TaylorMade Innovates As Corporate Strategy

Businessweek has a nice article on how TaylorMade has turned innovation into a company strategy.

When TaylorMade Golf’s R9 hits retailers in March, it will be the 45th new metal driver the company has produced since 2003. Thanks to that torrent of product introductions, the Adidas subsidiary has more than doubled its annual revenue, to $1.3 billion, catching up with once-larger rivals Callaway Golf (ELY) and Acushnet and rising to the top in sales of drivers, the game’s priciest clubs.

Chief Executive Officer Mark King calls the company’s lickety-split rollout schedule “relentless innovation.” It’s an idea he imported from Japan, where, during a 2000 business trip, he saw how Japanese golf-equipment manufacturers were trouncing leisurely paced American leaders by turning out new products much more often. Before yearend, he hired an executive from United Parcel Service UPS to revamp TaylorMade’s supply chain so it could step up operations. Within five years, he doubled the money spent on marketing. All the effort paid off: Customers eager for that latest club paid prices that were as much as $100 more than what rivals charged.

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2 thoughts on “TaylorMade Innovates As Corporate Strategy”

  1. I’m not so sure that they’re making cosmetic changes as much as tinkering at the margins. Few of the products they’ve released recently have been “breakthroughs,” but rather, incremental increases in MOI, etc.

    It works for them, and it works for me. In recent months, I picked up a TaylorMade hybrid that was a couple of generations old. It was at fire-sale prices.

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  2. The strategy used by TaylorMade certainly appears to have succeeded for them.  One has to wonder if the changes are truly innovation and not primarily cosmetic.  The process of continual innovation sounds a lot like Detroit’s annual model changes of the 1950’s and 1960’s.  Adding fins and then taking them off certainly worked for Detroit for a while.

    I am not really TaylorMade’s target market anyway.  I have never been that interested in all the technical details of golf club design. All the talk of “MOI”, kick points, and torque tend to pass me by. I also am frugal with my golf dollar.  I typically buy used or year or two old models once they hit the discount rack. 

    There are always going to be some golfers who desire the latest and hottest clubs.  It is also possible that there will be some golfers who will start to stay away from TaylorMade because there are too many models and one’s purchase becomes out-of-date too quickly.

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