Callaway Golf Wants to Give You $100

Callaway Golf Wants to Give You $100

Post image for Callaway Golf Wants to Give You $100

#PowerToThePlayer

Written By: Tony Covey

The current product life cycle formula in golf is evolving. In its simplest form, the new model is starting to look something like this: Lots of new drivers + Lots of price drops = Lots of not so happy golf consumers and less loyal fans.  Feedback of late has been honest & harsh.  The truth…remember…can hurt.

MyGolfSpy is a place where all golfers can come to give and honest opinion and have their voice heard.  We call it #PowerToThePlayer.  We’re here for one reason:  To Empower You The Consumer.  And we feel the recent announcement by Callaway is in a direct response to that honest & harsh feedback you gave the Callaway brand.

Buying Your Loyalty Program

While you were trying to sneak out of work early on Wednesday, Callaway Golf quietly (by Callaway standards anyway) announced one of the more compelling consumer loyalty initiatives in recent memory. Actually, it’s probably inaccurate to use the phrase one of the. From my viewpoint, Callaway (for now anyway) is the only company taking any sort of measures at all suggestive of the fact that loyalty not only matters, but that it’s a two-way street.

The headline probably casts a wider net than it should. Callaway is only doing right by you if you’re one of the guys who bought a Big Bertha or Big Bertha Alpha before the 815 series launched, but that’s reasonable. Like I just said…two-way street. If you haven’t been loyal to Callaway (you didn’t buy a Big Bertha Driver), there’s no practical reason for the company to hand you $100.

Here’s the specifics of what Callaway is offering.

Bummed because you bought a Big Bertha or Big Bertha Alpha driver earlier this year and then thought, “Wow, I really want one of those new ones?” We’ve got your back.

With the Big Bertha Loyalty Bonus, just trade in your driver and we’ll give you an additional $100 bonus (on top of the trade in value) toward the purchase of a V Series, Alpha 815 or 815 Double Black Diamond. It’s as simple as that.

So enjoy your long weekend, eat lots of turkey and head to your nearest participating retailer before this offer runs out.

We’ve made noise (and plenty of it) about how rapid discounting and rapid releasing often leaves a rotten-cranberry-bitter taste in the mouth of the guy who spends $500 on a driver only to see it discounted shortly after the snow melts, or replaced entirely before the season is over.

For your part, many of you have vented your own frustrations at having your brand new equipment obsoleted before you’re idiot cousin can borrow it (and subsequently return it with a skymark). This new offer leads us to believe that Callaway might actually be listening.

As you may recall from our Big Bertha 815 Alpha Launch Article, one of the many questions that Callaway chose not to answer was this:

Even if you’re able to manage inventory, maintain pricing, etc., have you given any consideration to the reality that people just want new gear (the latest and greatest), and when they can’t always have it (because none of this is cheap), irrational or not, it just kind of pisses them off, and they blame the manufacturer?

I suppose this is your answer, and quite frankly, I think it’s a pretty damn good one.

Golf clap for Callaway.

Loyalty really is a two-way street, and with a recent history of rapid discounts and the most accelerated release cycles we’ve ever seen, golf companies haven’t been particularly loyal to the consumer. Kudos to Callaway for stepping up and offering something for the guy who bought the previous generation product.

My translation of the Callaway message is this:

“We appreciate that you’ve chosen to play our products.. We hope you’ll to continue to play our products, and so here’s a little something to help make that possible.”

There are unfortunate market realities that are beyond Callaway’s control. Certainly rapid release cycles contribute, but it’s not completely on Callaway that the trade in value for Big Bertha and Big Bertha Alpha drivers are $71.41 and $82.27 respectively. It’s the kind of garbage number that repeatedly drives the consumer to eBay. The PGA (de)Value Guide is just one more example of futility from an industry that seems to enjoy shooting at its own feet.

What Callaway is effectively doing is fixing the Value Guide’s problem. Good on Callaway.

An extra $100 for your less than 1 year old driver isn’t the perfect offer, but it’s as good or better than you’ll do on eBay, and that makes it by far the best offer on the table right now.

The Devil is In the Details

As much as I’m a fan of what Callaway is offering (and I am), there are some pertinent details you should be aware of.

Among the things not specifically mentioned above is that Callaway’s offer ends 12/31/14. Frankly, I think it should run longer…perhaps for the entire lifespan of the 815 series.

