The Stimpmeter

A stimpmeter is a tool in golf designed to measure the speed of greens and help course raters understand the severity of slope. Golfers today, especially the better ones, tend to want fast and responsive greens that roll true. It's a concept that doesn't seem to transfer to running the business. Why are golf operations slow and unresponsive when it comes to marketing and adapting to changes in consumer behavior? In this forum we'll put the stimpmeter on golf marketing practices and discuss new ways to grow the game of golf.

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Will HackGolf stem the tide of declining participation?

PGA President Ted Bishop and TaylorMade CEO Mark King recently announced a $5 million pledge to fund a new initiative to find ways to grow the game (hackgolf.org) In his column, Golfweek's Jim Achenbach refers to Ted Bishop as one of golfs most influential leaders, but his position alone hardly makes him influential. He'll only be proven to be that if and when he can motivate his "troops" to really move the ball forward, which remains to be seen. The carrot and stick approach proffered thru grants by his predecessors in the past met with significant resistance and did little change the state of the game, despite similar discussions over the past decade.



Compared to excessive endorsement spending by manufacturers, the "investment" proposed by Mark King is really a drop in the bucket. More likely than not it will be money poured down the drain with little to show in sustainable results. There have been numerous well intentioned and better funded top down approaches offered thru the years that never lived up to the hype or fulfilled a goal of increasing long-term participation.



There have been lots of ideas that do work. We read about "Best Practices" most every month in industry trades such as Club Business and PGA Magazine. These ideas are created by innovative and entrepreneurial golf administrators who understand the most basic elements of their business and have shown short and long-term financial and participation success for a particular facility. It's far harder and costly to create interest and new golfers, so I fear that often these winners that are just building their base by luring away customers from poorly run competitors. 



Right now the winners in the business of this game understand they are in the entertainment and hospitality (not golf!) business; they understand marketing to their current and potential customers; they understand how to create a brand and how to live up to that brand promise at all customer touch points, and; they are willing to put in the actual effort to accomplish impact-laden goals and objectives. Additionally, they do more than just pay lip service to creating partnerships.  They take the time to develop mutually respectful, win-win relationships with other organizations where there can be synergy in combining efforts. 

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What Business Are You In?

While this post is directed specifically at golf courses, it is really a question that all businesses should be asking when making strategic business and marketing plans.  Its often the starting point of creating a mission and/or vision statement. More often than not, when I ask this question to golf professionals, directors of golf and general managers of golf facilities, they all respond that they are in the golf business.  This mistaken mentality permeates through all levels of the organization.  Maybe this is why recent NGF reports continue to show golf participation rates declining and golf course closings to be 11 times greater than openings! What they fail to understand is that golf is only the means to the end.  All these people are really in the entertainment, fitness and hospitality business.  By failing to understand this most basic premise, they often create an environment that just doesn't fulfill customer needs.   Golf is about the game, socializing with your playing partners or fellow competitors, and maybe having a drink or two, playing on a layout that is well maintained that is both challenging but fair.  We expect to go out and have FUN in a reasonable amount of time. But what do we get instead?   How often have you gone to a course where it seems that your searching for your ball more often than not because the rough is too high (and penal) or the fairways are too narrow?    I've been to too many resorts with 2-inch plus Bermuda rough where you can easily lose a ball missing the fairway by a foot or two.  Who wants a devastating, time-consuming, result for a shot that was pretty darn good? How about course layouts that, even from forward tees have forced carries or hazards that make it too difficult for the average golfer?    Then there's gimmicky, tricked-up, far-too undulating greens with speeds so fast that only the best players might be able to sink a putt. We get all of the above because the course is often being managed by people who also happen to be single-digit golfers (which represents only a small fraction of the total population of golfers).  As architects or course managers, they create a product that may be great for them, but not for the masses. It doesn't stop there! Most research shows that golf participation rates are down because people don't want to spend as much time as they used to on the golf course.   Yet, bean-counters try to cram as many possible tee times during playable hours, often at 8-minute increments simply because the math looks good for the potential to generate more money.  Part of this approach is due to a lack of understanding of basic marketing principles where the only and simplest approach to generating any revenue is based on discounting.  Devalued green fees requires finding more inventory to maintain the same total potential, but this is usually a very shortsighted approach. The result of the above becomes 6-hour unenjoyable rounds, making it no longer fun to play the game.  The experience is less desirable so the value provided by the course is diminished, thereby furthering the discount death spiral.   To make matters worse, the course doesn't invest the necessary resources to ensure a positive experience with all its customer touch points.  They have policies that restrict bringing food & beverage on the course, and then don't provide on course or clubhouse services to fill that void.  They have poorly trained course marshals that should be ambassadors to help create a great experience but instead are rudely trying to push pace without observing whether the cause is the golfer or not.  The entire operation treats its customer like cattle with nary the desire to ensure a great experience! Does any of this sound like FUN!   Creating the right environment is certainly not easy.  It takes a lot of effort,  starting with the basic understanding that what a customer really wants is to have a good time for a fair price.   More hospitality, more entertainment, better experiences and a good time will ensure repeat business and a loyal following and will even allow a course to charge more. As for other types of business, how do you answer the question… If you own a restaurant, are you just in the restaurant business….or is there something more to consider? If you are golf teacher, are you in the golf business or are you in the fitness and education business? Share with us what you do, and then tell us what you think what business you are in!

