Altius Golf Case Study Spreadsheet

Case | HBS Case Collection | May 2013

Altius Golf and the Fighter Brand

by Robert J. Dolan and Sunru Yong

Abstract

Altius Golf is the clear leader in the golf ball market despite a long-term decline in the number of golfers and a drop in sales following the financial crisis. The firm has maintained its position by introducing generations of advanced, super-premium golf balls that allow their customers to emulate professional golfers. The company has been losing market share to lower-priced competitors and the CEO wants to introduce a new program called Elevate to foster the next generation of golfers. With Elevate, the firm will introduce a ball that is more forgiving and easier to drive for distance and offer it at a price 40% below the company's flagship brand. Elevate will be available through "off-course" channels such as golf specialty stores and big box retailers instead of "on-course" pro shops where the firm typically sells its products. The board of directors is divided on whether to support the decision. Students must perform a quantitative analysis of the CEO's proposal to understand the potential risks and gains before making a final recommendation.

Keywords: Governing and Advisory Boards; Competitive Advantage; Decision Choices and Conditions; Distribution Channels; Sports; Financial Crisis; Brands and Branding; Segmentation; Sports Industry; Entertainment and Recreation Industry;

Exhibit 1 - U.S. golf equipment and ball sales (retail dollar sales, current) Year % change vs. prior year % change vs. prior year 2007 2,911 552 2008 2,752-5.5% 536-2.9% 2009 2,433-11.6% 495-7.6% 2010 2,384-2.0% 479-3.2% 2011 2,414 1.3% 464-3.1% 2012 2,628 8.9% 483 4.1% Source: Mintel  Year 2007 2,359 552 2,911 2008 2,216 536 2,752 2009 1,938 495 2,433 2010 1,905 479 2,384 2011 1,950 464 2,414 2012 2,145 483 2,628 5962920 1575378 3.785072535 1585882.9787234 5923421.28-10504.9787234042 39498.7200000007 Total equipment, incl  balls (millions, USD) Golf balls (millions, USD) Total equipment,  Excluding balls  (millions, USD) Golf balls (millions, USD) 2007 2008 2009 2010 2011 20120 500 1000 1500 2000 2500 3000 Golf balls (millions, USD) Total equipment, Excluding balls (millions, USD)

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