Now is the time when I should make a joke about Callaway’s recent track record suggesting that the end of December probably covers the full lifespan of the 815 series anyway, but even if Callaway has so far chosen not to go on record with it, I believe the release schedule is where Callaway wants it to be. Moving forward, it should be 1 full year between releases…and if it’s not, it can always do more of this.

What this gives you is the opportunity for a very Bertha Christmas for yourself. That’s good.

What’s not so good is that to take advantage (and claim your $100 bucks) Callaway has stipulated that you must deprive yourself of the opportunity to even try competing products from TaylorMade, Nike, and Cobra. Let me spell it out for you. Callaway’s Bertha Trade-Up offer expires before R15, Vapor, and FLY-Z hit store shelves. That is unquestionably a solid business move, even if it gives off a touch of the jealous boyfriend vibe.

Like I said, it’s an imperfect offer, but if you’re already solidly a Callaway guy, it’s still the best offer on the table right now.

The Uncomfortable Reality Check

You’re not going to find anyone from big golf company to go on the record with:

“Golf in the USA is in decline, and restoration is not in its immediate future.”

Behind closed doors, however; most everyone in the industry understands that for all the Hacking and Growing stuff, much of what’s at the heart of golf’s decline extends beyond the industry’s reach. The golf industry can’t fix golf.

Acceptance of that reality drives another; Consumer loyalty is more important than ever. You don’t simply want the loyal consumer, you absolutely need him. Callaway appears to be the first in golf’s filthy fan era to accept that a few hardcore guys (the guys who can’t type 140 characters without including #TEAMCALLAWAY) aren’t enough to seriously move the needle. You need a following that’s both loyal and large.

While there will always be a few fans o’ the brand who’ll buy without giving it much of a thought…the rest of us need to be incentivized. Callaway apparently gets that. I believe its offer is a sign of things to come from inside golf industry. Trade-in/Trade-up programs will almost certainly replace the slash and burn model of recent years.

Discounts will still be had, but the best deals will be reserved, as they should be, for the consumer who is loyal to a given brand.

 

Golf Forum – Golf Blog (MyGolfSpy.com)

Callaway Wants to Give You $16,253

Callaway Wants to Give You $16,253

Post image for Callaway Wants to Give You $16,253

Written By: Tony Covey

In case you missed it, yesterday Callaway announced what they’re calling THE  BIG BIG BERTHA PAYDAY contest. The bold caps were their idea. It’s so huge that you can’t simply talk about it, it needs to be screamed:

THE BIG BIG BERTHA PAYDAY!

I’ll be honest, I’m less on-board with Callaway’s version of the equipment hype machine than others in my particular sphere of the media, and as a general rule I don’t believe that big OEM contests warrant 10% of the hype that the golf companies try and throw behind them, but in this particular case, I’m riding the fence…actually, I think I just crossed it.

Somebody could win 1.5 Million (that’s probably what we should have used the giant screaming font on). And yes…I know that I used a much smaller number in the headline, but I’ve got a rep (for being sometimes humorous, often cynical, and occasionally a total douchebag) that I need to live up to, so I led with the lowball number.

Shame on me.

Here’s how this thing works:

:: Demo a Big Bertha Driver at participating retailer (or don’t, more on that in a bit).

:: Go to the Sweepstakes Website, type in your code, your participating retailer, and some personal info…

and #BOOM you’re entered to win Phil Mickelson’s US Open Paycheck.

Not his actual paycheck. It looks like you get one of those giant checks from Callaway. The important thing is that the numbers are the same.

In case I haven’t been clear with this (and I admit, I probably haven’t), for one “Callaway Fan” the company will match Phil’s US Open Paycheck. You win what Phil wins.

A 2nd place winner receives a Phil Mickelson autographed Callaway Driver. According to the rules, it’s a non-specific driver of Callaway’s choosing, so let’s hope for the runner-up’s sake they don’t have any leftover Diablos they need to unload.

For those who already have demoed a Big Bertha and don’t care to do it again, or for those who don’t give a damn and just want a shot at a buttload of money, Callaway has provided a workaround:

To participate in the Sweepstakes without visiting a participating retail location and demoing The New Callaway Big Bertha Driver: During the Sweepstakes Period, visit www.bigberthapayday.com (“Website”), provide the Entry Information requested and enter the Code BIGBERTHA2014. For the name of participating retailer location you visited select “Other” from the pull-down menu and click “Submit” to receive one (1) entry into the Sweepstakes (“Alternate Entry”).

phil-win

But What If Phil Misses the Cut?

