View From the Spire: Golf’s Big Problems

On one hand the business of golf is blooming – televisual interest is on the up, players are earning more than ever before and, due to a number of UK based major victories, interest in the home grown elite is probably higher than ever before.

However, underneath the elite games’ increasingly celebrity-esque exterior, lies the other side of the business of golf: a world where many Clubs are struggling to generate revenue that keep them solvent; a world where the most elaborate, well thought through and supposedly well financed of new developments fails to complete, a world where the governing bodies and stakeholders appear to be doing little to stem the haemorrhaging that in time threatens to kill the game altogether.

There are a number of significant factors that contribute to the potentially sorry state of the global game and these should be addressed to ensure the continued success of our sport. I will touch on a few areas (although I know there are more) largely highlighted from experience mostly in the US that may spark the answers for the UK and further across the globe before it is too late.

Too many courses, not enough players

The US National Golf Foundation reports that the number of golfers in the US has declined by 3 million since 2005 and the number of annual golf rounds played has dropped by more than 30 million since 2000. The economy’s slowdown, family considerations, work and other time and monetary constraints are cited for the falling numbers of participants and there has been no surge of players taking up golf and sticking with it as was forecast by some pundits a few years ago. With no overall “demand”, what has to happen to create the demand, increase facility use and get golf back on track?

Exclusivity

There are too many golf courses that cost too much to play, not enough players to fill their empty tee-times, and a continuous trending towards exclusivity. Corporate golf is on the decline and the current economic situation must be the biggest problem facing the golf industry today. Do we need to close or change courses across the globe in order to create more affordable, usable and ultimately useful ones that attract the younger or those learning the game?

Residential real estate

Residential real estate (the root cause of the recession) had been the driving force for golf course construction. With real estate on the rocks hundreds of golf courses are in trouble; many bankrupt, others closing and many more on the precipice of survival. It is suggested that we have as much as 25 percent too many courses and as such we will continue to see courses failing. Even if there is a quick recovery, will the industry ever be the same?

Retail pricing

With the advent of online retailing, many golf retailers in the sector are constantly battling a pricing war – not helped either by short product cycles of manufacturers. However it is noticeable that the humble Club Pros don’t appear to be keeping up; instead still believing it is right to charge 70 or 80 pence for Mars bars, several hundred pounds more for standard stock equipment and green fees and lesson costs disproportionately high for the calibre of course or the Professional. So does the future of golf just hinge on getting its pricing right?

Women and children

The philosophy of nearly every club right now is that kids get in the way of adult play. The industry is set up for men and advanced players and golf courses in the future have to be places for families. And the facts back this up: in the US, the number of golfers aged 6-17 dropped by 24% to 2.9 million from 3.8 million between 2005 and 2008 while the number of rounds played is down causing many courses to close.

Many agree that the future of the game revolves around the appeal to young people who are more accustomed to holding a video game controller in their hands than a golf club. However, women (both current and former golfers) were interviewed and also said courses investing money to make “women-friendly” changes would receive more play and more significantly they would be willing to spend more money to maximise an investment in membership of an “ultimate” golf facility.

The future of golf is in the hands of those who listen closest to what the average players want or pay the likely consequence as golf is a game that at this point in time requires true global leadership to help steer us away from its current self harming practices.

For further information or to add to these discussion points, please leave your comments below.

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About davidmorganjenkins
I am an experienced international, commercial, strategic business leader delivering customer focussed initiatives for world class leisure & sports brands. I have a credible track record of leadership and senior management experience in particular with business operations, marketing & business development within leisure, sport, ecommerce/retail & B2C sectors. I have a unique creative vision, supported by sound financial management & budgetary responsibility having increased brand awareness, sales & core revenue by 60% & profit 200 % at Football Aid over a 3 year period. In parallel, I am centred on attention to detail ensuring a consistent product offering and the greatest possible customer experience. This is delivered through strong collaborative teamwork and creating a culture of creativity, determination and enthusiasm amongst team members. I possess an ability to cement & develop relationships at all levels and can easily engage, report to & upwardly manage share & stakeholder alliances ensuring delivery of business objectives. Key skills Developing & implementing business plans focussing on sales, profits & volume Bringing sales & marketing strategy to life to inspire customers; making visions/dreams a reality Customer service; driving enhanced customer satisfaction & delivering a reputation for excellence Developing, influencing & implementing plans & partnerships that deliver competitive advantage Effective planning & delivery of multiple channel, venue & geographical programmes & projects Leading & managing operation, marketing & business development teams to believe in their ability to succeed Experience headlines Commercial; sales, strategy, development, marketing, sponsorship, promotion, customers service Business administration: P&L, performance, improvement & operational management Marketing & brand; communications, brand management, development & membership/loyalty Ecommerce & retail; FMCG, optimisation, data (CRM), social media, SEO, PPC & affiliates Technology; CRM, web TV, new media, smart phone/iPhone applications

