UK Golf Retail: Half a Year Gone!

Phil Barnard golf retail market update

Phil Barnard's Half-Year Market Update

Can you believe the season for golf majors is already over, and we're only just half way through the year? It's hard to think that the big events are finished for 2019. Will this allow some of the smaller tournaments to grab the limelight? The organisers hope so.  Time will tell, but I did enjoy this year's offerings, which were finished off with a great win for Shane Lowry at The Open Championship.

Now, let's turn our attention to the events in the world of UK Golf Retail this year.

 

 

2019: The Story, So Far

After a pretty bonkers start to the year, (up nearly 9% on March 2018, and 23% on 2015), things took a turn for the worse, with May and June down on sales, compared to 2018. According to Golf Datatech's retail audit, the first 6 month's Value change across the core categories were:

  • January up 4%,
  • February up 10%
  • March up 10%
  • April up 2%
  • May down 2%
  • June down 5%

At the end of June this year, sales were up about 2%, overall, Year to Date. This was up 21% on 2015, and almost 4% on 2017: clearly a market heading in the right direction. Let's not forget that May last year was the biggest month, for sales, ever recorded in the UK. Hoping to beat that in 2019, would have been a pretty tall order. However, with momentum building, it was disappointing to be down this June, and most of which, we can put down to terrible weather.

Most categories had a torrid June, with the exception of Outerwear, Tops and, oddly Distance Devices. Perhaps they are making new waterproof ones!

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Outerwear was up, over 110% on the previous year: making up ground following a really poor few months. However, it is still the worst performing category of 2019.

The overall picture of sales this year has been quite similar to other years, with Woods and Irons the biggest categories. The gap is much closer than it was a few years ago, with Woods being the biggest category, (just), at the moment.

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Looking at June, in isolation, we can really see what a bad month it was.

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Perhaps not surprisingly, the Outerwear category enjoyed over 115% growth, compared to 2018, while all major categories were down. In June, rainfall was 152% of the annual average for the month. Notably, Ball units were down 26.9%: a clear indicator that attendance on courses was significantly down.

Year to Date, the picture is very different, with 10 categories showing growth and 7 showing decline. Distance devices are currently enjoying a lead position, while Outerwear sits at the bottom of the class.

 

Concerning Categories

Looking at some of the long-term trends, one category of concern, for me, is Shoes. This year, the category is down 4%, Year to Date. However, on a rolling 12 months, this decline is now at 10%. It is a marked change in behaviour. We have seen continual value growth in this category for over 5 years. However, this changed towards the end of 2018 and the numbers have been dropping ever since. The reason seems to be a market shift, with consumers turning their backs on spiked shoes: down over 25% on a 12-month basis. It seems that consumers are choosing spikeless, over spiked shoes.

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We will, of course, be tracking this trend to monitor any changes.

Overall, most of the categories are behaving as expected. That said, Woods continues to lose unit sales, year on year. Whilst the Woods category behaved relatively consistently until 2015, with predictable growth and deflation cycles, the flow of units changed when the large price rises kicked in. While shot tracking and custom fitting might have been the real drivers for change, units have been dropping since 2013 at between 5 and 10%. At some point, this will have to bottom-out, but that isn't in sight yet.

 

Changes in price and units

Like taxes, prices keep rising. And not one category has seen a decrease, year to date. With 5 categories seeing double digit growth in Average Sale Price (ASP).

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Predictably, this has had an effect on units. Only 5 categories have shown any unit growth and, rather predictably, the worst was Outerwear.

 

Future Predictions?

Thankfully, the July numbers looked good, and beating 2018 should be no problem. It was a very poor month last year, thanks to the World Cup and the intense Summer heat. Whilst we had the hottest day on record this month, the average temperature wasn't extreme, and I expect to see some positive figures come through.

The rest of the year is in the balance. We still have half left, so the big picture could have a few twists and turns yet. As we saw in June, rain can cause havoc for our industry. To put things in context, last June had the least rain days on record since 1961. By contrast, June this year was the 11th wettest (pretty close to being the 7th).  The only blessing is that we weren't counting sales in 1991 - it rained for 18 days! Let’s hope we enjoy a drier August and September, or may end up seeing the total numbers slip back.

I am still expecting some growth this year. Golfers are playing and recent participation numbers are positive. There's also a lot of good product out there, and more expected. Reported rounds played is up, so good numbers of people are back in the habit of playing the sport. Let’s hope they carry on spending!

 

Get in Touch

As always, I'm happy to help and answer any questions you might have on the market data, so do send any thoughts, or queries, across to me.

Phil Barnard is Chairman of Crossover Technologies and European Partner of Golf Datatech. Contact Phil at pbarnard@golfdatatech.com

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