a dominant force in the industry. Callaway designs, manufactures and produces small accessories as well. Value added brand name Adjustability in the employment system

Weaknesses Callaway Golf Company experienced an operating loss 25.6 million in the golf ball business due to product expansion and competitive pricing efforts. No switching cost for customers Operating and sales loses due to counterfeit products being produced in Asia Callaway marketing is limited and focused on promotion through professional players Consumers geared more towards the style and cosmetics more than technology

IFE

Opportunities Penetration of Asian market in anticipation of fast developing economy with rapidly expanding middle class. Increase in the number of golf rounds played in New England state and Mid-Atlantic throughout Europe Utilizing Top Flite to offer a second tier of clubs and accessories Further diversification of product line (watches, tees, cigars) Larger sponsorship in PGA tours

Threats Golf industry declining entirely Massive amounts of imitation and counterfeit products Low margin courses shutting down due to economy Competitors offering more specialized products to consumers Less golf rounds being played in U.S

EFE

Recommended Actions Development of discount product line of golf clubs as brand extension of Calloway (i.e. Golf Pro, powered by Calloway) Wider range of products other than only clubs and balls Customized product lines specific to markets

Questions?