Callaway Golf Company

1272 WordsDec 1, 20116 Pages
Callaway Golf Company (CGC) Harvard Business School Case Study Ely Callaway had a vision, “If we make a truly more satisfying product for the average golfer, not the professionals, and make it pleasingly different from the competition, the company would be successful” (Lal & Prescott, 2011, p. 1). Key factors that led to Callaway’s success included his vision, his understanding of consumer behavior, his product variety, and his ability to build a premium brand. Furthermore, the company’s relationship with its retail partners, the company’s new product development, and the company’s marketing strategy were key contributors to Callaway Golf Company’s success between 1988 and 1997. Callaway understood the competitive nature of…show more content…
Annual plan controls helped determine if the new product results were being achieved. Profitability controls determined if the new product was making or losing money. Efficiency controls balanced the spending and marketing expenditures. Strategic controls confirmed whether the company was targeting the best opportunities with the retailers, media, and advertising (Kotler-Keller, 2009, p. 331-333). Richard Helmstetter, vice president and chief of new products, joined Callaway Hickory Stick, Inc. in 1986. He transformed CGC “. . . from a niche producer to an innovation powerhouse. . .” (Lal and Prescott, 2000, p. 2). Helmstetter viewed research and development differently than others in the industry. He challenged the scientists, engineers, and golfers he had hired to answer questions like “Where does backspin come from?” and “Why does a shot on the club toe hook left instead of right?” (p. 2). Helmstetter was correct in believing that by answering these types of questions the company would create better clubs. New product innovations included the development of the S2H2 (short, straight, hollow, hosel) model which redistributed the weight of the hosel. This allowed the weight to be better utilized elsewhere in the club. Following the S2H2 model was the development of the Big Bertha. It was a club with a bigger club head. The larger head allowed for fewer

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