Inesis Golf and The Concept of “Fair” Pricing (MyGolfSpy.com)
Inesis Golf isn’t the first company to offer the concept of “fair” pricing and it won’t be the last. But it is one of the few companies in golf that will tell you exactly what it means by fair pricing and how it gets there.
In 2021, that might be as transparent as you can get.
Inesis, as you’ve read on these pages before, is the golf-specific brand of $12-billion sporting goods giant Decathlon. Based in France, Decathlon has built a unique operation that’s as vertically integrated as a company can get in this day and age.
Decathlon’s goal? “To make sure the pleasure and benefits of enjoying sports are sustainable and accessible for as many people as possible.”
Whether it’s a Tour-level golf ball at $30 per dozen, a laser rangefinder for less than $200 or a set of irons for less than $500, Inesis is all about accessible. And when Inesis says accessible, it means affordable. It does not, however, mean cheap.
So what does “fair” pricing really mean? Where does it come from and is it an idea that resonates with golfers? That’s what we’re here to explore.
That, my friends, is a fundamental truth. A high price makes a positive, salutary statement while a low price tends to make a negative, derogatory statement. Yet, even within that fundamental truth, there’s plenty of conflict.
Yes, everyone “loves a bargain.” But don’t you also “get what you pay for”? While we’re neck-deep in clichès, isn’t it also said a fool and his money are soon parted; that you can be penny-wise and pound-foolish?
The marketing machine is of no help when it comes to resolving this conundrum. Whether it’s the result of a lifetime of advertising-fueled conditioning or just simple economics, it’s very difficult for the brain to believe that something of a significantly lower price can possibly have equal-to or greater-than performance. For most of us, even close-enough performance simply does not compute.
So, what makes Inesis think it can pull this off?
Two things: transparency and validation.
When it comes to transparency, Inesis Golf isn’t about to give you a detailed Cost of Goods Sold breakdown. But it will tell you the cost to produce its Tour 900 golf ball is about the same as the cost to produce a ProV1, TP5 or Tour B X. However, you can buy the Tour 900 for $29.99 per dozen. The others, well, you can’t. So why the big difference in selling price? Inesis says you can find it filed under useless.
The Decathlon/Inesis Golf corporate mantra is to focus on the useful and skip the useless. Useful is a well-designed, aesthetically pleasing product that meets a golfer’s needs and performs with the best. Useless is pretty much everything else.
When Inesis says, “We don’t want to make you pay for anything that won’t benefit your game,” what specifically are they talking about? Advertising, marketing and packaging, for three. Make no mistake, those three items help move products at retail but none of them helps you stick a 5-iron close from 185 yards out.
Just how much of the ProV1’s $49.99 price tag goes to support Tour sponsorship is up for discussion but it might not be as much as you think. Remember, Cost of Goods Sold is what it costs to actually make golf balls. Marketing costs (including Tour support), sales and office support expenses, shipping, receiving, accounting, other corporate overhead, backend deals and profit are all wrapped up in the wholesale price. That’s what Titleist charges DICK’S, PGA TOUR SuperStore and others. The retailer then wets its beak by selling at the MSRP.
With Inesis, there’s only one beak to wet. You can call it direct-to-consumer or you can call it cutting out the middleman. Essentially, you’re buying at wholesale prices. And, yes, even though Decathlon sells via its own website (and a couple of Northern California retail locations), you can buy Inesis from Walmart online. If you look closely though, you’ll see the products are “sold and shipped by Decathlon USA LLC.” Walmart obviously gets a commission but never actually owns or touches the products.
When it comes to useless, there may be nothing more useless, in the Inesis definition at least, than the box golf balls come in. Or should we say boxes.
