Union Tribune On Callaway

Jennifer Davies and Shannon McMahon in the San Diego Union Tribune look at new Callaway CEO George Fellows and the task before him.

But it's not just waning participation that's squeezing golf equipment companies like Callaway. Improved club technology, which helps players hit balls farther, doesn't drive sales the way it once did. Callaway, a technological innovator, thought it could set itself apart by continually offering new and better clubs and balls while charging premium prices.

The United States Golf Association, however, has strict restrictions on what equipment players may use in order to qualify for a handicap. And Callaway has been stung by those rules: The USGA essentially banned the company's ERC driver when it came out in 2000.

They introduced a product knowing it was illegal in North America, marketed it as non-conforming around the world, but it was "essentially banned?"  Hmmm...

While Drapeau, the company's former CEO, often complained about the USGA rules, saying "it was the biggest challenge" facing Callaway, Fellows has a different take.

"They are parameters. They are not a jail," he said of the USGA rules. "Let's find a way to be smarter than the next guy within those limits."

Give Fellows a few quarters of lackluster sales, and we'll check back to see how forgiving he is.

Meanwhile, we must not forget that life and commerce are only about one thing, and one thing only. No matter what you're selling or useless the widgets may be, it's all about...the brand.

With specialty consumer products like cosmetics and golf equipment, which are susceptible to trends, creating and marketing a strong brand is especially important, said Alexander Paris Sr., analyst with Barrington Research. Fellows' experience at Revlon and other consumer-oriented companies like Playtex and Mennen made him an especially strong candidate.

"This is a time that you want to get someone who knows how to sell branded products," Paris said.