1. sports
2. golf

Programming for Profit or
how to avoid the death spiral of discounting
The State of the Game Golf Summit
Olympia Fields Country Club
April 2007
It is clear golf is good for business!
Double the number of visitors $$$
Double the length of stay $$$
Equal or greater $$$ spent per day
Adds value to sale $$$
$62 Billion Economic Impact in United States
A clear winner to the bottom line $$$ and for golfers
Tipping Point
Little Things Can Make a
Big Difference
You influence public
opinion
Be Passionate
Be obsessed
Have perseverance
Be persistent
Smile ☺ and have Fun!!!
Why
Why is
is the
the NGCOA
NGCOA involved
involved with
with education
education
on
on this
this topic?
topic?
ItIt is
is fundamental
fundamental to
to our
our mission
mission
“To
“To enhance
enhance the
the lives
lives of
of golf
golf course
course
owners
owners by
by making
making their
their businesses
businesses more
more
profitable,
profitable, more
more efficient,
efficient, better
better managed
managed
and
and more
more stable.”
stable.”
Attracting and retaining revenue is the
number one issue with course owners and
operators
Evangelize best practices . . .
Avoid bad apples and pitfalls
of other industries
Strategically we are fostering and
supporting working together
with allied associations, CVB’s, tourism
partners, gov’t, and suppliers at the
international, national, and local level
•to grow the game
•enhance the brand of golf
•make it more stable.
.....at the international, national, and local
level
www.golf2020.com
www.eifg.org
The Goal
Goals
•Attract and retain raving fans that fill
tee sheet year- round at the highest
possible rate while maximizing yield per
round through retail, food and
beverage, instruction, and other
revenue.
•Develop a waiting list for members
with initiation fees paid in full and all
members paying the highest level of
dues
•Tournaments and leagues sold out
Goals
•Energize customers to be your most
effective marketers . . . the best
source of referral
•Provided a clean, green and pristine
environment for golf, relaxation and
renewal
•Be financially able to give back to the
community via charity, human and
financial resources
Customer Segmentation
1. Brand-loyal customers - Experience
• course or destination direct
2. Brand-agnostic customers - Experience
• any similar course in the same type and price point
3. Brand-disloyal customers – Price driven
• Priceline, Last minute golf
UNDERSTANDING
COMMODITIZATION
High
DIFFERENTIATION
experience
service
product
commodity
Low
PRICE
Programming Over Price
High
Player Types to Manage
•
•
•
•
•
•
•
•
•
•
•
•
Club Members
Resort Market
Tourist Market
Group & Convention
Travel Provider
Local Resident
Local/Regional market
Affinity Markets
(AAA, ATP, VISA)
DVC/T-VO Market
Local Corporate
Hospitality Market
Membership Cards
• NGCOA, CMAA, PGA, GCSSA
Members
• Military Personnel
• Company Executives
• Staff Members
• Corporate Alliances
• Junior Events
• Bargain Market
• Last Minute Market
• Site visits & Comps
• Charity/Community
• PLUS Many Others...
Step 4: Sort Rounds Categories into
Price/Discount “Buckets”
1: No Discount
Rack Rate Rounds, Full
Paid Packages, Company
Executives
2: 5-10% Off
Small Discounts to local
hotels & concierges, AAA
Members, other affinities
3: 15-25% Off
Medium Discounts to
Loyalty groups, Annual
Passholders, & Members
4: 30-40% Off
5: 50-100% Off
Deeper Discounts, Seniors,
and rounds with large
Commission payouts
Super Discounts to PGA,
Employee groups, Junior
Golf, Comped rounds
Step 4: Buckets can be turned on or off
1: No Discount
Rack Rate Rounds, Full
Paid Packages, Company
Executives
2: 5-10% Off
Small Discounts to local
hotels & concierges, AAA
Members, other affinities
3: 15-25% Off
4: 30-40% Off
5: 50-100% Off
Medium Discounts to
Loyalty groups, Annual
Passholders, & Members
Deeper Discounts, Seniors,
and rounds with large
Commission payouts
Super Discounts to PGA,
Employee groups, Junior
Golf, Comped rounds
Begin Behind the Scenes
• What is the Artificial Intelligence in the back end of your
management information system.
