by

Revenue Management in the Golf Industry

 

Golf Industry Overview 

Golf is a great sport! Why? Because it is one of the few sports that you don’t have to be in shape to play it and play it well! Just google John Daly and you’ll know what I mean. Golf is a very popular sport because it’s social and it requires as much mental ability and concentration and it does physical.

There are more than 35,112 (http://en.wikipedia.org/wiki/Golf) golf courses worldwide and many of them are located in resorts and tourist hot spots. Half of all golf courses are located in the United States and it probably has to do with the abundance of real estate in the country. But of course, like everything else in the world, the next big thing is golfing in China, which has exploded in popularity since its introduction to the country in 1984.

The National Golf Foundation (http://www.ngf.org/) and Golf Digest (www.golfdigest.com) offer plenty of information about the golf industry and its latest news.

Golf is popular amongst both men and women and there are plenty of professional tours around the world. The PGA and LPGA tours and the most popular for male and female professional golfers and they have some of the biggest prize purses in the industry. I think golf is the greatest sport in the world and I am biased because I’ve been playing it since I was four years old. But this is how I convinced a friend: I told him that if I was a famous professional athlete of any sort I would pick golf. Why? Because it’s the only sport where your professional career could last as long as a regular job. I can be a professional golfer until I’m retired! And after that I can even join the Senior PGA tour where I can still make a great living. Just ask Lee Trevino of Chi Chi Rodriguez.

The problem with golf and revenue management is that it usually charges a fixed price and it’s hard to control duration, which places it in Quadrant 3 of the RM levers. Since it is a social sport and depending on the size of the group, type of course and weather, it is very hard to estimate how long it’ll take a group to finish a round of golf.

Space in golf is pretty fixed and it is defined

This is how a round of golf is usually priced:

–       The golfer pays a “green fee” that allows him/her to play a round of 18holes

–       The time it takes to finish the 18 holes varies greatly depending mostly on the size of the group

–       It is categorized as a “gentlemans” sport and it’s considered rude to hurry other players

 

Space

The golf industry defines space implicitly in that they are in charge of the space and they do not require to sell a specific part of that space but the whole course or golf range.

Golf courses divide their space up in different types, duration and distance for their holes. They also add other types of spaces like golfing ranges where they can get additional revenue from customers that don’t necessarily want to play a full round of golf.

 

They can also use the space to generate additional revenue, for example:

–       They have the golf range that serves the golf course

–       A golf pro shop to generate retail sales

–       Professional services like gripping clubs

–       Professional lessons (might not take space but generate additional revenue)

–       Bars (19th hole)

–       Other F&B outlets like restaurants

 

 

Some creative solutions to generate additional revenue using the space could be:

 

 

–      Offer spa and sauna services in their locker facilities if they have them

–       The space could also be rented out for events, such as weddings and outdoor concerts

–       They could do outdoor cinemas at night

–       They could have summer camps at night for kids

 

 

 

 

Time

The golf industry uses time implicitly because it is very hard to know how long it will take a group to finish a round of golf and it is very hard to control it without annoying customers. There are things that can be done, for example:

–       Discount if the group is done before X amount of time

–       Charge for time and not for rounds (problems with slow foursomes)

  • Slower ones must be willing to let faster ones go through

–       Charge different prices based on weather forecasts (a discount for a potentially rainy day, give they sign  a disclaimer)

–       Older people have to be 3 or less per group

–       Field marshals to help ease the time pressures

–       Use ball finders in certain holes to make finding the ball easier (reducing time). This could be very helpful in markets where labor is inexpensive

–       Caddies for bigger foursomes (time controllers and sell them as free caddies or charge)

–       Charge higher for “professional caddies” who will make play faster

 

Price

There are several rate fences that can be used in golf in order to charge different prices at different times or level of service. Some of them were mentioned in the previous point because they go hand in hand with time, but some additional examples are:

–       Charge different prices

  • Morning vs afternoon
  • Weekday vs weekend

–       Golf cart to have fences for bundling and other services

–       Charge for time and not for rounds (problems with slow foursomes)

  • Slower ones must be willing to let faster ones go through

–       Advanced payment to reduce no-shows and determine overbooking levels too

–       Cancellation Fees for no-shows

–       Booking curves in order to determine which days are the ones with the most demand

–       BUNDLING

–       Daily traffic curves to determine what time of days are the best tees (every half hour?)

–       Pay extra to pass a slow “foursome”

–       Charge different prices based on weather forecasts (a discount for a potentially rainy day, give they sign a disclaimer)

 

When it comes to Golf Ranges, which could be an add-on to a golf course or free standing, has a lot of RM opportunities too:

–       Different prices for the bucket at different times based on Curves by time and day of week (with length of stay too)

–       Offer unlimited balls for a pre-determined LOS instead of charging by the bucket… This way we know exactly how long they will last.

–       Offer different quality of balls and charge more or less for them (makes hard to sort them but could be worth the effort)

–       Charge more at night or day depending on demand

–       Offer virtual ranges

–       Time and price could also be enhanced by having some kind of set path:

  • 10 shots at three different distances with three different clubs

–       Be able to reconfigure the range and/or the booths where the players shoot the balls

 

There are many things that can be done with golf revenue management. But the most important thing to do before rolling out RM initiatives is to test it first. A new RM strategy might sound exciting but it could be a potential source of dissatisfaction with the customer and reduce revenue instead of improving it.

