For manufacturers, the push to reduce how far the golf ball travels has long been building on their business horizons like darkening thunderheads. Now that gathering storm is breaking, thanks to a decision by the USGA and R&A to institute an across-the-board rollback.
The action is expected to be announced formally by golf’s governing bodies this week.
It is a big deal to Titleist, which is the leading ball maker in the world and last year recorded nearly $700 million in sales from that product line. The move also matters to Topgolf Callaway, which has a ball franchise that produced a tad more than $300 million in revenue in 2022. And the rollback will no doubt cause them and other major ball brands such as Bridgestone, Srixon and TaylorMade much consternation. It will generate uncertainty in a highly competitive market and cost them millions of dollars to retool plants, ramp up research and development efforts to create new products, hire additional employees to help carry out those initiatives and develop advertising and marketing strategies to make golfers feel good about a ball that is expected to be in some estimations 4-6 yards shorter off the tee for recreational golfers.
But how deeply will that step by golf’s governing bodies actually impact their businesses and bottom lines? And will the sport, which has been on a remarkable run in terms of popularity and participation since the pandemic, suffer as a result of these moves?
“The smaller ball makers will suffer. But the major manufacturers who have the money, staffing, technology and scale to adjust to these changes will be fine.”
Casey Alexander
That last concern is an especially salient one among industry watchers as it relates to the newer arrivals to the game who tend to wear their shirt tails out, play music during their rounds and don’t particularly like authority figures, a disdain that will now probably include old guys in blue blazers telling them that they have to hit their golf shots shorter.
Those are good questions. And the answers to them might come as a surprise, for it appears that neither the game nor its most prominent ball makers are likely to be irreparably harmed by this halt in golf ball distance. Inconvenienced, to be sure. Irritated, too. And in the case of the ball makers, nicked financially in the short term. But the overall long-term damage should be minimal.
“The smaller ball makers will suffer,” said Casey Alexander, an analyst with Compass Point Research & Trading who follows the golf industry. “But the major manufacturers who have the money, staffing, technology and scale to adjust to these changes will be fine. In fact, the rollback might even create some opportunity for them in terms of developing new products and creating new points of difference between their golf balls and those of the competition.”
And the fact that the rollback is across the board and not bifurcating the ball business means the companies that have long touted their golf ball brands based on their use by tour professionals will not have to change marketing approaches.
Another factor in the ball makers’ favor is the lead time they have to make this transition, with some companies having begun preparation for this action more than a year ago as they put together budgets and strategic plans for 2023.
“This is a much different situation than what occurred back in 2000 for Titleist when Tiger Woods decided to start playing a solid core ball by Nike and the whole golf world suddenly decided to stop using wound balls, which at the time was the product on which the Titleist brand was built,” Alexander said. “That was a much tenser moment because it was player driven, not instigated by the governing bodies, and that Titleist had to adjust rapidly and innovate on the fly.”
Golf retailers may also benefit from this move due to the hoarding that inevitably will occur as the deadline for switching to the new ball (January 1, 2030 for recreational players) approaches and pre-prohibition Pro V1s and other previous generation ball products start flying off the shelves.
As for golfers themselves, Alexander acknowledges that many will not be happy about losing a few yards on their drives or approach shots. A number will complain about the decision, and some may even refuse to abide by the new rule after it takes effect.
“But I do not see anyone being so distraught by the rollback that they quit the game,” he said.
That may be so, but will it affect the frequency with which they play and their overall enthusiasm for the game?
It is easy to understand why so many are fretting over this decision, especially when one considers that with the rollback, golf has become the rare sport ever to move backwards from technological innovation for both professional and recreational participants. And the fact that this is happening at a time of almost unprecedented prosperity in the game only deepens the worry.
But while this rollback will indeed be disruptive, the evidence indicates that the business of golf and the game as it is enjoyed by tour professionals and weekend hackers alike will weather this storm just fine.