• What are your various player types and rates.
• What are your rate seasons, date ranges, and time ranges.
• What are your tee times, booking windows, affiliated hotels
and sales channels, and tee intervals on each course.
• What are your various player types and rates and your Profit
Management “Buckets”.
• Training . . . Especially how to handle the price call
Important trends that affect golf
. . . what golf courses are doing to stay relevant
Emerging Lifestyles
Demography
Technology
Leisure Time Vacation time
From 2006 National Travel Monitor
Yesowich, Pepperdine, Brown, Russell,
Yankelovich www.ypbr.com
Breaking News
• Consumers want to reconnect
with what they feel is really
important in their lives
• 73% now spend more time
thinking about what works in
their lives and what doesn’t
From
From 2006
2006 National
National Travel
Travel Monitor
Monitor
Yesowich,
Yesowich, Pepperdine,
Pepperdine, Brown,
Brown, Russell,
Russell, Yankelovich
Yankelovich
www.ypbr.com
www.ypbr.com
Building Firewalls
A Renewed Interest In Family
• 71% of parents wish their family spent more time
together as a group
• 69% wish they had more time to just sit and talk
with their kids
From 2006 National Travel
Monitor
Yesowich, Pepperdine,
Brown, Russell, Yankelovich
www.ypbr.com
Time Poverty
Agree: I feel like I don’t
have enough time.
%
41
From 2006 National Travel
Monitor
Yesowich, Pepperdine,
Brown, Russell, Yankelovich
www ypbr com
Seeking Relief
Agree: I need to find new ways
to reduce stress in my life.
76 %
From 2006 National
Travel Monitor
Yesowich, Pepperdine,
Brown, Russell,
Yankelovich
www.ypbr.com
Trend Watch
There are now twice as many people interested in
visiting a spa on vacation than interested in playing
golf.
From 2006 National
Travel Monitor
Yesowich, Pepperdine,
Brown, Russell,
Yankelovich
www.ypbr.com
“spas are the amenity of the future for
private clubs: Yoga, fitness on the range –
private clubs have been reinventing
themselves”
Jim Singerling the ceo of the CMAA
Agree:
I would experience difficulty
if my paycheck were delayed
for one week.
74%
Source: American Payroll Association, 2006.
Demographics
Better Educated
24% of U.S. adults now have a bachelors
degree or more (compared to 20% in 1990)
58% of the class of 2008 will be female
From 2006 National
Travel Monitor
Yesowich, Pepperdine,
Brown, Russell,
Yankelovich
www.ypbr.com
More Affluent
Affluent Household As %
Of Total U.S. Households
25.90%
14.00%
11.30%
4.60%
HHI
HHI >$100K
>$100K
2000
2010
HHI
HHI >$150K
>$150K
From 2006 National Travel
Monitor
Yesowich, Pepperdine,
Brown, Russell, Yankelovich
www.ypbr.com
Trend Watch
There are now more millionaires in America
than there are people who are unemployed.
From 2006 National
Travel Monitor
Yesowich, Pepperdine,
Brown, Russell,
Yankelovich
www.ypbr.com
Women
Rising number of affluent women 51% of buying
power in America Martha Barletta
40% of active business travelers
community
dining variety
spa/fitness
clean facilities/bathrooms
wireless
safety
Golf For Women Magazine
Multi-Cultural
Nearly one in five Americans (47,000,000) do not
speak English at home
More than half of them (28,000,000) speak Spanish
– 62% increase in last decade
–Demographic shifts the traditional core and
avid golf participant the middle aged white
male is already in the minority or on the way
to minority status in America.
–The Green Magazine
More Diverse
Racial Group
White
Hispanic
African American
Asian
Other
Source:
Source: U.S.
U.S. Census
Census Bureau,
Bureau, 2004
2004
2000
2050
69%
13
13
4
1
50%
24 
15
8
3
Over 65
In America
• 12% (36MM) in 2003
• 20% (72MM) in 2030
From 2006 National Travel
Monitor
Yesowich, Pepperdine, Brown,
Russell, Yankelovich
www.ypbr.com
79MM Boomers Start
Turning 60 This Year
From 2006 National Travel
Monitor
Yesowich, Pepperdine,
Brown, Russell, Yankelovich
www.ypbr.com
“Millennials”
• Born between 1980/2000
• Outnumber Boomers and GenXers by 2010
From 2006 National Travel
Monitor
Yesowich, Pepperdine,
Brown, Russell, Yankelovich
www.ypbr.com
The Power Of One
Single person households
outnumber married households
with kids.
