It is interesting to see more companies begin to use programs aimed at locking in customers through the same kind of pull-ahead lease offerings made famous by car companies. If you're not familiar with the concept, a pull-ahead program is a lease program that allows the customer to terminate their lease earlier and fast-track themselves into a newer model at lower or similar lease payments, without incurring early termination fees. It's a way to "pull" customers back into the buying cycle ahead of when they would normally begin the process.
TaylorMade Golf is launching a, their program, called "The Turn" enables customers to gain access to the newest and most advanced equipment every season. With this upgrade program, you'll play with your TaylorMade clubs for 12 or 24 months, and then upgrade it to the newest model.
"The Turn" enables a golfer to:
- Easily stay in latest club product technology
- Ability to play a new driver every 12 months
- Ability to play a new set of irons every 24 months
- Just return the old club in exchange for a new one of the latest model
An 18 or 30 month financing options at 9.99% APR underpins the program. This provides the buyer the ability to avoid upfront payment of hundreds of dollars each time they buy a club and to stretch their payments out at a lower interest rate than most credit cards currently offer (e.g., For $25 - $30 per month, you could play a new $400 - $450 driver every year). TaylorMade likes the idea because it provides the potential to lock-in a customer for life and, with some luck, that same customer can be upsold into other clubs (I .e., drivers, complete iron sets and fairway woods are currently offered in the Upgrade Program) in the future.
Companies within the ultra-competitive golf equipment industry, like TaylorMade, rely on customer loyalty to maintain their revenue base. A lease pull-ahead program, like "The Turn," offers a way to retain customers who may otherwise experiment with other manufacturer's offerings, if they were not otherwise "committed" to stay within the TaylorMade family of offerings.
Does It Make Sense For the Golf Equipment Customer?
Of course, the answer to the question of whether this type of program makes sense to the golf equipment customer lies within each customer's particular situation. Some considerations include:
- Do I want to lease or own my golf equipment?
- Do I believe that TaylorMade will always be introducing products with the baked-in technologies that I'm looking for in a golf club?
- Am I willing to pay a premium, in the form of interest, to have new stuff in my golf bag every year?
- How much do I want to spend annually on golf?
To close, while promising, the jury is still out on whether pull-ahead lease programs like "The Turn" will take hold in the golf equipment industry. TaylorMade's foray into the space may prove to be the model that their competitors will need to follow in order to maintain and grow their businesses. It could also turn out to be an experiment that just didn't pan out.
Please reach-out to me to explore how your company may benefit by exploiting innovative sales solutions like pull-ahead leasing. It's something we can help you with, for sure.