Yes, packaging is part of the, uh, package. But packaging is all about shelf appeal. And shelf appeal really only matters when a product is on an actual shelf at retail, vying for your attention alongside dozens of competitors. So yeah, shelf appeal is important but golf ball packaging, while traditional, borders on the silly. Three balls go into a small box and then four of those small boxes go into a bigger box. The OEM puts considerable effort into making the box look shiny and cool so you’ll buy it. And when you buy it, you wind up throwing five total boxes away.
“We want an attractive ball but we don’t need it to be a masterpiece,” says Inesis Golf in its literature. Golf balls are, after all consumable; you’re going to lose them. Inesis takes the same practical and utilitarian approach with its packaging. The packaging is still traditional, with four small boxes inside one larger box, but it’s also minimalist. You’ll see the requisite imagery along with features and benefits but Inesis won’t be hiring a team of graphic designers to come up with an art museum-level package trimmed with a metallic lilt.
Why, you may ask, can’t Titleist, TaylorMade or Bridgestone simply sell balls on their own websites at wholesale prices? The answer to that should be obvious but in case it isn’t, here goes.
When you rely on retail distribution (green grass, big box and online) for nearly all your sales, those retailers are, in a sense, your business partners. And Rule #1 in the Smart Business Handbook says don’t stab your business partners in the back. That said, you can certainly buy a dozen Tour B X balls on Bridgestone’s website but you won’t find them underselling their retail partners.
And while the combo of COVID-19 and the worldwide web has many doom ‘n’ gloomers predicting the death of brick-and-mortar retail, the retail concept isn’t going anywhere. And the reason is simple. It remains a fast, easy, efficient and inexpensive way to move mass amounts of merchandise from the manufacturer to the people who will use it.
Without retail, Callaway or TaylorMade would have to set up their own network of retail outlets nationwide. And while it may sound like fun, crossing town to demo the latest from TaylorMade, Callaway, COBRA and PING at their own outlet stores might be more effort than golfers are willing to exert. And when you add in the expense of leasing, staffing and stocking those stores, the price to the consumer would probably wind up being higher.
While Decathlon’s U.S. retail network is still in its infancy, the company’s vertical integration works to its advantage. Since Decathlon is a sporting goods supplier, its retail outlets carry all its equipment. You want a bike, they have bikes. You want backpacks or sleeping bags? They have those, too.
Yoga mats? Yep.
Inesis Golf equipment is simply one aspect of the Decathlon retail footprint and another page on the website.
Ultimately, fair, like beauty, is in the eyes of the beholder. In MyGolfSpy’s big golf ball test back in 2019, the Inesis Golf Tour 900 rated as a Very Good performer on par with the Bridgestone Tour B XS, the TaylorMade TP5/TP5X, the Srixon Z Star XV and the Snell MBT X. On a per-box basis, the Inesis is the lowest priced of the bunch, not taking Snell’s bulk pricing into account.
At $29.99 dozen in white, that certainly sounds fair, doesn’t it?
The challenge for Inesis, however, is that golfers are NOT price-buyers. We may think we are and we may act as though we are but we’re not. And the evidence is irrefutable.
Consider this: the Callaway Mavrik and TaylorMade SIM were 2020’s top-selling drivers. They were also among 2020’s most expensive drivers. The ProV1/AVX family more than doubled the sales of the Srixon Z Star family in 2020, even with a 33-percent higher selling price.
We may decry the ridiculousness of those prices but it doesn’t stop us from paying them.
As we said earlier, price does make a statement as to expected performance and quality. But as we also said, Inesis insists the cost to produce its Tour 900 ball is not much different than the cost to produce a ProV1. The nearly $20 difference in selling price comes from added costs Inesis considers “useless.”
Whether those costs truly are useless is ultimately up to you as a consumer.
The post Inesis Golf and The Concept of “Fair” Pricing appeared first on MyGolfSpy.
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Key Takeaways
- Inesis—the golf brand of sporting goods giant Decathlon—wants to define “fair” pricing for the golfer.
- The company says its Tour 900 urethane golf ball costs the same to produce as the ProV1, TP5 and others.
