Introduction:GolfLogix has developed a small, GPS-based device to help golfers track their play. With the fact that GolfLogix has two devices it is trying to sell: a distance-only device and a complete device, currently the company meets a problem that how best to distribute their devices: under the current leasing relationship with golf courses, whether should the company still need to market a direct-to-consumer version of the Distance Only xCaddie?Analysis:Retail channel: Advantages: 1)To increase adoption by individual consumers thus putting pressure on the courses to buy into the complete system. 2) To provide a complementary source of revenue. Disadvantages: 1)The personal xCaddies would be useless on courses which were not already mapped out. Newly mapped courses could not automatically be added to the library of courses on existing devices. 2)A rising personal ownership of xCaddies may discourage courses from leasing their own devices. This means that the continual revenue from leasing would disappear and only an one time revenue for selling the xCaddie would remain.
If the retail channel is pursued, customers would expect all courses they frequent to be mapped involving a large incremental cost for each golf course.(see exhibit 1) On the other hand, individual xCaddie owners may demand that their own favorite golf courses be mapped even if it does not make economic sense for GolfLogix to do so.
Competitors: The xCaddieÃ¦ÂÂ¯ main competitors are Cart-mounted and PDA system targeting the same niche market. the PDA-based system has advantages in price point and various features, especially the ability to upload and download user-calibrated course mappings. The cart-mounted system has a competitive advantage in GPS-based video.The need for these products can be considered a barrier to enter for xCaddie owners.
Customers: For golf courses, the main benefit in leasing the xCaddies is an improved pace...