Digging Out of the Hole

Inventive approaches to promoting what’s great about golf show real promise, even as rounds remain relatively flat.

by C&RB Staff (editor@clubandresortbusiness.com)
December 2006
 

With their own average store sizes growing toward the larger ranges, thanks to the clubhouse renovation boom, on-course retailers may have less to fear from the largest “big box” stores that represent less than a quarter of the off-course competition.

STAT BOX 38 cents more merchandise revenue per round came from sales at private clubs than from resorts in 2005 Source: PGA RESEARCH 4k median gross concession income in 2005 for head golf pros who don’t own concession median gross concession income in 2005 for head golf pros who do own concession Source: 2006 PGA COMPENSATION STUDY 24k

Going by the monthly rounds-played reports issued by the National Golf Foundation (see pg. 7), “pure golf” activity at clubs and resorts is still on a lower-level plateau, compared to the glory days of the late 1990s. Reports from individual areas of the country also reflect a mixed bag. For every upbeat report that came out this year (“Local Golf Industry on Upswing,” Houston Chronicle, June 28), there were also reminders that there’s still a lot of work to be done (“Golf Courses Being Plowed Under in Record Numbers,” USA Today, September 1)—and that being able to survive on golf alone may never again be possible.

Beneath the blasé numbers, though, lies a renewed spirit of excitement and determination to find new ways to get more people charged up about the game. Golf professionals at many properties have shifted from a fixation on getting rounds back to the record levels of the ’90s, to instead focus on finding ways to leverage the rounds that are played as better foundations for a richer overall club or resort experience (which also delivers richer revenues, when greens and cart rental fees are combined with more sales for meetings, merchandise, F&B, etc.)

Be it at a storied club like Pinehurst that never has to worry about attracting players (see case study, pg. 51), or new properties trying to put themselves on the map, management teams are working harder to find innovative ways to get golf “off the island” and integrate its appeal with the rest of what clubs and resorts have to offer. Here’s a roundup that includes some noteworthy examples that surfaced this year to reflect this trend:

Good News That Al Gore Forgot to Mention
A lengthy academic tome published in the Journal of Leisure Research on “The Impact of Climate Change on Golf Participation” projected that if global warming trends continue, the average golf season could be one to seven weeks longer as early as the 2020 decade. “With much improved shoulder seasons, average rounds played could increase from 5.5 percent [for the most mild warming scenario] to 37.1 percent,” said professors from the Department of Geography at the University of Waterloo (Ont).

Children in Their Place
The golf course upgrade at the Sandestin Golf and Beach Resort’s Baytowne Golf Club included the creation of an additional set of tee boxes for children under 12, to give the course more of a “family touch.” And Inverness Country Club in Birmingham, Ala., which says it is the first course in its area to offer “Junior tees” designed specifically for young golfers, has also waived cart fees for any golfers under 16.

Feeling More at Home at The Range
Time magazine’s article on the new TopGolf “golf game center” in Alexandria, Va., reported that the range was on pace to have more than 135,000 customer visits during its first year, and projected to break even within four years. The facility—the fifth of its kind in the world and first in the U.S.—“turns swing practice into a competitive activity” by having players aim at dartboard-like targets and use balls with microchip sensors to earn points, depending on length and accuracy.

To create a “clubhouse” feel at the facility, flat-panel displays are installed in heated driving bays tended by “caddies” serving food and beverages. Pros are on hand for instruction, and miniature golf courses are available for younger players.

The Alexandria range, which cost nearly $7 million to construct, has been successful in attracting “leisure customers” who see it as less intimidating than other range alternatives, Time reported. This segment accounts for half the clientele, with “recreational duffers” and “hard-core golfers” each accounting for another 25 percent. The center has also had good success attracting kids’ birthday groups, companies looking for team-building activities, and groups of 20 or more looking for new ways to drink and play (F&B accounts for about 20 percent of total sales). Two new TopGolf facilities, in Chicago and Dallas, are scheduled to be rolled out in 2007.

A Mulligan and A Massage
Many major resorts now have golf coordinators to serve as the go-betweens for on-staff golf directors and meeting planners, according to a report in Business Meetings magazine. The planner provides a wish list for the group that’s coming to the resort, and the coordinator designs a specific program to help that group get the most out of the property’s services and amenities. This has led to such special activities as nighttime putting contests and on-course spa treatments.

Wired Up = Fired Up?
Concerns over the long-term outlook for gas prices has some properties taking another look at the cost-effectiveness of electric golf cars. That, in turn, could lead them down a much more costly path if they don’t make sure their properties are equipped to handle the related maintenance implications. A recent study by St. Paul Travelers of over 20,000 general liability and property losses that occurred at more than 1,400 golf courses between 1987 and 2004 found that while fires accounted for just four percent of the total number of claims filed, they led to 40 percent of total claim costs, based on the amount of damage. The most common cause of the fires were overloaded circuits from recharging electric cars.