- At $29.99 per dozen, the price difference comes from streamlined production and eliminating “useless” costs.
Inesis Golf isn’t the first company to offer the concept of “fair” pricing and it won’t be the last. But it is one of the few companies in golf that will tell you exactly what it means by fair pricing and how it gets there.
In 2021, that might be as transparent as you can get.
Inesis, as you’ve read on these pages before, is the golf-specific brand of $12-billion sporting goods giant Decathlon. Based in France, Decathlon has built a unique operation that’s as vertically integrated as a company can get in this day and age.
Decathlon’s goal? “To make sure the pleasure and benefits of enjoying sports are sustainable and accessible for as many people as possible.”
Whether it’s a Tour-level golf ball at $30 per dozen, a laser rangefinder for less than $200 or a set of irons for less than $500, Inesis is all about accessible. And when Inesis says accessible, it means affordable. It does not, however, mean cheap.
So what does “fair” pricing really mean? Where does it come from and is it an idea that resonates with golfers? That’s what we’re here to explore.
Price Makes a Statement
That, my friends, is a fundamental truth. A high price makes a positive, salutary statement while a low price tends to make a negative, derogatory statement. Yet, even within that fundamental truth, there’s plenty of conflict.
Yes, everyone “loves a bargain.” But don’t you also “get what you pay for”? While we’re neck-deep in clichès, isn’t it also said a fool and his money are soon parted; that you can be penny-wise and pound-foolish?
The marketing machine is of no help when it comes to resolving this conundrum. Whether it’s the result of a lifetime of advertising-fueled conditioning or just simple economics, it’s very difficult for the brain to believe that something of a significantly lower price can possibly have equal-to or greater-than performance. For most of us, even close-enough performance simply does not compute.
So, what makes Inesis think it can pull this off?
Two things: transparency and validation.
When it comes to transparency, Inesis Golf isn’t about to give you a detailed Cost of Goods Sold breakdown. But it will tell you the cost to produce its Tour 900 golf ball is about the same as the cost to produce a ProV1, TP5 or Tour B X. However, you can buy the Tour 900 for $29.99 per dozen. The others, well, you can’t. So why the big difference in selling price? Inesis says you can find it filed under useless.
Inesis Golf: Useful Versus Useless
The Decathlon/Inesis Golf corporate mantra is to focus on the useful and skip the useless. Useful is a well-designed, aesthetically pleasing product that meets a golfer’s needs and performs with the best. Useless is pretty much everything else.
When Inesis says, “We don’t want to make you pay for anything that won’t benefit your game,” what specifically are they talking about? Advertising, marketing and packaging, for three. Make no mistake, those three items help move products at retail but none of them helps you stick a 5-iron close from 185 yards out.
Just how much of the ProV1’s $49.99 price tag goes to support Tour sponsorship is up for discussion but it might not be as much as you think. Remember, Cost of Goods Sold is what it costs to actually make golf balls. Marketing costs (including Tour support), sales and office support expenses, shipping, receiving, accounting, other corporate overhead, backend deals and profit are all wrapped up in the wholesale price. That’s what Titleist charges DICK’S, PGA TOUR SuperStore and others. The retailer then wets its beak by selling at the MSRP.
With Inesis, there’s only one beak to wet. You can call it direct-to-consumer or you can call it cutting out the middleman. Essentially, you’re buying at wholesale prices. And, yes, even though Decathlon sells via its own website (and a couple of Northern California retail locations), you can buy Inesis from Walmart online. If you look closely though, you’ll see the products are “sold and shipped by Decathlon USA LLC.” Walmart obviously gets a commission but never actually owns or touches the products.
Even the Box Matters
When it comes to useless, there may be nothing more useless, in the Inesis definition at least, than the box golf balls come in. Or should we say boxes.