24,003 thoughts on “Revenue Management in the Golf Industry”

  5. I am often to blogging and that i really appreciate your content regularly. The article has truly peaks my interest. I’m going to bookmark your website and maintain checking for brand spanking new data. antivirus a virus

  7. I have learned newer and more effective things by means of your blog. One other thing I’d like to say is that newer personal computer operating systems are inclined to allow extra memory to get used, but they likewise demand more memory simply to function. If a person’s computer can’t handle extra memory and also the newest computer software requires that memory increase, it could be the time to buy a new Laptop. Thanks 學日文

  11. Check out different facilities for beat making online and find out one that suits you best. Beat-making is a popular hobby today. There are a good number of options to combine so you only have to twist and turn. 學日文

  12. Please let me know if you’re looking for a author for your site. You have some really good posts and I believe I would be a good asset. If you ever want to take some of the load off, I’d really like to write some content for your blog in exchange for a link back to mine. Please blast me an e-mail if interested. Regards! 學日文

  13. That is the right web site for everyone who wants to find out about this area. You realize that much its almost difficult to disagree with you (not that I actually would…Lol). You certainly put a completely new spin on a matter thats been discussed for a long time. Great stuff, terrific! 學日文

  16. I would also love to add that when you do not currently have an insurance policy or maybe you do not take part in any group insurance, you might well make use of seeking the aid of a health insurance broker. Self-employed or people who have medical conditions generally seek the help of any health insurance broker. Thanks for your blog post. 學日文

  18. Good post here. One thing I’d like to say is most professional areas consider the Bachelor’s Degree just as the entry level requirement for an online certification. Even though Associate Qualifications are a great way to begin with, completing the Bachelors starts up many opportunities to various jobs, there are numerous online Bachelor Diploma Programs available by institutions like The University of Phoenix, Intercontinental University Online and Kaplan. Another issue is that many brick and mortar institutions offer Online versions of their degree programs but generally for a drastically higher price than the providers that specialize in online degree programs. 日語課程

  19. I just could not depart your web site prior to suggesting that I actually enjoyed the standard information a person provide for your visitors? Is going to be back often in order to check up on new posts 日語課程

  20. Youre so cool! I dont suppose Ive read anything in this way before. So nice to discover somebody with a few original thoughts on this subject. realy appreciation for beginning this up. this web site is something that is required over the internet, a person with a little originality. useful job for bringing something new to the web! 日語課程

  21. certainly like your web site but you have to check the spelling on quite a few of your posts. Many of them are rife with spelling problems and I find it very troublesome to tell the truth nevertheless I’ll certainly come back again. 日語課程

  24. It’s actually a nice and useful piece of information. I am satisfied that you just shared this helpful info with us. Please stay us informed like this. Thank you for sharing. 日語課程

  27. You created some decent points there. I looked on the internet for your issue and located most people is going along with together with your website. 日語課程

  28. This web-site is actually a walk-through you discover the knowledge you wished in regards to this and didn’t know who need to. Glimpse here, and you’ll certainly discover it. 日文課程

  29. I’m impressed, I must say. Actually rarely do I encounter a blog that’s both educative and entertaining, and without a doubt, you could have hit the nail about the head. Your thought is outstanding; ab muscles an element that insufficient everyone is speaking intelligently about. My business is happy which i came across this during my hunt for something about it. 日文課程

  32. In the world of link building there are many different types of links out there. One of the most important is edu backlinks. For SEO purposes, edu backlinks are very valuable authority links to your site. When a domain ends with.edu rather than.com, it is generally from an established educational site such as a University or other types of accredited educational institutions. lagu1s

  34. Awesome! I thank you your contribution to this matter. It has been insightful. my blog:PD168FIFA

  37. I think this is an informative post and it is very useful and knowledgeable. therefore, I would like to thank you for the efforts you have made in writing this article. 到會推介

  38. I’m glad I found this web site, I couldn’t find any knowledge on this matter prior to.Also operate a site and if you are ever interested in doing some visitor writing for me if possible feel free to let me know, im always look for people to check out my web site. 外賣到會

  39. Superior post, keep up with this exceptional work. It’s nice to know that this topic is being also covered on this web site so cheers for taking the time to discuss this! Thanks again and again! meongemas

  41. Attractive section of content. I just stumbled upon your weblog and in accession capital to assert that I get in fact enjoyed account your blog posts. Anyway I’ll be subscribing to your augment and even I achievement you access consistently fast. telegram中文版

  42. Can I recently say what relief to locate somebody that actually knows what theyre dealing with on the internet. You definitely learn how to bring an issue to light and earn it important. Workout . need to see this and understand why side from the story. I cant think youre less common since you absolutely contain the gift. image compressor

  45. Hello there, just became aware of your blog through Google, and found that it is truly informative. I am going to watch out for brussels. I’ll appreciate if you continue this in future. A lot of people will be benefited from your writing. Cheers! 바카라사이트

  48. I have learned newer and more effective things by means of your blog. One other thing I’d like to say is that newer personal computer operating systems are inclined to allow extra memory to get used, but they likewise demand more memory simply to function. If a person’s computer can’t handle extra memory and also the newest computer software requires that memory increase, it could be the time to buy a new Laptop. Thanks situs slot bri

  50. This is often likewise a superb subject material i actually fairly seriously favored reviewing. It isn’t really everyday we hold possibilities to clear up a dilemma. hongtogel

Leave a Reply

Your email address will not be published. Required fields are marked *