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How to Build a LinkedIn Marketing Plan that Delivers Ongoing Results

Are you happy with how you are using LinkedIn? LinkedIn offers companies multiple marketing opportunities, but which ones are right for your business? In this article I'll show you five different ways to use LinkedIn to market your business. How do you do start? You'll want to develop a comprehensive and consistent LinkedIn marketing plan&

If you are a golf course that hosts business outings or charity events, or if you have the ability to sell meeting rooms, then your operation should include LinkedIn as part of your social media efforts.

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Get Off the GroupOn Bandwagon

Many courses have become thrilled with the idea of selling tee times via services such as GroupOn or LivingSocial.  They are thrilled when they see rather large sums of money being deposited in their bank accounts.  But at what cost?

The typical arrangement with these services is for the course to take a green fee on its rate card and discount it by 50%.  The service then sells the offer and retains 50% of the sale as its promotional fee.  At the end of the day, a golf course with a $50 green fee gets $12.50 -- often with no restrictions.  

The pitch is often that the service has a gigantic email distribution list.  But like using the major metropolitan daily paper the geographic distribution is far greater than where the most likely customer will come from, and only a fraction of those who subscribe will actually be golfers.  

The first time I saw a course do this and sell more than 2,000 green fees (nearly 5% of its annual rounds sold), I contacted the golf professional in charge and asked if he was happy with the results and would do it again.  He was ecstatic because he just had a deposit of nearly $25,000 hit his bank account.   

If he's lucky, less than 50% will actually redeem the purchase so his effective green fee will still be $25, but at the end of the day neither the $12.50 or $25 in revenue will cover the cost of operating the course.  He'll even be more lucky if only a small fraction of those that purchased the offer were current customers.  

Is the offer actually bringing in new business, or is it cannibalizing the revenue that would have come from existing customers?

At the end of the day, even assuming average revenue of $25 per tee time, the cost to generate $25 was $25!  If 100% of the GroupOn offer was redeemed, the cost to generate $12.50 in business was a whopping $37.50!  GroupOn made $25,000, too!  Why would anyone think this was a wise investment?

Lets revisit the $50 green fee and consider an investment of $10 (20% vs. 75%) to devote to marketing.  Then lets use the same 2,000 green fees as a benchmark for our goal.  If we sold the same number of tee times at the full $50 we would generate $100,000 in sales -- what could we achieve by spending $20,000 in marketing.  The likelihood would be far more!

Here's just one example.  I recently did a simple email using the right database of targeted golfers for a golf course.  That golf course, managed by a large, well know, golf management company,  needed my help because it never took the time to collect customer data to develop its own list.  The result was that one email to a relatively small list generated more than $10,000 in sales.  Even better, the cost was not 20% but only 10% of revenue.   Even better -- they created an offer that they wanted and weren't required to discount 50%!

Just think how much better the course income statement and balance sheet would be if they did this more often then GroupOn.

All it takes is a little extra effort, but that effort pays off!

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Is it worth it for a golf course to advertise in a daily newspaper?

Most golf courses spend far less in advertising (as a percentage of gross sales) then most hospitality businesses, and where they do tend to spend their dollars is in old-fashioned traditional media.  

Resort and upscale courses can be found in slick regional and national publications, the rest will have ads in local newspapers.  Occasionally you'll see or hear about a golf course on radio or television (usually because of a barter arrangement with the station).  But is this the best use of limited marketing dollars?

Most likely not!  You'll get a better ROI spending your dollars elsewhere.  The reason is simply based on math….the cost of the ad vs. the effective reach.  

Depending on your market, if you are placing a weekday ad in a major daily newspaper, the cost per column inch will often range from $100 to $200.  Assuming a 26-week campaign and a very small 1-column inch ad, your annual expenditure will be $2600.  

That may sound reasonable until you calculate your effective reach and cost per thousand.  Based on demographic and lifestyle research (available from the newspapers), approximately 10% of readers will be golfers.   That mean's 90% of your investment is going to waste!

Let's assume the circulation of the paper is 100,000 people.  The cost to reach 1000 readers with a small 1-inch ad is only $10.  But of those 1000 readers, only 100 might be golfers.  Now the cost effective cost per thousand is $100 if everyone was a viable potential customer.  

Unfortunately, the geographic reach of the papers often is far larger than the area where your customers actually come from.  Unless your course is extremely special, most golfers will live within a 10-15 mile radius of your course.  If 50% of the paper's readership is in that range, now your effective cost per thousand is $200 -- and that is assuming all the readers actually saw your teeny-weeney 1-inch ad.

Might there be better ways to spend that annual budget of $2600 and reach a significantly larger targeted market and return on your investment?

Absolutely!

If your golf operation has taken the time to develop a relationship with your customers and has a dedicated effort to capture and build a customer email list, then there are lots of ways to capture more business.

Do you use a mass email service such as Constant Contact that not only allows you to send email to your customers and prospects, but also provides metrics and results?

If not, have you considered developing a relationship with your state/regional golf course to utilize their list of the most avid of golf audiences?

Does your course have a social media presence using services including Facebook, Google+, Twitter, Instagram, YouTube and LinkedIn?  And if, so, do you have an editorial plan for creating regular posts that would be of interest to your audience.

At the end of the day, the key is to build a relationship with your customers and provide them with relevant information and services that have a value so that at the end of the day, you build loyalty and repeat business.

Interestingly, most golf operators fail to do put in this effort because its just easier to create a new discount offer, call the paper and place that little ad.  Those that keep doing this will continue to see business decline as more customer will flock to their competitors. 

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