TaylorMade helps customers stay current with the latest in golfing technology

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There are basically four kinds of golf clubs: woods, irons, wedges and putters. Woods have large, bulbous heads and are used to drive the ball long distances. The longest-hitting wood of all — the club generally used for tee shots — is called a driver. Most well-equipped golfers also carry a couple of fairway woods for distance shots along the way.

Irons, which have bladelike metal heads and come in a variety of shaft lengths and face angles, are designed for long, medium and short shots. Putters are used to stroke the ball gently, rolling it across the green and into the hole.

Oh, and the wedges? The people who design golf courses want to make the game challenging. One big challenge to avoid is the sand traps — large ditches along the fairway that the ball can land in. The wedge is a specialized kind of iron for getting the ball back out.

Woods of iron

The game of golf originated in Scotland around 600 years ago, and from the beginning until very recently, the woods — the long-distance clubs — were, as the name implies, made of wood. This changed in 1979, when a visionary named Gary Adams came up with the idea of making drivers and fairway woods out of steel. He thought it was such a good idea that he set up a factory in McHenry, Ill., and went into business as TaylorMade Golf Co.

“We believe in the pyramid of influence. Golf is an aspirational sport, which tends to feed down to the consumer.”
— John Gonsalves, TaylorMade

In its first year, TaylorMade had $47,000 in sales; it passed the $1 billion mark in 2006 and is now ranked among the top manufacturers of golf clubs, balls and accessories in the United States. The company was owned by Adidas and was acquired by KPS Capital Partners last year.

By far the most visible of TaylorMade’s customers are the top-ranked Professional Golf Association touring professionals who use its products. Among these are Dustin Johnson, the 2016 U.S. Open champion and world’s top-ranked player; Paula Creamer, the 2010 Women’s U.S. Open champion and a 10-time Ladies PGA tournament winner; and about 20 other highly ranked tour contenders.

Dreams of glory

In the U.S, there are somewhere around 10,000 teaching pros providing instruction at golf courses and country clubs. These people may not perform at the level of the top touring pros — the air gets pretty thin at the top in any competitive activity — but by and large, they are very good players. They can make effective use of the complex capabilities being engineered into today’s golf clubs.

Even if TaylorMade had all these players to itself — which it does not since Callaway, PING, Titleist and other brands are busy contesting for them — touring professionals, or even 10,000 employed professionals, do not constitute a market for a multibillion-dollar industry. You need more customers than that.

And there are more customers, conspicuous among them the people taking lessons from the 10,000 teaching pros. There are an estimated 25 million golfers in the U.S. today, according to the National Golf Foundation; 90 percent of them describe themselves as “passionate” about the game, which means they want to get better at it. And a fair number of them feel that having the very best and latest equipment will help them.

“We believe in the pyramid of influence,” says John Gonsalves, vice president of direct-to-consumer sales at TaylorMade. “That starts with the best players in the world, on down to top touring professionals, then down to the top-level golf professionals at the local golf courses, to the best-playing amateurs and so on.

“Golf is an aspirational sport, which tends to feed down to the consumer. We’ve been talking for some time about how to get golf clubs into their hands at a faster rate and help them keep up with the technological advances of the equipment.”

Buy to upgrade

In the spring of last year, TaylorMade launched a program called “The Turn” to enable its customers to do just that. A customer buys, say, a full set of irons for $1,000 and makes equal monthly payments for 12 or 24 months, depending on how much he is financing. Six months before the payoff date, he gets a choice: pay off the clubs he bought or trade them in for the latest and greatest. If customers upgrade, they return the old clubs, put the new ones in their golf bag and just keep on making payments. It’s a lot like leasing a car.

TaylorMade was aided in creating this program by Klarna, a Swedish ecommerce company that provides payment services for online storefronts. “We provide an open-ended line of credit that allows the consumer to very easily finance the purchase at the point of sale,” says Jim Lofgren, chief executive of Klarna North America. “It allows customers to return their clubs to TaylorMade in exchange for new ones without having to reapply.”

The Turn has been a win for both companies. For Klarna, it offers a chance to apply what it does to a whole new segment: top-end sports gear. As for TaylorMade, “A number of metrics show that the program is adding value,” Gonsalves says.

“Our average order value has increased by 5 percent, which is driven by The Turn. The average purchase through this program is $800, where our overall site-average order value is around $280. We’ve seen a sitewide 10 to 12 percent increase in conversion, and year-over-year sales have increased about 15 percent from the time we launched the program.”

A major test will come in April, which marks the beginning of golf season and the first upgrade opportunity for customers using The Turn. So far, the signs look promising. “A lot of customers start by just wanting to finance a purchase,” Gonsalves says. “As we talk to them, though, we find that after they’ve had the clubs in their hands for a while, the intent shifts from purchase to upgrade.”

Easy-to-upgrade golf clubs, in other words, may not be as revolutionary an idea as metal woods, but so far, the score is looking good.

Peter Johnston is a freelance writer and editor based in the New York City area.

“We believe in the pyramid of influence. Golf is an aspirational sport, which tends to feed down to the consumer.”
— John Gonsalves, TaylorMade

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