Given how Phil has played recently, there’s a chance that the Second Place prize could be worth more than the Grand/First Prize. Callaway has accounted for that. In the unfortunate event that Phil does miss the cut  (dude has made 21 of 23 US Open cuts so it probably won’t happen) Callaway will pay out what the last place paid finisher gets, which as it happens is $16,253.

Ta-da…headline.

If you look at the whole of Phil’s body of work over his 21 US Open made cuts, his average finish is 26. If he matches that, the winner is looking at something in the very general ballpark of $75,000.  That’s pretty sweet. Consider Phil’s 10 Top-10s, 8 Top-5s, and 6 runner up finishes, and Callaway’s winner could be in for a huge payday (1.5 Million if Phil wins).

Cynical as I may be, friends, that’s one hell of a golf contest.

No Better Time

For Callaway, the US Open, and by extension, this contest, couldn’t come at a better time. Despite strong Q1 results, reliable sources are telling us that Callaway sales are trending the wrong way right now, and there is some uneasiness within the company. The Apex iron has remained a strong performer, but after a strong initial launch sales of Bertha drivers have leveled a bit, and in some markets big box numbers across the board aren’t what they’d like them to be.

That last bit is almost certainly true for everyone given the long winter, and of course the doom and gloom surrounding the decline of the game in general, rounds, lost, etc. Golf, and by extension golf equipment is a tough business for everyone right now, but Callaway is still trying to claw its way out of the hole it dug for itself over the last decade, and that leaves them more vulnerable than others to further overall declines in the market.

As you may have noticed, TaylorMade has its foot on the accelerator again (the same is usually true of the old lady who drives through the convenience store window, so….). Their free fairway with JetSpeed driver promo carried them until they could queue up the Mini Driver and the rest of the new SLDR S. The SLDR irons, I believe, are going to be a mammoth success, and the likelihood is that all of it will help TaylorMade reclaim market share from Callaway.

612x612-big-bertha-payday-promo

A Tough Spot

All of it puts Callaway in a bit of a tough spot. Sure, they slashed prices (and aggressively so) on X2 Hot, but in general, the best way to fight new product is with new product. It’s a reasonable assumption that Callaway has something it could release tomorrow, but they’re barely 3 months deep with most of their product, and the 6 month old stuff (Apex) is the strength of the lineup right now. Basically, they’re not likely to pull a TaylorMade just yet, which means they had to come up with an outside of the box way to  jump start the buzz engine, and this certainly qualifies.

#BerthaPayday Translates Well

One of the things I’ve questioned about the new Callaway model is how well the online stuff (full-on Twitter assault, Callaway Media productions, etc.) will translate to the offline world. Sure, I get the sphere of influence, word of mouth thing, but I’m not convinced that you can hashtag your way to the top of the golf industry.

The chance to win 1.5 million…that translates. Check out the TV spot.

Dont’ Worry, They’re Covered

One of the things that initial concerned me is the prospect that Callaway might have to payout 1.5 million bucks at a time when nobody in the industry really wants to be giving away 1.5 million bucks. Good news for shareholders, right?

The last thing you’d want is a situation where it’s arguably in Callaway’s best financial interest for Phil to miss the cut (not that it’s the nature of the Callaway guys I know to want for such things anyway). Fortunately there is insurance for exactly this sort of thing.

I was able to confirm that Callaway has purchased insurance against a strong showing by Phil. Basically what that means is that the money is already spent (based on some quick digging, the policy likely cost Callaway something in the low six-figure range), and that Team Callaway and the rest of us can sit back, relax, and hope it goes well for Phil (and the guy whose name gets pulled out of the hat when this is over).

If Phil wins the US Open, it will be huge for Callaway (it would have been huge anyway, but we’re talking bring-back-the-screaming-font huge). You can bet stories will be written about the 1.5 million (I bet a quarter million gets plenty of coverage too) Callaway gave to one of its fans, and the impact will likely trickle through the rest of the golf season. Even if Phil doesn’t get TV time on Sunday, the value of the build up will likely exceed Callaway’s costs, and that alone is a win at a time when nobody in the golf industry is winning much of anything.

For what it’s worth, the last time Callaway ran a promotion tied to Phil Mickelson’s performance in a Major, the dude won The Masters, and Callaway reimbursed fans for 2000 drivers.

Golf Forum – Golf Blog (MyGolfSpy.com)