Marketing Strategy
Strategic Overview
Beyond product development, ProGrip creates value primarily through the marketing stage. (Manufacturing and distribution will be outsourced.) Building demand plays a central role to the acceptance of the Impress grip in the marketplace and the success of the company. Retailers and OEMs will not purchase component products without demonstrated demand from the market, and golfers will not be motivated to switch brands unless they are convinced of the benefits of a new product. Therefore, ProGrip will pursue grass roots, traditional, and innovative marketing and sales strategies to aggressively build acceptance of and demand for its premium line of Impress grips. Based on a careful review of other standard and premium grips and of other anti-vibration devices, ProGrip will price its Impress line at a premium. Market data indicate a high willingness to pay a premium for innovative products—particularly for grips, which are relatively low-priced compared to golf clubs and their other components.
Build Regional Demand
ProGrip will concentrate building demand in the top ten states in the country with the most number of golfers age twelve and higher. In descending order, those states are: California, New York, Pennsylvania, Michigan, Illinois, Ohio, Georgia, Florida, Wisconsin, and Minnesota.
The company will then expand its focus to include selected markets within other states and offer the Impress grip nationwide by late 2003. The company will eventually expand sales globally and intends to enter into joint venture agreements with foreign distributors and retailers of golf equipment, starting with Japan and the UK.
Channel Selection (Market/Distribution/Retail)
Half of all golf grip sales are made through the re-grip market—to golfers who put new grips on existing clubs. The other half are sold to OEMs who install the grips as components of new clubs. ProGrip's strategy involves first penetrating the re-grip market and then gradually entering the OEM market. The sequential approach is favored for two reasons. First, the re-grip market offers higher margins. Second, the OEM market is a difficult market for new products to enter. Consumer demand created in the golf equipment components market (i.e., grips, heads, shafts) is what typically drives OEM club manufacturers to eventually offer new product components on their clubs. Additionally, Flynt (a relative newcomer to golf grips) used the sequential strategy to introduce its line of golf grips in 1996 and has since established itself as a reputable brand. Allegra, a major golf OEM, now installs Flynt grips on some of its clubs.
Initial channels include those distributors and retailers who cater to the re-grip market. ProGrip will pursue relations with over 400 retailers and distributors of golf equipment nationwide, concentrating on those doing business in the ten key states that have the most golfers. The intent is to develop strong relationships similar to the one ProGrip currently has and continues to build with Golfworld. Winning the support of retailers' sales forces and teaching pros who influence consumer decisions will be vital, and that support will come through their understanding of the benefits of the Impress grip. To accomplish this, ProGrip will teach distributors and retailers, their sales forces, and teaching pros the benefits of the Impress grip through a training video, product demonstrations, and sales representatives. (The video and product demos will also be used for promotion to consumers.) Finally, ProGrip will keep our retail and distribution partners informed of our marketing campaigns and promotions to ensure they are familiar with the demand levels we generate.
Private Label
ProGrip will explore opportunities to enter into private label agreements with major retailers in the U.S. such as Golfworld and Winners. Golfworld has already expressed interest in such a venture.
Promotion
In the golf equipment industry in general and the re-grip market in particular, it is extremely important to build product demand at a grass roots level in order to gain user acceptance. This is because golfers' purchase decisions are heavily influenced by the advice of friends, pro shop sales agents, and local teaching professionals, as well as through the emulation of golf professionals who succeed while using particular products. To build a "buzz" around the Impress grip, ProGrip has developed and will implement grass roots and viral marketing tactics concentrated in the ten key golf states. Such tactics include traditional approaches like buying print and broadcast ads, publishing articles on the Impress technology in influential journals, developing relations with local pros and teaching them about our product, distributing our training video, direct mailing, conducting product demonstrations at prominent and well-visited driving ranges, golf courses, and country clubs, and finally seeking pro usage on prominent tours. ProGrip will also employ innovative approaches to promote understanding of importance of re-gripping one's clubs and to build customer loyalty to the Impress grip. Two such approaches are "Re-Grip Day" and the "ProGrip Community." After initial market penetration, the company will pursue top-tier pro endorsement, broadcast sponsorship, and additional co-branding opportunities.
