Nike, the most lucrative sports brand in the world, is stepping out of the golf equipment business.
A company press release indicated that Nike will transition out of equipment including clubs, balls, and bags to focus on footwear and apparel.
Nike was committed to being the undisputed leader in golf footwear and apparel, but annual sales over the last two years have been flat to down. Nike has been in the golf business since 1984, but only introduced its first clubs after bringing in Tom Stites and his independent club design team at Impact Golf in 2000. Its first efforts came in 2001 with the Nike Forged Blades irons and then they were followed in 2002 with Pro Combo irons, which uniquely combined three different kinds of irons within the same set. Its sales in 2013 and 2014 were nearly $800 million.
They announced that their 2016 line of clubs was extraordinarily reduced in price. That included $400 Vapor Fly drivers reduced to $150, and $250 Vapor Fly fairway woods to $100.
The company has struggled to become a leading player in the equipment business, with market shares in woods and irons that were routinely one tenth those of leaders like Callaway and TaylorMade.
The company was known for non-traditional equipment designs over the years, including the cavity back Slingshot irons, square drivers named Sumo that reached the USGA’s limit for moment of inertia, and golf balls called Mojo that were marketed in a psychedelic box. The company had groundbreaking equipment technology, including sole channels and cavities in its metal woods, clubs with shorter shafts, but larger heads, and golf balls that utilized a lightweight, ultra resilient polymer resin material in their cores called RZN, while the majority of the industry’s golf balls feature cores made exclusively of polybutadiene rubber.
There is no indication what will happen to Nike’s present tour staff, which in addition to Tiger Woods, includes world No. 4 Rory McIlroy, and 14 new players signed this year. That roster includes big hitting burgeoning stars Brooks Koepka and Tony Finau.