SINGLE, NO
KIDS
MARRIED,
WITH KIDS
31.10%
31.60%
31.30%
31.20%
31.30%
31.40%
31.50%
31.60%
Source:
Source: U.S.
U.S. Census
Census Bureau,
Bureau, 2005.
2005.
Technology
Demystifying Distribution Sue Heilbronner & Cindy Estes Green
HSMAI Hospitality Sales & Marketing Association
International www.hsmai.org
Profits and Pitfalls of Online Marketing: A Legal Desk Reference
for Travel Executives Mike Heilbronner, Sue Heilbronner &
Cindy Estes Green
www.TIGglobal.com
Email has increased average
length of work day by one hour.
From 2006 National
Travel Monitor
Yesowich, Pepperdine,
Brown, Russell,
Yankelovich
www.ypbr.com
Internet Usage
• Average of 24 minutes daily
sending/receiving email messages
• Average of 4 minutes daily for search
Source: Pew Internet and American Life Project, 2005.
Get wired or get fired
•In 2004 household use of the Intranet exceeded the use of ANY
other medium- including television, radio, newspapers, and
magazines ( US Online Marketing Forecast 2005-2010 Forrester
May 2005
•Pew Internet Life Survey, 2005 89% of college educated people
use the internet. In homes with combined household income
above $75,000 95% of men and 90% of women use the internet
71% have broadband
Get wired or get fired
•Internet Use among the educated, middle/upper class is near
full penetration
•79 million Americans (78% of US travelers) turned to the
Internet in 2005 for travel and destination information,
compared to only 65% in 2004 (Travel Industry Association)
•50% of all hotel bookings expected to be online by 2009
Consumers are Booking Hotels
Online
Online
Online hotel
hotel bookings
bookings will
will be:
be:
36%
36% of
of all
all leisure
leisure bookings
bookings by
by 2007
2007
50%
50% of
of all
all leisure
leisure and
and unmanaged
unmanaged
business
business bookings
bookings by
by 2007
2007
Source: Phocus Wright 2005 Travel Edition,
Forrester US Online Marketing Forecast 2005
Leisure Consumers are
Researching and Booking
Travel Online
Online Leisure Booked Revenue
$110.5B
$120
Amtrak
$100
$63.5B
Cruises
Billions
$80
Vacation
Packages/Tours
$60
Rental Cars
$40
Lodging
$20
$0
2003
Airline Tickets
2004
Source: Forrester US Online Marketing Forecast 2005
2005
2006
2007
2008
2009
Consumers Prefer Booking
Direct
– Consumers research with TPIs but increasingly book direct
– Jupiter Research shows a decreasing share of hotel booking
through online agencies and increasing share through online
direct
Expedia
Travelocity
Orbitz
Hotels.com
Cheap Tickets
Priceline.com
0%
10%
20%
Research
30%
40%
50%
60%
Book
Sources: Jupiter Research Internet Travel Model July 2005 (44% direct in 2006, 47% in 2010); Forrester’s Consumer Technographics® 2005 North American
Benchmark Mail Study; “Travel Retail Smackdown,”
Google is King
How
How People
People Search
Search for
for Golf:
Golf:
Keyword
Ann Searches
Golf
29,227,176
Golf Course
10,819,656
Golf Club
5,049,612
Golf Vacation
1,427,868
Discount Golf
1,072,188
Las Vegas Golf
745,056
Golf Gift
723,168
Golf Lesson
598,284
Golf Resort
520,092
Golf Course Chicago
476,388
Myrtle Beach Golf
367,452
Golf Ireland Vacation
340,164
Golf Course Detroit
338,580
Arizona Golf
321,768
Golf Course Philadelphia
273,924
Golf Package
201,240
Beach Golf Myrtle Beach
143,568
Florida Golf Vacation
53,784
Arizona Golf Vacation
45,576
*Source: ComScore March 2006; Overture May 2006 search volume. Multiple of 3 over Overture is
assumption of total.
