Report on Elevate Program Proposal

Indian Institute of Management Ahmedabad

Written analysis and communication (2017-18)

WAC Assignment - 3

Submitted by -

Name: Garvit Singh Katiyar        

Roll no: 17122

Section: B

Date: 2/09/2017

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Memo

To:        Evelyn Gracie & Austin Kai

From:  Garvit Singh Katiyar

Subject: Recommendation on the “Elevate” proposal.

The report contains the evaluation of the Elevate proposal program, its growth prospects and the projected figures for the year 2013. It includes the recommendation to proceed or not regarding the Programme.

Regards.

Garvit Singh Katiyar

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Executive Summary

Altius, the market leader in golf ball industry, is witnessing a decline in market share and sales after the recession of 2008. The main reason of which is declining trend throughout the industry and the interest of the golf players. Altius is the dominant player among the on-course retailers. But the completion has also snatched the market share of Altius in the off-course segment. Primiera has captured the market among the price sensitive consumers. Altius has planned to introduced the new Product line, Elevate. These are affordable products with a cheaper cost and profit margin of 66.2%. Its recommended to go with the plan without introducing the non-confirming balls.

Word Count – 109 words

Situation Analysis

After the recession in 2008, the golf industry is seeing a decline in sales of the golf equipment’s and overall interest in the sport. Golf being an expensive game with lots of on ground and off ground costs involved, saw a decrease in popularity as the disposable income of consumers declined during the recession. Around 23% of women and 36% of children had quit the sports after the recession. Investment in golf course real estate have also dip by 40%. Thus effecting the overall sales of every company in the industry. The revenue of Altius Golf from the Golf balls, which comprises of 60% revenues and 85% profits, took a hit by 15.26% from $314.6 million in 2008 to $266.6 million in 2012. (Exhibit 2)
        There has been a market shift in terms of consumer behavior and their preferences. There has been an increase in Agnostic, casual golfers who are at the beginning stage and the Enthusiasts, those who have a moderate frequency of playing. These consumers have a relatively high price sensitivity than the Loyalists, who are professionals. The former tend to prefer low cost equipment. Altius being the market leader with the premium product line have its product priced relatively high. Altius is losing out on these segment of consumers to the competitors like Primiera.