SLRG's annual consumer outlook for the golf market was culled from a survey of over 1,100 avid golfer respondents. It was presented by Sports and Leisure Research Group President Jon Last, on January 28 to invited guests of Sports Illustrated Golf Group at the 2011 PGA Merchandise Show in Orlando, Florida.

1. The Golfer Mindset 2011
Presented January 28, 2011
Ready to Recover?
1

2. Agenda
• Two Minute Take-Aways
• Golfer expectations for 2011 perceptions, participation, spending and
retail channel preferences
• Golfer attitudes in 2011 and their implications for the industry
2

3. Two Minute Take-Aways
• The ―Hangover‖ lingers, but golfers perceive themselves to be
removed from its effects, as they slowly emerge from the ―cocoon.‖
• Golfers begin to find ―value‖ opportunities and that coincides with
heightened expectations. Service remains a key differentiator.
• Equipment innovation creates challenges (lack of loyalty;
differentiation) AND opportunities (demand, custom fitting). Off
course specialty benefits.
• Amidst significant membership losses, private club members are
concerned about future viability. Corrective action is slow in coming.
3

4. Background, Objectives and Methodology
• Winter 2011 SLRG Sports Omnibus
– Assess the attitudes and perceptions of golfers
– Control sample of non-sports fans
• Sports and Leisure Research Group launched the survey in January
2009, 2010 and 2011
• The 2011 online survey included 1,150 golfers
4

5. Golf’s Popularity: Less Mass but More Fans
Indicate whether you feel this sport has become more
popular, less popular or stayed the same over the past I watch and follow closely
two-three years
6% Net Change
64%
20%
PGA Tour Golf
PGA TOUR
47%
26%
11%
36%
LPGA
LPGA TOUR
14%
13%
- 23% Net Change
0% 10% 20% 30% 40% 50% 60% 70%
0% 5% 10% 15% 20% 25% 30% 35% 40%
Less Popular More Popular Winter 2011 Winter 2010
• LPGA tournaments drop from 34 in 2008 to 24 in 2010 Top 3 Box
5

6. Up Trend in Expectations….But There is a Gap Between
Expectations and Reality
• Do you expect to/Did you actually play the same • Do you expect to spend the same amount or more
amount or more in… next year?
100%
100% 96%
94%
90%
90%
80% 77% 77% 80% 76%
72%
70% 70% 66%
60% 60%
50% Expected 50%
40% Actual 40%
30% 30%
20% 20%
10% 10%
0% 0%
2009 2010 2011 2010 2011
Top 3 Box
6

7. Why Golfers are Playing More
Among those who expect to play more in 2011 (44% in 2011; 44% in 2010)
70%
60%61%
60%
50%
42%
40% 37%
31%30%
30%
22%
20%
18%19% 18%
20% 15%17% 16% 15%
14% 13%15% 13% 13%
11%
10% 6%
0%
I have more I have more My game has Family I have reduced My family is I've recently My health has There is better I've joined a I'm playing
time golf partners improved obligations business more involved bought new improved value in the golf league or more business
to play with have pressures in golf equipment marketplace local program golf
decreased
Winter 2010 Winter 2011
• Hierarchy remains unchanged Top 3 Box
7

8. Why Golfers are Playing Less
Among those who expect to play less in 2011 (4% in 2011; 7% in 2010)
47% 16%
I have less time It's harder to find people to play with
42% 14%
28% 15%
Family/Children responsibilities Golf is too expensive
25% 18%
26% My game has not improved or has 10%
Health reasons
31% gotten worse 11%
22% 8%
More business pressures Courses are too crowded
20% 7%
17% New golfers are making golf less 5%
Costs have gone up
22% enjoyable 5%
0% 10% 20% 30% 40% 50% 0% 5% 10% 15% 20%
Winter 2011 Winter 2010 Winter 2011 Winter 2010
Top 3 Box
8

9. Perceptions on New Equipment Purchasing:
• Innovation is still alive, but the process is complex
Mean 7.5
• Custom Fitting is a game changing opportunity
• Brand Loyalty remains compromised
60% 56% Mean 6.2
50%
38% 39%
40% Mean 6.1 37%
30%
30% 28%
24%
19%
20%
Mean 5.1 15%
10%
Mean 7.5 Mean 6.2 Mean 6.1 Mean 5.1 Mean 5.0
3%
0%
New golf equipment continues Buying new5.0 equipment has
Mean golf Buying the right new golf I won't buy new golf equipment I've found one brand of golf
to become more technologically become more complicated equipment can help me to without having a custom fitting equipment that I plan to stick
innovative every year process in recent years immediately improve my game first with, when I make my next
purchase
Top 3 Box Bottom 3 Box
Mean: 10 point scale
9