3 Responses to View From the Spire: Golf’s Big Problems

  1. Simon Whitwham says:

    Interesting article David. I agree that we now have too many courses in the UK following a blitz of developments in the 90s in particular when it was believed that many more courses were required to meet demand. I started in the 70s when membership of a club was where it was at and golf was probably the member’s only sporting pursuit. Lesiure habits have changed massively and time constraints appear to be worse (not sure that is actually the case), so a long game of golf on a Saturday can be an issue for families. Football takes up less time for kids, so does tennis and swimming training sessions are generally 2 hours maximum. So for kids there are many other sports that can be pursued that don’t use up too much of Mum and Dad’s time (cricket is the exception!!)

    The costs of maintenance have risen and at my own club our fuel costs are up 60% on this time last year (tax on agricultural diesel as the Governemnt tries to stem the deficit!). So keeping a lid on this and all the health and safety and compliance requirements over here is now a constant battle that costs money. This will ultimately be reflected in annual subscriptions and green fees. Clubhouse upkeep is another ongoing cost. Established clubs that have a good level of membership and remain focused on providing value for money golf and a good social side will succeed.

    Many new proprietary and corporate set ups have failed because they have failed to provide a good facility that represents value for money, either via annual subscription or on a pay and play basis. The better ones have provided a practice range, a good clubhouse and a good cousre, and some have done it in that order by re-investing at appropriate times. Many new cousres have been featureless and wide open – not an attractive proposition to a “good” golfer but OK for a new starter.

    I note with interest the USGA initiative of “Tee it up” i.e take the tees forward and make the course shorter so you get round quicker. Regrettably, this initiative ignores the fact that even on a short course people will still top it, chunk it, shank it, knock it in the water, knock it out of bounds, lose a ball in the rough, and not know the rules or etiquette. I am not sure “Tee it up” will solve the problem of slow rounds.

    Where that leaves us is that, as in all things in life, some clubs will succeed and some will fail, people will take up the sport and people will leave it. Listening to average golfers is all well and good but the dangers here is that bunkers could be filled in, rough cut back, trees chopped down and lakes filled in – so you are lft playing in more or less a field. I’ve played those courses and they are unappealing!

    Golf is ultimately a test of skill in defeating your own demons, let alone the golf course! It will still be around in several hundred years time, I am sure of that, but it will be in a different shape than it is today. You are right that global economic conditions have hit playing numbers (members or occasional green fee payers) hard and that is to be expected; leisure spend goes first in tough times. But golf will bounce back because the likes of McIlroy, Fowler etc. will bring kids and adults to the game. Everything is scyclical and just as we are in downswing now, things will swing back up again and the follow through will be good!!!!!!!

    Simon Whitwham

  2. David – You make a number of very valid points. We have heard statistics that indicate upwards of 3 million golfers leave the game each year! Of course, a number also take it up so the net loss is less than 3 million. I am the CEO of OnCore Golf and we are trying, in a small way, to address several of the issues you raise. OnCore’s flagship product is the Omen(TM) golf ball which can make the game much more enjoyable for the average amateur player who suffers from hooks or slices off the tee. From the feedback we have gotten so far (the ball was just launched in May, 2011), most players love it. They feel more relaxed with their tee shots and wind up with fewer lost balls and less time spent hunting in the woods or high grass for errant shots. That will hopefully keep more people in the game and not quitting due to frustration. We have also seen that players with somewhat slower clubhead speeds (largely women and younger players) really enjoy the ball as well. And importantly to many golfers, this is not a “cheater ball” like the Polara. The Omen(TM) was designed to conform fully with all of the USGA’s metrics on golf balls. Anyone wishing to experience the ball can go to http://www.oncoregolf.com and purchase it online.

  3. The Game

    The Rules describe the Game in terms quite sparse:
    “To Stroke the Ball with Clubs, within the Rules,
    From Tee to Hole.” That’s it. Sounds like a farce
    Engaged in by communities of fools.

    Scottish shepherds started this while bored
    With tending to their flocks of goats and sheep.
    They took up sticks, then swung at stones and scored
    Wherever they went in, six inches deep.

    Since then, we’ve fallen to the Game’s full thrall.
    We even took a Titleist to the Moon.
    One small step for Man, one big for Ball–
    No wonder prophets say our doom is soon.

    But if you’re thinking Golf is less than lame,
    You need to get a life, not just a Game.

    From Golf Sonnets by James Long Hale
    http://www.Golf Sonnets.com

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