Print Promotions
The company will pursue editorial coverage and advertisements in golf and trade publications as well as general consumer magazines and newspapers worldwide. These include Golf Digest, Golf Magazine, Sports Illustrated, the Wall Street Journal, and USA Today. The cost of a full-page advertisement in Golf Digest and Golf Week are $60,000 and $17,500 respectively. Additionally, the company will use other media to convey the benefits of the technology to key industry influencers. For example, Golfworld CEO John Danko offered to publish an article on the Impress technology in Golfworld's Clubcraft magazine, the largest technical journal in the trade with a nationwide subscriber base of 125,000. Readership includes respected and influential equipment specialists and sales representatives.
Broadcast Promotions
The company intends to utilize 30 and 60-second direct television commercials on national stations such as ESPN and the Golf Channel as well as radio advertising, once the brand gains a foothold with core golfers. Advertising will include a series of innovative commercials to run during major golf tournaments and other golf-related programs.
Use of Impress By Professionals
The company will win support from local teaching professionals who are key opinion leaders in their respective golfing communities through leveraging existing relationships between ProGrip and several key industry contacts. ProGrip industry contacts include manufacturers and distributors (e.g., GolfSmith, Golf Authority, and Head), golf courses (Myrtle Beach, Cedar Grove in Atlanta, and the Atlanta Country Club), and acquaintances of PGA members such as Ben Crenshaw and Tom Kite. ProGrip will seek wide-ranging use of the Impress grip from many second-tier pro golfers. The company also considers the Buy.com Tour (formerly the Nike Tour) and the PGA Senior Tour as the two best opportunities for Impress grip trial by top-tier pros. Pro usage of a golf product (second tier and top tier) can spur extremely effective word-of-mouth marketing in the golf equipment industry.
Re-Grip Day
ProGrip will host "Re-Grip Day" at major corporate campuses and office complexes. Golfers will be encouraged to bring in their clubs to have them re-gripped by ProGrip representatives at our portable workshops. A short video loop will provide useful information, and representatives will help golfers select the right grips for their clubs. Golfers can learn how to perform the relatively easy task of re-gripping their own clubs, or they can simply drop off their clubs and return later to pick them up with the new Impress grips installed.
The Progrip Community
Golfers who express interest in or purchase one of the company's products will receive informational newsletters on golf issues related to technology, performance, and health, and they will receive ProGrip promotional offers. This will be part of ProGrip's campaign aimed at building and maintaining a community following. The company has already developed a database of hundreds of potential customers, which continues to grow. The information was collected from market research and includes contact information as well as demographic and behavioral data.
Sponsorship
Sponsorship of selected golf tournaments and the Golf Channel's weekly instructional program, "Living Room Lessons" as well as other golf-related events with wide exposure would serve to build continued brand recognition among the golf community.
Co-Branding Opportunities
ProGrip has already initiated discussions with Walt Disney Corporation for the licensed use of certain of its copyrighted characters on its grips marketed for junior golfers. In addition, the company will seek to license characters from the Cartoon Channel and Nickelodeon, two media brands popular among young people.
Pga Golfer Endorsement
Formal endorsements from top-tier golf professionals are an important strategy for golf products to gain acceptance from amateur golfers, although the expense necessitates demonstrated acceptance on at least a regional level. The company will eventually seek endorsement from a top-25 ranked professional golfer on the PGA Tour to promote its product lines and build brand strength.
Additional Promotional Activities
The company will engage in a variety of additional promotional activities to sell and market its products. Such activities include 1) consumer sweepstakes; 2) promotional giveaways with certain purchases, including items such as instructional videos and audiotapes; and 3) promotional campaigns. Working with Golfworld, the company has already conducted the first such promotion—a drawing for a $100 Golfworld gift certificate for participants of one of our market research surveys.
Pricing
Primary consumer research has shown that golfers will pay a premium for technology-based products that reduce shock and vibration and promise to improve their game. The research specifically indicates that the average Impress grip could be priced attractively at $5.00, comparable to the pricing of other premium grips, which range from (roughly) $4.50-$5.50 per grip.
