He said that even major golf manufacturers will eventually sell clubs and balls directly to consumers, or D2C as business insiders call it.
Takomo Golf is already involved in D2C. It is based in Finland and its motto is “Premium Golf Equipment at Affordable Prices”. Just that was done by Sebastian Happahové, CEO of Takomo Golf.
Takomo launched their Model 101 irons in early 2021. They were indulgent, hollow body game improvement clubs that are nonetheless attractive. A few months later, the Iron Model 201 appeared, a forged club-back with a bore for low- and medium-handicap players. It also comes standard with Lamkin knobs and premium KBS shafts. Takomo recently added 301 irons that are available for pre-order only. They are forged and designed for good gamers and come in zigzag or muscular versions.
Does it look expensive? Guess again. 101 irons start at $459 (4 irons through wedge); 201s at $589; 301s at $649. Other shipping costs $50.
Happahovy, who came from the IT sector but got into golf after being stunned by the prices of the new clubs, talks with Gary Van Sickle of The First Call about his company’s business plan and future.
First call: Tell me about the trend of selling golf companies directly to consumers.
Sebastian Habahofi: During Covid when everything was shut down, it started to grow very quickly. Consumers want to buy online. They are used to it and can get golf gear wherever they are. There is no availability in all places in the world. So this is a real big opportunity for us.
TFC: Nobody wants to admit it but online shopping is fun.
u: This is correct. I’ve seen a lot of late night purchases. It’s almost like eating before you go to bed, but instead of a snack, you can buy gifts online.
TFC: Who or what started the concept of direct consumer communication in golf?
u: PXG had their own online store right away, and I guess they didn’t have a distribution network at first. I don’t know if they consider themselves a direct-to-consumer company but that might be where it all started on the equipment side. A few others were doing the same with golf balls about ten years ago.
TFC: You are based in Finland. Is direct-to-consumer as big in Europe as it is in the US?
u: About 60 percent of our orders come from the US right now, so it’s bigger there. Online buying is a bigger trend in the US, anyway, but of course everything is growing in Europe. The problem is that European markets are scattered. We have several different languages, which makes it difficult for us to serve every audience. You have over 20 million golfers in the US and Europe isn’t even half that number. That’s why the United States is moving more than Europe.
TFC: Who is your main competitor in D2C – direct-to-consumer? Who are you competing with?
u: Compared to the Sub 70 a lot, it performed well. They are based in Illinois. Also, our price point is very close to used club rates. Many of our customers comment that they went with us because they got brand new clubs in the price range of second-hand clubs that are 2 years old.
TFC: How do you build brand awareness when you’re only online?
u: Internet influencers have been huge for us. YouTube reviews, people looking for new clubs. They mainly use YouTube as a search engine. So when we are flagged by influencers or reviewed on YouTube, that’s a really big help for us. We’re not looking to sponsor any players on the tours because I think we need to be where our actual audience is and that’s online. I feel caring for the tour players, that’s the way of the ancient dinosaurs. Now, if round players aren’t playing your stuff, what does it matter? If your name was written on the bag and they didn’t play for your clubs, what difference would that make? American companies have used this model for years.
TFC: You have to sell a lot of clubs and balls to pay Davis Love III or anyone else 2 million a year. Does not make sense.
u: I think consumers are smart enough to know that they are not playing the same equipment as the pros. It’s not like the old days. This model is dying and the consumer knows that it is not free for them to play the equipment of the great company. They are actually paying for endorsements and that’s part of the reason why clubs are so expensive now.
TFC: I didn’t think I’d see the day a chauffeur would cost more than $500. And once one company jumped their price above $500, they all jumped, too. In business, successful companies are usually the first, the best, or the cheapest. The big golf companies do all this marketing, saying things that may or may not be true, but there’s always a market for good, inexpensive golf clubs, and that’s clearly what you’re after.
u: exactly. I was looking at Fairway Woods, because we launched our own brand of Fairway Woods at the end of this year. I saw one of the big big brands had Fairway lumber prices around $500. To me, that doesn’t seem right. I got an email from a company that says they have lowered their wooden price from $499 to $349.
TFC: That’s the price I want to pay the driver, not the price for proper lumber.
u: This is likely with an arrow column that you probably don’t want. Then you have to pay more to get a better column. I don’t know if it’s because of the recession but everyone knows the price these days. If you go shopping for new clubs, you are in for a shock.
TFC: This should be pretty cool for you, right?
u: Yes, yes, of course but there is a lot of pressure on us as well, because the prices of logistics and raw materials are going up. Our prices for shipping from Hong Kong have doubled in the last year.
TFC: That’s crazy.
u: But since there are no distributors or resellers, we have better margins for our products. That’s why we can keep our prices very low.