10. Golf Purchasing Trends; Actual Purchasing Incidence
Exceeded Expectation….and 2011 Shows Promise
80%
73%
70% 68%
60%
60% 57%
53%
50%
39%
40%
35% 34%
32%
30% 28%
27%
24%
21% 21% 22% 21% 21%
19%
20% 16% 17% 15%
14%
12% 13% 12%
9% 10% 9% 9% 9% 9% 10% 11%
10%
0%
Golf Balls Golf Apparel Golf Shoes Driver(s) Replacement Hybrids Other Faiyway Wedges Golf Bags Putters Irons
Grips Woods/Metals
Plan to Purchase in 2010 Purchased in 2010 Plan to Purchase in 2011
Top 3 Box
10

11. Spending Levels: Expectations Continue to Rise, but
Actual Purchases Generally Lag Them
Expected Purchasing Actual Purchasing
2011 $308 2010 $243
Drivers Drivers
2010 $271 2009 $221
2011 $245 2010 $192
Fairway Woods Fairway Woods
2010 $232 2009 $175
2011 $199 2010 $162
Hybrids Hybrids
2010 $178 2009 $161
$- $50 $100 $150 $200 $250 $300 $350 $- $50 $100 $150 $200 $250 $300
11

12. Spending Levels: Expectations Continue to Rise, but
Actual Purchases Generally Lag Them
Expected Purchasing Actual Purchasing
2011 $655 $498
2010
Irons Irons
2010 $550 $478
2009
2011 $161 2010 $149
Wedges Wedges
2010 $133 2009 $120
$138 2010 $127
2011
Putters Putters
$124 2009 $129
2010
$- $100 $200 $300 $400 $500 $600 $700 $- $100 $200 $300 $400 $500 $600
12

13. Spending Levels: Expectations Continue to Rise, but
Actual Purchases Generally Lag Them
Expected Purchasing Actual Purchasing
2011 $127 2010 $122
Golf Balls Golf Balls
2010 2009
$112 $115
2011 $119 2010 $117
Golf Shoes Golf Shoes
2010 $119 2009 $109
$216 2010 $215
2011
Golf Apparel Golf Apparel
$211 2009 $211
2010
$- $50 $100 $150 $200 $250 $- $50 $100 $150 $200 $250
13

14. Spending Levels: Expectations Continue to Rise, but
Actual Purchases Generally Lag Them
Expected Purchasing Actual Purchasing
2011 $78 2010 $68
Replacement Grips Replacement Grips
2010 2009
$68 $59
2011 $138 2010 $137
Golf Bags Golf Bags
$140 $120
2010 2009
$- $20 $40 $60 $80 $100 $120 $140 $160 $- $20 $40 $60 $80 $100 $120 $140 $160
14

15. In An Increasingly Value Driven Economy,
Service is Still a Differentiator
70%
64% 65%
61%
60%
50%
40%
34%
30%
23%
21%
20%
10%
0%
Quality service can make the ultimate difference in what I buy If I see something I like, I don't worry about the price
Winter 2009 Winter 2010 Winter 2011
Top 3 Box
15

16. After Temporary Aberration, Off-Course Specialty
Regains Primacy; Sporting Goods Still Formidable
Top Anticipated Purchase Channels for Golf Equipment
40% 37%
35%
35%
31%
30% 28%
25%
26% 25%
20%
20% 20%
15%
10%
5%
0%
Winter 2009 Summer 2009 Winter 2010 Winter 2011
Off-Course Specialty Sporting Goods Retail
16

17. Brand Loyalty May be Challenged;
But Familiar Names Stay Top of Mind
17

18. A Significant Minority of Country Club Members Are
Feeling Concerned About The Private Club Model
Private clubs in general, need to
make aggressive changes to remain Mean 6.9 49%
relevant in the coming years
• Less significant in the
My club must make aggressive
changes to remain viable in the 35%
South U.S.
Mean 6.1
coming years • More prevalent in West
than Mid-West
I'm concerned about the financial
Mean 5.7 35%
stability of my club
0% 20% 40% 60%
Top 3 Box
Mean: 10 point scale
Base: National Sample of Private Club Members
18

19. Efforts to Attract Juniors, Families and Women Are
Minimal. Nearly 1/3 Report Aggressive Discounting
50%
45% 43%
40%
35%
30%
30% Mean 6.8 27%
25%
25% Mean 5.3
20% Mean 6.0 17%
15% Mean 5.2
10% Mean 5.5
5%
0%
My club has made concerted My club has aggressively My club has been putting My club recently instituted a My club has been putting
efforts to attract younger reduced the cost of more emphasis on junior golf variety of new non-golf more emphasis on women's
members in the past few years membership to attract new programs recently programs to attract families golf programs recently
members over recent years
Top 3 Box
Mean: 10 point scale
Base: National Sample of Private Club Members
19