Current Landscape
Givens in Today’s Marketplace
• Customers want it all; bankable quality at bargain
prices. But if that were the end of the story, we
would all be using generic toothpaste.
• Segmentation and relationships are the keys to the
future. Businesses that focus on creating bonds with
the most potentially profitable customers who share
the same values will be more successful.
• The businesses that move ahead are those that can
recognize profitable customers, have the capability
to obtain critical knowledge regarding preferences,
and can parlay that knowledge into experiential
differences at all critical touch points.
Future of Travel Distribution
“Travel distribution will have to evolve from efficiently
processing transactions to carrying out meaningful
conversations with customers that are rich in content,
address their service issues and concerns, and finally,
efficiently process the customers transactions. The goal will
be to carry out ongoing conversations with targeted
customers that produce profitable bookings.”
- "Customer-Centric Systems for the Travel and Tourism Industry, " report,
Accenture/World Travel and Tourism Council (WTTC), May 2002
Reported in eMarketer, October 2003
Leisure Time/Vacation Habits
Enjoyment
Expect To Do More Of This Year
Take a special vacation
Lose weight
Look for ways to organize myself
Have more fun
Buy new furniture
Send more letters and greeting cards
Look for a new job
Read the newspaper more
Buy new appliance
Buy computer software
From 2006 National Travel Monitor
Yesowich, Pepperdine, Brown, Russell, Yankelovich www.ypbr.com
55%
54
47
47
27
26
21
21
19
15
Enjoyment
Most Likely To Do In My Spare Time
Spend time with friends and family
Read
Watch television
Call friends and family
Take a walk
Cook something special
Go to movies
Work in the yard
Go for a drive
Have sex/make love
From 2006 National Travel Monitor
Yesowich, Pepperdine, Brown, Russell, Yankelovich www.ypbr.com
79%
70
63
58
58
55
54
51
48
47
No PE in Schools
Frank DeFord the acclaimed veteran sports writer
opined that golf is not unlike other sports, i.e.,
kids are introduced by their parents . . . quote
decline of parental involvement
Vacation Deprivation
Agree: I feel like I don’t have
enough vacation time.
47%
From 2006 National Travel Monitor
Yesowich, Pepperdine, Brown, Russell, Yankelovich www.ypbr.com
Length Of Vacations
(2006)
Extended (5+)
23% 
Weekday (<4)
24%
Weekends (<4, Saturday stay)
53%
Length Of Vacations
(2006)
Extended (5+)
23% 
Weekday (<4)
24%
Weekends (<4, Saturday stay)
53%
From 2006 National Travel Monitor
Yesowich, Pepperdine, Brown, Russell, Yankelovich www.ypbr.com
Interested In Playing
Golf On Vacation
(All Leisure Travelers)
16%
14%
12%
10%
8%
6%
4%
2%
0%
17%
2006
From 2006 National Travel Monitor
Yesowich, Pepperdine, Brown, Russell, Yankelovich www.ypbr.com
Desirable Vacation Attributes
(Leisure Travelers Annual HHI >$150K)
85%
DINING IN NEW RESTAURANTS
63%
SHOPPING
43%
VISITING SPA
33%
PLAYING GOLF
31%
GAMBLING
PLAYING TENNIS
13%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90%
From 2006 National Travel Monitor
Yesowich, Pepperdine, Brown, Russell, Yankelovich www.ypbr.com
Resort Real Estate
(Affluent Travelers)
Currently Interested
Type
Own
In
Vacation Home/Condo 20%
10%
Timeshare
18
4
Vacation Ownership
9
5
Private Residence Club
5
4
Fractional Ownership
6
1
From 2006 National Travel Monitor
Yesowich, Pepperdine, Brown, Russell, Yankelovich www.ypbr.com
New Fitness Activities are growing and dominating
“traditional activities”
Fitness activities
• Pilates, Yoga, Taebo, Spinning,
Aerobics, etc
• Cycling, Weights, Dumbbells,
Ellipticals, Treadmills, Rowing,
etc.
• Fitness Walking, Running,
Fitness Cycling, etc.
Baseball, Basketball, Golf, Football,
Soccer, Skiing, Volleyball, etc.
