The Internationalization of the PGA Tour

Description

The Internationalization of the PGA Tour: Abstract

The Internationalization of the PGA Tour is a case study by David Pastoriza Rivas and Patrick Coulombe.

This case describes the internationalization of the PGA Tour, the U.S.’s professional golf circuit. Propelled in part by the popularity of golf in its domestic market, the PGA Tour built a successful business model attracting the best international players and global corporate sponsors. While the popularity of golf is showing no signs of waning in the U.S., it has been growing fast in other parts of the world. Now attempting to capitalize on opportunities abroad, the PGA Tour faces two challenges: some components of its business model do not lend themselves to internationalization, and its strongest rival, the European Tour, got a head start on the international scene in the early 1990s by gaining a foothold in many important markets.

This is a decision-making case. It describes recent events (1996–2017) surrounding the internationalization of the PGA Tour and the competitive rivalry between the PGA Tour and its main challenger, the European Tour. Students are asked to put themselves in the position of Jay Monahan, the newly appointed PGA Tour commissioner, and assess whether the international strategy of the PGA Tour will give it a competitive advantage, particularly since the European Tour is challenging the PGA Tour’s dominant position.

Teaching objectives

This case aims to help students to do the following:

• Identify the key factors that prevent a business model from being internationalized and of a strategy that could help address that challenge.
• Learn how to deal with multimarket competition. When competitors are simultaneously present in several countries, their competitive responses are more complex.

Main themes covered

• The difficulties of internationalizing some components of a business model
• How multimarket contact (the simultaneous presence of two competitors in numerous markets) drives competitive tension
• How head office decisions can have a lasting impact on foreign subsidiaries

Concepts & theories related to the case

• Multimarket competition

Additional information

Teaching notes are available for teachers only. Please contact the HEC Montréal Case Centre.