20. Country Club Members Estimate ―The Hit‖ to Membership
Levels—More than Half Report Losses
19% report a
gain in
membership
Membership
Level Over the
18% 22% 11% 29% 10% 6% 3%
Past Two
Years
Lost more than 10%
Lost between 5% and 10%
Lost less than 5%
Remained flat or consistent over the past two years
Increased by 5%
51% report a Increased by 5-10%
loss in Increased by more than 10%
membership
Base: National Sample of Private Club Members
20

21. Perceptions on Retirement Lifestyle: First, The Good
70%
62%
60%
54%
49%
50%
43% 44%
42% 42%
40% 39%
40% 36%
33%
30% 28%
22%
20%
14%
10%
0%
I'm confident that I will have I feel that I will be more I plan to scale down my lifestyle I plan to continue working even I invest so I can retire early
enough to retire in comfort comfortable in my retirement in my retirement in retirement
than my parents are/were
Winter 2009 Winter 2010 Winter 2011
Top 3 Box
21

22. But It’s Not All A Rosy Picture
0.7
61%
0.6
50% 51% 50%
0.5
45% 45% 45%
43%
0.4 38%
31%
29%
0.3
0.2
0.1
0
I'm looking forward to my I consider myself to be health The best years of my life are still Age 60 is the new 40 This year will be a better year
"golden years" conscious to come for me than last year
Winter 2009 Winter 2010 Winter 2011
Top 3 Box
22

23. Trend to Watch: Are Golfers Breaking Out of the
Cocoon???
70%
60%
60% 58%
50%
50% 47%
39%
40%
31%
30%
24%
20%
15%
10%
0%
I'm spending more time at home than I I'd rather spend time with family than I'm spending more time these days with Spending time with and caring for
did two years ago with friends or business associates friends and family, than I did in the past children and aging parents will reduce
the time I can dedicate to playing sports
and attending sporting events
Winter 2010 Winter 2011
Top 3 Box
23

24. But Child Centricity and Ubiquitous Technology Remain
an Impediment
90%
81%
80%
72% 73%
70% 65% 65%
60%
60%
50% 48%
41%
39%
40%
34%
30% 26%
20%
10%
0%
There's too much new technology to We live in an age of constent updates The world is less safe for children today Golf is my personal "oasis" from day-to-
keep up with than when I was growing up day chaos
Winter 2009 Winter 2010 Winter 2011
Top 3 Box
24

25. Golfers Still Question the Economy…
70%
63%
60%
60%
50%
40%
31%
30%
24%
20%
10% 6%
4%
0%
There's really no such thing as job security any more We have seen the U.S. unemployment rate reach People will go back to spending freely on luxuries
bottom, and it will add jobs in 2011 again in 2011
Winter 2010 Winter 2011
Top 3 Box
25

26. …But They Feel Better About Themselves!!
60%
55%
50% 47%
46%
44%
42%
40%
34%
32%
30% 27%
20%
10%
0%
I'm more budget conscious today than I Today, I have to make more difficult I feel better about my financial situation I'm planning to take a major vacation
was two years ago decisions about purchases than I did 5 today than I did a year ago this year
years ago
Winter 2010 Winter 2011
Top 3 Box
26

27. Attitudes: Tiger Can Come Back…But It’s Still All About
The Golf
80%
70% 68%
60%
Mean 7.8
50%
43% 43%
40% 35%
32%
28% 29%
30%
20%
20%
Mean 6.6 Mean 7.0 Mean 6.3
10% 7% 6%
0%
I'm interested in learning Once an athlete becomes a Professional athletes are Tiger Woods will I expect Tiger Woods to The golfing public is
more about the private public figure, it is role models ultimately go down in make a big comeback on rooting for Tiger Woods to
lives of top sports stars acceptable for his or her history as the greatest the PGA TOUR in 2011 come back strong in 2011
private life to be open to golfer of all time
public scrutiny
Winter 2010 Top 3 Box Winter 2011 Top 3 Box
Mean: 10 point scale
27

28. So… What Does This All Mean For Golf Marketing?
• Messaging and Marketing Communication should be sensitive to these cultural
and perceptual realities:
• Emphasis on Personalization and heightened service
• With the proliferation of new products, ―guidance‖ is still coveted
• Acknowledgement of more ―grounded and pragmatic‖ values, while
harkening back to the nostalgia of simpler times and a desire to enjoy
them.
• Private clubs need to evolve with ―The Sandwich‖ Generation and seize
the opportunity to provide ―real time relevance,‖ escape and family
focus
• Continue to tone down “conspicuous consumption” imagery and
messaging, given lingering sensitivity and economic uncertainty
28