Frequent Participants
1998
2005
Change
51.3m
58.1m + 13%
Many of these did not exist 15
+ years ago
42 million health club
memberships
All are down during the same
period (28 million total
frequent participants)
The Only
Traditional Sport
to Grow in
the past 5 Yrs!
Tennis +10.3%
Football (.6%)
Swimming (2.8%)
Bicycling (3.0%)
2006 SGMA SuperStudy
2000-2005 % change
What else
is
growing?
Soccer (4.1%)
Racquetball (4.8%)
Fishing (5.4%)
Baseball (6.4%)
Ice Hockey (8.6%)
Volleyball (10.6%)
Basketball (14.9%)
Golf (15.3%)
Skiing (Downhill) (18.3%)
Softball (23.0%)
-30%
-20%
-10%
0%
10%
20%
“America
Gets Fit”
June 6,
2005
% of Americans who do these things each week…
69%
35%
32%
30%
21%
18%
take a brisk walk
use exercise machines
lift weights
do aerobic exercise
swim
play any sport
Notice the ‘exercise’ or ‘aerobic exercise’ categories %’s are 2 to 1
over ‘play any sport’
Travelers are looking for natural beauty
...
www.eifg.org
LRA Worldwide
Conducted research on 125,000 about
drivers of customer satisfaction
6 of 10 were emotional and service related,
e.g.,
“How was I welcomed?” “How friendly was
the starter”
What’s your member’s or guests favorite service that you offer?
“I think the most important thing will be to train all of your
staff (yourself included, if appropriate) so that they are
incredibly friendly and service-oriented and that they learn the
member's names. Have the staff wear name tags.
A smile and welcome them by name.”
“Putting smiles on the Customer's face is the most important
beyond physical offerings. Welcoming them with open arms
and thanking them for favoring your club. Everytime all the
time!”
“our most appreciated service is the unmitigated friendliness,
positive attitude and knowledge that our staff shares with
them”
“Acknowledgement and communication”
Start and end with human
experiences . .
A smile, a welcome by
name, a fond farewell,
followed by ongoing
personalized contact,
programming, and services
Also, “The Big Moo, Stop Trying to be
Perfect and Start Being Remarkable”
www.behospitable.com
Malcolm Gladwell Blink
First impressions now in a blink of an eye
7 seconds . . .
Marketing Insights: Practical Applications
1.We are in the business of building
long lasting relationships with each
customer based on trust,
memorable experiences, and
community
Steps to Building a raving fan/customer base
1. Have your core/avid loyal golfers bring back
former golfers and new golfers
2. Pursue non-playing spectators
3. Increase participation from women
4. Growth of junior golf
5. Families, families, families . . .
6. Increase your diversity/people of color
7. Disabled golfers
Three elements of any successful programming
Orientation and Trial
Instruction and Learning
Programming and Continued Experiences
Promoting the golf industry calendar of events
•Take Your Daughter to the Course Week
• Take Your Kid to Play Golf
• Women’s Golf Week
• Marketing Materials
• Family Friendly Golf Set-up Family Golf Month
•Disabled Golfers
•Beginner Friendly Course Certification
•Kids on Course
•Disabled Golfers
•Corporate Leagues, Outings, Tournaments
Play Golf America
www.playgolfamerica.com
Implementing golf industry best
practices
• Destination Marketing
• Best Practices in working with third parties
• National Alliance for Accessible Golf
•Tournaments
• Leagues Executive Women’s Golf Association
• Couples, e.g., wine and nine
• Teenagers, e.g., Hook a Kid on Golf, Get
a Grip Fd.
Programs that are working
•Family focus Some TPC courses have been successful in including day
care
•Wine and nine for couples
•Kids Play Free (MB)
•Music and golf for teens in the afternoon after school
A couple of courses have recreated the 1950’s drive in movie with an
inflatable screen on the driving range with golf cars replacing cars and
food and beverage served to their cars.
The Clubs of Kingwood in Houston
Four seater cars for women, private water park, $5 million dollar
fitness center with day care, Family Fun membership, Young Executive
Membership . . . less than a year up 500 percent. Beginner clinics for
adults followed by cocktails or a progressive dinner served on each
tee.
