The Pellucid Perspective - July 2011 - (Page 14)

ever, including the debt service that newer high end properties may face from their initial development, high costs for service and conditioning that customers expect for the price, and the long range difficulty of raising those greens fees back up to their previous levels and beyond when and if the economy improves. Operators whose success depends upon wringing every available dollar out of not only the tee sheet but every aspect of the facility – and these days that includes virtually everyone – may dabble in discounting of off-peak times, but work diligently to protect their rack rate price point and their image in the marketplace. The approach cited by KemperSports EVP for Managed Properties Jim Stegall at one of the company’s top-of-the-market public properties is typical of that approach. Referring to Prairie View Golf Club in the Indianapolis market, Stegall said, “Our primary plan revolved around how (Golf 2.0 continues from page 3) time and money during the middle lifestage years and, as the kids move on and the marriage starts to need some “separate time,” golf re-enters the picture and becomes a welcome diversion and a chance to reminisce on the younger, simpler days of a good walk in the woods. In summary, here’s my assessment of the “hits” and “misses” of the Golf 2.0 program as we now know it: n Hits: Shift in focus to a more balanced attack against the lapsed and the uninitiated, family inclusiveness angle, females as one growth plank rather than one of the “programs du jour,” recognition of kids/no kids differential and tugs on discretionary time and money. n Misses: No plank to address just cloning the existing golfer base among the uninitiated (outreach to older, affluent, white males), vagaries around tracking mechanisms and success criteria as it relates to retention of existing golfers, no component to recognize that core game improvement among existing players (especially low involvement groups) would reinforce and reverse sagging involvement. Not surprisingly, the PGA of America makes some veiled suggestions in the program materials that this new player development effort will need both more and a different mix of PGA professionals. I’m more inclined to agree with the latter half of the strategy (an evolving skill set mix among their membership) and less inclined to think that operators in the current environment are going to be “leaning into” a conversation about adding more PGA members to their bare bones staff. On the other hand, however, if player development can be tracked to have a quantifiable and meaningful addition to the bottom line of the golf facility, I believe that most operators would be open to a self-funding proposition along those lines. I have mixed feelings about whether player development and strategic industry growth initiatives are in the wheelhouse of the PGA of America, but I’m willing to stand on the sidelines and let them have a swing vs. criticize the effort outright. Only time will tell whether they can improve upon the foun- to maintain their brand and image and selectively promote the times they couldn’t sell. One thing we did was some combination stuff with their golf academy, adding more value but still having our price point. We also looked very closely at our core group of customers to find out what price they would pay, and then created a loyalty program at that price, the Club VIP program, with incentives to bring out new guests. That has tended to attract new customers, while maintaining our rack rate.” Regardless of price point, the constant theme from today’s most successful operators is to protect your loyal customers and your rack rate, and take some creative approaches with the times that were slow movers in the best of times. And, as both Stegall and O’Brien emphasized, do whatever it takes to double, or at least increase, your group business. Do those things, add some creative programming, and your chances of remaining among the priciest public properties in the market will increase dran matically. dational work done by Golf 20/20 and the World Golf Foundation. While I think some of the BCG work and recommendations need some serious refinement and better grounding in the realities and limitations of the current golf industry, the PGA of America does have an advantage over the Golf 20/20 structure in that they’re a self-contained single organization that will be less reliant on consensus building and have their own economic base from which to draw vs. “passing the collective industry hat.” It’s in the best interest of all industry stakeholders for Golf 2.0 to succeed but, as I’ve learned in 25+ years in the business world, one must always “expect the best but plan for the worst.” n (Tee Time Marketing continues from page 5) tee times there, but recalls playing at Whisper Creek in Huntley, Ill., with a friend, where they did offer permanent times. “I’m relatively neutral on the economic impact of those,” Perry said, “and I think it’s pulled back a little bit even in places where it used to be a big deal, due to the proliferation of golf courses. But from a facility standpoint, getting cash up front is a huge benefit, especially if it’s after a long winter when you’ve been paying out money without taking any in. As an industry, perhaps we haven’t looked at [permanent tee times] closely enough. It’s uncommon even in good markets to have a fully booked tee sheet these days, and anything that might help is worth taking a look at.” n (Market Focus continues from page 15) for the industry trade associations’-induced oversupply situation coupled with the belief that real estate-related golf was immune from the laws of supply and demand. Like many other of our best-performing markets, if you can survive the correction (and the brutal Minnesota winters in the interim) or buy into it at an extreme discount, the fundamentals to make a solid living and an average return on the investment are there. n July 2011 14 The Pellucid PersPecTive

Table of Contents for the Digital Edition of The Pellucid Perspective - July 2011

The Pellucid Perspective - July 2011
Contents
The PGA of America hits the restart button on player development
Permanent tee times, Chicago style
Positive P.R. leads to course record revenue month
Exploring the alternative golf universe
Jun 2011 YtD weather impact, May 2011 YtD utilization
Life at the top of the market
Minneapolis, MN Core Business Statistical Area (CBSA)
Comings & goings
Musings from the rough

The Pellucid Perspective - July 2011