GolfLincsUK - incorporating Golf Club Marketing.Org

 
Section 3 - Marketing your Club - Challenges Ahead
     
   

Section 3 -The Challenges ahead

 

3.1.  It is worth repeating that golf club memberships have fallen by some 100,000 over the past 11 or so years. Out of 700,00 that is a sizeable fall! Many reasons have been offered, the principal of which is the economic downturn. Forecasters say that the economy is unlikely to improve before 2016 at the earliest; I prefer the optimism of those who look at historic economic cycles and see early 2014 as the turning point. The natural response by club management is to believe that when the economy improves, there will be an upturn in membership applications. This is probably unwarranted optimism and the downward trend will almost certainly continue at the current rate of about 4%. Initiatives by individual clubs may have a marginal effect, but excepting those clubs that enjoy special circumstances, the majority will simply do well to keep the patient alive to allow time to make the quantum changes essential to a healthy future. See Section 4. No developed golfing nation is exempt from the trend. We are simply mirroring the experience in the USA where more than 100 clubs are closing each year. Why is the decline likely to continue?

 

 

3.2.  For many years society has seen the benefit of record low interest rates. Money has never been cheaper. During this period salaries have remained relatively depressed and some have improved very little for more than ten years. At the same time, low interest rates have encouraged substantial financial commitment, not least mortgages taken out by those very people who are or might become golf club members. When the economy starts to recover, interest rates will rise and as someone who was hit by 16% interest rates in the early 1980s, I can say with certainty that every 1% hits like a blow from Mike Tyson. Generally, middle class homeowners are the core of a golf club’s membership and although the interest rate rises will probably be modest, they will certainly precede any improvement in incomes and they may cause many to think about whether they can justify the expense of golf club membership. Moreover, following a recession, consumers are psychologically damaged and often unwilling to make financial commitments because of their fear that there might well be another financial blow just around the corner.

 

 

3.3. 

 

a. To add to the overprovision problem, there will be new golf complexes coming on stream over the next few years. Hotel chains in particular recognize the advantages of having sports facilities associated with their hotels. They may be full of travellers and business people during the week, but there is also the possibility of a lucrative trade at weekends through the provision of golf breaks. These hotel chains will be, not too far in the future, the supermarkets of the golf industry.  Already they offer flexible national packages that are prima facie attractive, even if they are less so when examined more closely. In a couple of years time they will be going global with these packages, the international dimension adding even more attraction for certain categories of golfer. Because golf is not their core activity, there is every prospect that these hotel chains will be able to force further price reductions in the market, similar to those of the supermarkets that have caused the demise of many of our conventional retail outlets. Currently these chains are building a new golfing culture that is certain to threaten the traditional golf club scene in future years. Fortunately, there is still time to take action to mitigate the effects on your club.

 

b. Consider also that many clubs have been increasing their annual subscriptions at a time when green fees have fallen in price. Realistically, in most parts of the UK an annual subscription of £800 is the top of the subscription mountain. Above that figure the weekend golfer is better off paying green fees each time he/she plays. Remove from the 52 weekends the annual holidays, family occasions and bad weather in the winter months and paying a green fee makes good financial sense. True, because of the many benefits one enjoys there are many who prefer to be in a club. However, if you have never been a member those benefits are less than apparent, a situation made worse by the poor marketing performance of the average club. Understanding marketing and getting it right will be vital at the very time time your club may well be trying to contain costs.

 

Other pages offer solutions and there is a pdf at this link that covers many aspects of marketing and management.

 

 

Take at your peril, the view that these problems will not affect you and that action is not required. Remember, you are a business that exists to sell a product to customers. Every business needs a constant and targetted marketing effort.