Programs that are working
Private Clubs
John Beckert, ceo of ClubCorp in the 19th Hole of Oct issue of GB
“What will the golf club of the future look like? In my opinion, private
clubs will continue to be golf-driven but will increasingly be about
value and building relationships and enriching lives. In fact,
that’s becoming our company’s core initiative. . . Although we cannot
predict exactly what the club of the future will look like, we can work
to create innovative programming. But unless it is relevant to members
and we continue to help them connect with family and friends, it won’t
matter. People join clubs to be a part of something bigger. As we
evolve to reflect the changing culture of America, operators must stay
focused on building relationships and enriching lives.”
Resorts
Martin Kauffman in his Feb 24th editorial
Resorts must define themselves “to break from
the crowd and establish a lasting relationship
with consumers, it’s clear that resorts need to
focus more on differentiating”
Course assessment
% programs for
children
% of programs for
teens
% programs for
adults
% programs for
families
% programs for
women
% programs for
the disabled
Municipal Golf Course Assessment of the NRPA/PGA
91.7% programs for children
91.9% programs for adults
53.2 programs for families
78.5% programs for women
19.3% programs for the disabled
Two Thirds of respondents do not offer an
to Welcome Community Residents to the golf facility
FIVE STAGES OF IDEA ACCEPTANCE
1. It’s irrelevant to this situation.
2. It’s relevant, but it’s unproven.
3. It’s proven, but it’s dangerous.
4. It’s safe, but it’s not sellable.
5. It’ll sell, what a Great Idea!
What a Great Idea! The Key Steps Creative
People Take Charles Chic Thompson
"The innovator has for
enemies all who have done
well under the old, and
lukewarm defenders in
those who may do well
under the new.“
Machiavelli, 1513
Customer Segmentation
1. Brand-loyal customers - Experience
• course or destination direct
2. Brand-agnostic customers - Experience
• any similar course in the same type and price point
3. Brand-disloyal customers – Price driven
• Priceline, Last minute golf
UNDERSTANDING
COMMODITIZATION
High
DIFFERENTIATION
experience
service
product
commodity
Low
PRICE
Programming Over Price
High
What
What is
is aa third
third party
party provider?
provider?
Anyone other than the golf course
who books rounds
Typically golf portals, golf packagers,
wholesalers, travel agents, golf pass books, search engines
Can be owned and operated by a group
of owners and operators
Example of Third Party Site
Example of Third Party Site
Example of Third Party Site
Example of Third Party Site
Example of Third Party Site
Role of the internet . . . Loyalty to your course or a
third party brand?
Enabled by
Internet
Source: Marriott eCommerce
(Frequency of Interaction X Intensity)
Brand Experience Impact
High
Low
Planning
Booking
In Transit
On Property Post Trip
Role of the internet . . .
An effective way to collect customer data and preferences
Photo contest
Sweepstakes
Packages
Tee times
Registrations for programs and events
Sweepstakes
etc. . .
What is 1 Free Tee Time per Day Worth
Colorado study Jim Keegan
One Tee time per day
1
Sold to a foursome
4
Rack Rate
For 30 courses
For 240 golf season
$30.00
30
240
Value of Free Golf
$864,000
Percent being sold: 33
$285,120
Why Coupons Books Don’t Benefit the Course
Colorado Study Jim Keegan
Number Sold
Rate per book
Earnings to vendor
7,500
$79.95
$599,625.00
Free Golf Given Away
21 free rounds
Total rounds donated
157,500
Cost per round donated
Value forfeited by CO
courses
$30.00
$4,725,000
Colorado Study continued . . . The Harsh Reality
• The golfer who receives a free round typically will spend less
in your pro shop.
• The golfer who receives a free round has only a 16%
profitability of returning to that course and paying the rack
rate. (Colorado study)
• Thirty eight (38%) of your core customers will migrate to the
discounted rate plan with the first twelve months.
• Sixty four (64%) percent of golfers that redeem a coupon
usually bring only 1 other player.
• Your average daily rate will be lowered up to 48%.
Yield Management Do’s and Don’ts
Example of hidden costs
Flexible Model
Average Price
Wholesale Price
(25% mark-up)
Cost
Percent
Average
Peak
$ 60.00 $ 100.00
$ 48.00
$ 12.00
20%
• In the flexible model, the
golf course can choose to
close inventory when they
don’t need the business
preserving their profit.