Yes, packaging is part of the, uh, package. But packaging is all about shelf appeal. And shelf appeal really only matters when a product is on an actual shelf at retail, vying for your attention alongside dozens of competitors. So yeah, shelf appeal is important but golf ball packaging, while traditional, borders on the silly. Three balls go into a small box and then four of those small boxes go into a bigger box. The OEM puts considerable effort into making the box look shiny and cool so you’ll buy it. And when you buy it, you wind up throwing five total boxes away.
“We want an attractive ball but we don’t need it to be a masterpiece,” says Inesis Golf in its literature. Golf balls are, after all consumable; you’re going to lose them. Inesis takes the same practical and utilitarian approach with its packaging. The packaging is still traditional, with four small boxes inside one larger box, but it’s also minimalist. You’ll see the requisite imagery along with features and benefits but Inesis won’t be hiring a team of graphic designers to come up with an art museum-level package trimmed with a metallic lilt.
Retail’s Golden Handcuffs
Why, you may ask, can’t Titleist, TaylorMade or Bridgestone simply sell balls on their own websites at wholesale prices? The answer to that should be obvious but in case it isn’t, here goes.
When you rely on retail distribution (green grass, big box and online) for nearly all your sales, those retailers are, in a sense, your business partners. And Rule #1 in the Smart Business Handbook says don’t stab your business partners in the back. That said, you can certainly buy a dozen Tour B X balls on Bridgestone’s website but you won’t find them underselling their retail partners.
And while the combo of COVID-19 and the worldwide web has many doom ‘n’ gloomers predicting the death of brick-and-mortar retail, the retail concept isn’t going anywhere. And the reason is simple. It remains a fast, easy, efficient and inexpensive way to move mass amounts of merchandise from the manufacturer to the people who will use it.
Without retail, Callaway or TaylorMade would have to set up their own network of retail outlets nationwide. And while it may sound like fun, crossing town to demo the latest from TaylorMade, Callaway, COBRA and PING at their own outlet stores might be more effort than golfers are willing to exert. And when you add in the expense of leasing, staffing and stocking those stores, the price to the consumer would probably wind up being higher.
While Decathlon’s U.S. retail network is still in its infancy, the company’s vertical integration works to its advantage. Since Decathlon is a sporting goods supplier, its retail outlets carry all its equipment. You want a bike, they have bikes. You want backpacks or sleeping bags? They have those, too.
Yoga mats? Yep.
Inesis Golf equipment is simply one aspect of the Decathlon retail footprint and another page on the website.
Inesis Golf: What IS a “Fair” Price?
Ultimately, fair, like beauty, is in the eyes of the beholder. In MyGolfSpy’s big golf ball test back in 2019, the Inesis Golf Tour 900 rated as a Very Good performer on par with the Bridgestone Tour B XS, the TaylorMade TP5/TP5X, the Srixon Z Star XV and the Snell MBT X. On a per-box basis, the Inesis is the lowest priced of the bunch, not taking Snell’s bulk pricing into account.
At $29.99 dozen in white, that certainly sounds fair, doesn’t it?
The challenge for Inesis, however, is that golfers are NOT price-buyers. We may think we are and we may act as though we are but we’re not. And the evidence is irrefutable.
Consider this: the Callaway Mavrik and TaylorMade SIM were 2020’s top-selling drivers. They were also among 2020’s most expensive drivers. The ProV1/AVX family more than doubled the sales of the Srixon Z Star family in 2020, even with a 33-percent higher selling price.
We may decry the ridiculousness of those prices but it doesn’t stop us from paying them.
As we said earlier, price does make a statement as to expected performance and quality. But as we also said, Inesis insists the cost to produce its Tour 900 ball is not much different than the cost to produce a ProV1. The nearly $20 difference in selling price comes from added costs Inesis considers “useless.”
Whether those costs truly are useless is ultimately up to you as a consumer.
The post Inesis Golf and The Concept of “Fair” Pricing appeared first on MyGolfSpy.
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