The Water Cooler - The PGA Merchandise Show pt. 1

We visited Orlando this year to take in the PGA Merchandise Show.  It's not what it once was.  By definition, the event is about introducing new golf merchandise to the professional golfer.  That’s the idea anyway.  If you have never attended the PGA Show, it was, at one time, an awe-inspiring event.  Everyone who was someone within the industry would attend, top teachers, the best players, PGA leadership, and even the occasional PGA Tour pro.  Attendance would top 60,000 members of the golf industry, general public not invited, and would encompass every square inch of the Orange County Convention Center AND the neighboring hotel convention floors.  (More than 1 million square feet!)  Every major golf manufacturer attended in an effort to battle for the golf professional’s eye, heart, and most importantly pro shop dollar.  The concept was clear, golf professionals, responsible for purchasing products that would be sold in their golf shops during the year, would visit the PGA Show for a “one stop shopping” experience.  They could see it all in 4 days… 4 long, intense, tiring days.  There was a time when the PGA Show was one of the largest trade shows in the US, rivaling the automotive and electronics shows of the 90’s and 00’s.  As a golf professional you set appointments, needed a map and a game plan to get everywhere you needed to be, and might even require a small wagon to carry all the paraphernalia you would acquire during your trek.  Golf pros that counted their steps each day, broke records during the show and notoriously the guy who wore dress shoes on day one would be seen in sneakers by day 3.  There were demo days, launch parties, staff parties, end of day beerfests and in general, the PGA Show was “The Masters” of the golf merchandise business.  Biggest event of the year, bar none.  (Side note.  More business may have gotten done at the hotel bars after show hours than during on the show floor.)

The PGA Merchandise Show is not owned by the PGA of America.  It was sold to Reed Exposition Services in 1998.  For a few years beyond that watermark date the show thrived, thank you Tiger.  But what also thrived was the pocketbook of the new ownership of the show, Reed Exhibitions.  Costs got exorbitant, not all Reed’s fault, but when companies like TaylorMade and Callaway started spending more than $1 million to attend the show, the big boys started to rethink the value of the trade show.  As one top executive explained, “one of the reasons for attending the ‘PGA’ Show was to support the ‘PGA’, now we are basically lining Reed Expositions pockets.  The show isn’t even breakeven for us.”  Larger companies started to reimagine what they could do with the extra marketing money if it wasn’t spent on 4 days at the show.  What if they didn’t pay $6,000+ for every 10 square feet, didn’t fly and house over 100 people in Orlando for 5 or six days, and didn’t pay to ship, build, rent, and tear down literal buildings of a trade show booth every year?  They could spend that money driving consumers to the pro shop instead of bringing the owners of the pro shops to their overpriced rental displays.

New strategy for those that could afford it and one by one the largest of the golf manufacturers stopped attending the PGA Merchandise Show and changed their marketing spends.  As a consumer, you see it in additional advertising, more demo days at your clubs, intricate fitting systems located in buildings allocated to just one company, more players using their equipment.  The golf pro?  They got the short end.  They get to see a sales representative a couple of times a year, must buy pre-packed orders that include items they probably wouldn’t have bought, and their margins have steadily decreased on the most popular (and expensive) items.  Why?  The equipment companies believe they have changed the buying process.  They believe that instead of the golf pro convincing their members they have identified the best products for the member and then selling it to their customer, the equipment companies tell the golf pro, “We created the market.  We drive ‘our’ customers into your shops.  All you have to do is stock the item.”  To add insult to financial injury, the golf professional must now compete with the very manufacturer he is expected to support because now, except for Ping, just about every major equipment company sells direct to the consumer through their own website.  With all that working against them, carrying some high-end hard goods for many golf professionals is no longer something they want, or can afford, to do.  You know the golf shops.  Walk in to many a public golf course and look around, there aren’t many $500+ drivers hanging around are there?  I know it may seem like a leap but blame the PGA of America and the sales of the PGA Merchandise Show to Reed Expositions.  They started it.