Allocation Model
Average Price
Wholesale Price
(25% mark-up)
Cost
Percent
Average
Peak
$ 60.00
$ 100.00
$ 48.00 $
$ 12.00 $
20%
48.00
52.00
52%
• In the allocation model the
golf course has very few
blackout dates so they must
offer inventory even in peak
periods.
• The golf course’s costs
increase from $12 to $52 as
they move into peak periods
Why consider?
• It’s an advertising medium and a distribution
channel
• It’s based in technology
• It’s growing rapidly
• It’s global
• It proposes to be “free”
• I have to make budget
• Everyone else is doing it
The
The essential
essential promise
promise of
of third
third party
party
providers
providers
New and incremental business
IF you chose to do business with a third party
do you have an agreement in place
to drive and measure this promise and have you proactively
tried programs and yield
strategies to increase your rounds and revenue per round?
The perceived advantages:
•Offers to provide a means of marketing your
facility at no direct out-of-pocket expense.
•Offers to be a means to reach new channel of
customers and fill holes in your tee sheet.
•Offers to bring in incremental business, e.g., out
of town golfers that you would not normally see.
In many cases, the third party will handle the
technology needs of the program.
The
The perceived
perceived advantages:
advantages:
• Control of tee sheets and databases
• Ease of analysis
• Service…ease of booking for golfers & travel providers
• Productivity...yield management opportunities
• Improvement of staff productivity
• Potential for greater profitability
The potential disadvantages:
You lose control of managing the relationship with
your customers. The golf consumer may be trained
to look for and pay for only discounted golf. The
perceived “value” of your golf course is diminished
in the consumers’ eyes and their willingness to pay
full rack rate or book in advance is discouraged.
“The internet commoditizers
brands.”
“It’s all about price.”
The potential disadvantages:
Some third party wholesalers/discounters in
specific geographic areas have grown in such
scope they control so much of the tee time
inventory they have gained leverage over the
owner/operator, similar to hotels.com,
expedia.com.
The potential disadvantages:
Third Parties can and have separated the
owner/operator from their customer base.
Separation from your customer base may fracture
any emotional ties and sense of loyalty that is key in
establishing repeat business.
Operating yields decrease.
The potential disadvantages:
Third parties can and have generated advertising and
other revenues by selling access to customers
(“eyeballs”) that come to their portals to book tee
times at your course and this revenue is not shared
with the golf course or courses in that market area.
Who is your customer and prospective customer going to be
loyal to?
Purchasing online can be the deepest brand
experience the customer has before actually
stepping foot on your facility
Do you want that initial experience to be with
your course directly or with a third party. If it
is with a third party do you have a contract
that guarantees your brand message and price
integrity?
Consumers create demand
Product - Price
Supply
Consumer
Demand
1 week vacation in
Palm Springs
Intermediary
–Expand reach to consumer
Online Travel Distribution in
Lodging
Online
Third Party
Discount
Supplier
Direct
Elements
Elements to
to consider
consider before
before entering
entering into
into
an
an agreement
agreement
Determine how many times, what days, and
when you need to supplement your business
List and evaluate what you are doing
proactively to market, communicate, and
promote your business
Do you have structured programs targeted
specific types of customers?
Are you using email marketing and your
website to build your direct channel of
business?
Create and manage loyalty and retention programs
Build your brand promise on attributes
other than price
Focus on customer service with your
staff
Elements
Elements to
to consider
consider before
before entering
entering into
into
an
an agreement
agreement
Do your due diligence
Ask for proof of results
Check references
Look for hidden costs, e.g., donated tee times
Ask other owners and operators . . . Use the
NGCOA member only listservs
Elements to consider before entering into an
agreement
Run an analysis for each distribution partner. Key questions to
answer are:
– How many tee times do you need to supplement your direct
business
– After determining the number of additional tee times
needed, then ask
• Which partner delivers the best revenue per tee time
weighing in factors such as booking costs and allocations
• Which partner can deliver the most tee times when you need
it. (not just during peak periods)
• How many partners do you need? If you can supplement your
direct business with flexible partners, then you don’t need
to enter into allocation agreements
– Be aware of sales traps
– Never be afraid to say no.
