Will Online Sales Erode Long Term Demand for Golf Clubs?

In this world of retail where more and more business is done online, and the popular press likes to write off the significance of traditional brick and mortar (even though it represents the vast majority of all sales) I think it’s worth asking the question:

Will increases in Online Golf Club Sales negatively impact macro consumer demand?

Though I don’t like to use personal experience as a guide, I don’t feel I’m alone in saying that I make substantially fewer shopping trips to brick and mortar stores today than even a few years ago.  And I’m not speaking solely about golf retailers, but include general merchandisers as well.

Because I’m not in stores as often, my exposure to the newest products or technologies has lessened significantly.  I don’t see the displays and prices that attempt to entice me to buy.  I don’t have as much first hand interaction with sales associates who espouse the features and benefits of the latest and greatest new products.  I can’t capture the feel or performance characteristics of new materials and designs.  In essence, I have less personal interaction with product.

Also, if I don’t shop and see product for myself at retail, I’m not likely to be aware of changes in new product pricing.  And if it’s a product I only purchase every few years or more, like durable goods, it’s even less likely that I will have knowledge of prices at retail.

What does this all mean to golf clubs?

*Less in person exposure means fewer interactions with product, and potentially less involvement and awareness.

*Lower involvement in a category like golf clubs means fewer reasons to buy.  Golf clubs rarely wear out and must be replaced, rather golfers buy new clubs because they decide they want them, not because there is a need.  Clubs are discretionary durable items, and as such demand for these products must be stimulated by OEM’s and/or retailers, and fewer in person experiences reduces product interest.

*Fewer in person consumer touch points at retail in a category like clubs means the industry must find new ways to reach out and expose their message to the ultimate arbiter of what is hot…the consumer.

*Over the past few years the pricing strategies of some leading golf club brands has evolved and prices have increased significantly.  These higher prices can create “sticker shock” when many golfers finally decide to start looking for new clubs, and cause hesitation to buy.

*Also, because the cadence of club product launches has slowed, there are far fewer second and third generation products in the marketplace, and lower price points no longer provide many alternate products to buy.

*Getting golfers past these pricing obstacles takes time as golfers adjust to the new normal, and likely will only happen when club OEM’s can create compelling product reasons to buy based on true performance/design/technological improvements.

Online vs. Personal Touch Points

Online selling provides the consumer with many benefits, including convenience and in some categories pricing.  However the overwhelming amount of direct to consumer communications in todays world makes it very difficult to crack into the end customer’s psyche and create enthusiasm and demand for durable goods.  The constant assault to the senses of email and social media makes it harder rather than easier to gain personal touch points for manufacturers and retailers.  Brick and mortar will remain viable, though there will likely be fewer stores available, however enhancing the experience of trying clubs will be critical to establishing growth over the long term.

Holiday 2016

Many US retailers are looking toward the 2016 Holiday Season with great anticipation.  General retail sales are expected to grow by 3.5%-4.0%, as the average consumer plans on spending more than they did a year ago, and the 2016 season is blessed with an extra weekend of shopping before Christmas due to Thanksgiving falling early.

While online commerce will continue to grow in importance in golf clubs just as it will in the overall US economy, golf club manufacturers must keep their eye on stimulating more in person consumer touch points to get back into growth mode in total.

 

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