Cost leadership is being the producer of a given product at the lowest cost in that industry. Differentiation is when a firm provides a product or service that is unique or perceived to be different and superior by its customers from its competition. Focus occurs when a firm concentrates on a particular niche segment and attempts to satisfy the demands of that group. These businesses rely heavily on brand loyalty and may have lower sales volumes. Porter (2005) stressed distinct competitive advantages comes from a strong business strategy. Businesses need to objectively identify their strengths and identify how to be use them to respond to the larger environment. The generic strategies were appropriately named considering they may apply to any business. Ormanidhi (2008) agrees and describes how businesses who allocate effort to use Porter's generic strategies will generally outperform competitors who do not pursue such strategies.
The golf equipment industry is quite mature and saturated in the United States, and the largest impact on industry growth could be expected from a demographic shift in the core participant group, namely, the baby boomers, which is starting to happen now. The golf equipment industry has a broad spectrum of low-end to high-end manufacturers. Manufacturers include Spalding, MacGregor, and Dunlop set at the low end and mainly sell to amateur players (Damassa, 2007). The high-end manufacturers include Callaway, TaylorMade, Ping, Nike, and Titleist. These manufacturers sell professional equipment, catering towards more seasoned players, who mostly fall into the "core" participant group. The high end companies are able to extract higher margins on their sales because these Callaway's customer are less concerned with price, and more concerned with the quality of their purchase, and perhaps, the image/sense of prestige that comes along with the purchase (Damassa, 2007).