Elements
Elements to
to consider
consider in
in aa contract
contract
Term - none
Transferability - none
Performance Standards
Implied partnerships
Control of your web address url, brand,
content, trademarks, copyrights,
photos, etc.
Marketing approval
Elements
Elements to
to consider
consider in
in aa contract
contract
Specify use of opentravel.org interconnectivity
standards
Control and protection of customer database
Maintain “most favored nation” best rate
guarantee
Sell at retail whenever possible
Control payment terms . . . You get your money
#1 Avoid exclusive agreements of ALL types
What
What to
to do
do with
with this
this information
information
•Work
•Work collectively
collectively to
to adopt
adopt best
best practices
practices
•Beware
•Beware of
of sales
sales traps,
traps, e.g.,
e.g., extortion
extortion and
and
coercion
coercion 101
101
•Promote
•Promote best
best practices
practices with
with your
your circle
circle of
of
influence
influence
•Promote
•Promote best
best practices
practices with
with allied
allied associations
associations
Seek out the least educated owners/operators
Seek out the absentee owners
Promote best practices with allied associations
Third party providers then act as fill in business with you
in control….
Golf
Golf course
course owners/operators,
owners/operators,
accommodation
accommodation and
and attraction
attraction providers,
providers,
and
and DMO’s
DMO’s gain
gain the
the best
best results
results when
when they
they
take
take control
control of
of the
the process
process for
for marketing,
marketing,
selecting
selecting aa computer
computer system,
system, automation
automation
solutions,
solutions, web
web services,
services, packaging
packaging and
and save
save
time
time and
and money
money for
for themselves
themselves and
and the
the
vendors
vendors they
they are
are considering.
considering.
Be
Be proactive
proactive .. .. .. Keep
Keep control
control of
of your
your tee
tee
time
time inventory
inventory
Measure the effectiveness of your programs versus your
competitive set of courses in your market
Financial Benchmarks and Economic Impact
•Provide accurate, consistent set of metrics to educate
owners, operators, buyers, seller and lenders access to more
sources of capital at more favorable rates which will lower the
costs of operation
•Shape collective, accurate industry message to the general
public and media
•Serve as credible, consistent source of industry information
used to formulate responses to governmental and environmental
agencies
•Disseminate information on best practices for course owners
and operators
FIVE STAGES OF IDEA ACCEPTANCE
1. It’s irrelevant to this situation.
2. It’s relevant, but it’s unproven.
3. It’s proven, but it’s dangerous.
4. It’s safe, but it’s not sellable.
5. It’ll sell, what a Great Idea!
What a Great Idea! The Key Steps Creative
People Take Charles Chic Thompson
MISSION STATEMENT
To enhance the lives of golf course owners by
making their businesses more profitable, more
efficient, better managed and more stable.
What
What is
is the
the NGCOA
NGCOA doing
doing to
to promote
promote best
best practices?
practices?
•Education
•Education
•Chapter,
•Chapter, national,
national, and
and allied
allied association
association meetings
meetings
•Meetings
•Meetings with
with technology
technology providers
providers
•Postings
•Postings on
on NGCOA
NGCOA member
member only
only listservs
listservs
•MIS
•MIS Guide
Guide and
and Directory
Directory
•Inquiries
•Inquiries from
from individual
individual owners
owners and
and operators
operators
•Promotion
•Promotion of
of opentravel.org
opentravel.org
Tipping Point
Little Things Can Make a
Big Difference
You influence public
opinion
Be Passionate
Be obsessed
Have perseverance
Be persistent
Smile ☺ and have Fun!!!
Resources
www.ypbr.com
www.golfdatatech.com
www.golfweek.com
www.TIGglobal.com
www.hsmai.org
www.ngcoa.org
www.golfbusiness.com
www.golfindustryshow.com
www.golf2020.com
www.playgolfamerica.com
www.juniorlinks.com
“May the best times you’ve ever
had be the worst that you will
ever see”
CONTACT INFORMATION
National Golf Course Owners Association
Mike Tinkey
Deputy Chief Executive Officer
800-933-4262 Phone
843-881-9958 Fax
[email protected]
www.ngcoa.org
QUESTIONS & ANSWERS