As its nearly-three-year-old Topgolf entertainment division continues to mature, Topgolf Callaway Brands (MODG: NYSE) has created a new commercial and digital team within Topgolf dedicated to optimizing revenue management and driving our digital business.
Along that same line, the company is moving forward is initiating more cross-branding strategies between its entertainment division and its Callaway equipment division.
Among the digital initiatives at Topgolf:
– Shortening the time ahead of a reservation, where you can book a reservation from three hours to two hours – and shorter over time
– Variable length reservations Topgolf previously only offered two hours, but in Q2, it plans mixing in 90 minutes on its one- and two-bay offerings, and 150 minutes on two-bay events.
Earlier availability for one- and two-bay reservations: Currently, guests can book reservations seven days in advance. Topgolf expects to move to 14 days in all venues in Q2.
Topgolf Callaway Brands CEO/President Chip Brewer said a company-wide consumer data platform is expected to be up and running by the second half of this year.
“This important project,’’ Brewer said, “will unlock digital synergies across the brands and is expected to be a significant catalyst for future growth opportunities across our brand portfolio.’’
Specifically, in regards to cross-brand synergies, Topgolf Callaway earlier this month began a program by which each all Topgolf players will have the opportunities to upgrade to Callaway branded premium clubs at each Topgolf venue.
“By mid-year, this will include clubs specifically designed by Callaway for use in bay by both established golfers and those new to the game,’’ Brewer said. “In the near future, we will be able to upsell this program via the app and in reservations.”
All Topgolf golf professionals, according to Brewer, are on Callaway’s golf staff and can exclusively sell Callaway golf equipment to their students. Callaway will host organized club fitting events at all venues beginning this spring, and will also be the official equipment sponsor of Topgolf’s league nights.
In addition, Brewer said, the company’s respective marketing teams “are leaning into’’ the Callaway Chrome Tour Golf Ball launch to promote sales and trial of our new golf ball.
“Our goal is 200,000 new users coming specifically from Topgolf.”
The company also plans to show various Callaway branded limited edition golf balls in venues throughout the year.
“We have an exciting Callaway and Topgolf golf club program that will run across all venues, and TravisMathew (apparel) will increase its presence in approximately one-third of the venues where the price point works effectively,’’ Brewer said. “And later in the year, we’ll be implementing a new Callaway digital kiosk in the lobby of all venues – a piece that we hope will amaze and delight all the new and existing golfers that visit the venues during the year.’’
Toward the end of 2023 – or early ‘24 – the company will introduce specific Callaway-branded golf equipment designed for the beginner golfers being introduced to the sport via Topgolf.
“We will then leverage the consumer data platform and our digital teams to market this product to these new players, thus creating a competitive advantage and reach to what should be the largest single source of new golfers in the modern golf ecosystem.’’ Brewer said. “We expect over 30 million unique players will walk into Topgolf venues in 2024, with a strong in venue Callaway brand presence, the ability to trial Callaway premium equipment in our bays, and an advantage in digital reach, as well. We’re excited about brand Callaway being front and center with this next-generation of modern golfers. At the same time, Callaway and TravisMathew will be working to drive awareness and visits to Topgolf.’’
Topgolf Callaway currently owns and operates 94 Topgolf venues. It has five Topgolf franchise locations and three BigShots franchisee locations. Callaway Golf acquired Topgolf in March 2021 for approximately $2 billion.
“We expect to add another seven new Topgolf venues this year, two in the first half, and five in the second half, for a total of eight new venues in 2024,’’ Brewer said. “We also expect to help open two international franchisee locations.’’
In Q4 of 2023,Topgolf’s revenue increased $29.5 million ( 7.2%) to $439.0 million compared to Q4 of 2022. Topgolf finished 2023 the the company’s leading operating segment in terms of revenue – $1.76 billion – an increase of nearly 14 percent versus ‘22.