News & Opinion

New course of action drives revenue gains

Last winter, I randomly received a book in the mail that would change my life as a golf course operator. It was entitled, “Golf: The Untapped Market: Why the Pros are Failing to Grow the Game.” Honestly, I was somewhat offended by the title, and I had never heard of the author, Chuck Thompson. The book sat on my desk until I needed some airplane reading on a quick trip to Florida.

Once I started Thompson’s book, I could not put it down. I actually read it twice in a five-day span. His assessment of the golf industry is the most accurate and brutally honest account that I have seen. He discusses the four types of golfers: core, avid, casual and non-golfers.

According to Thompson, core golfers play at least 50-100 rounds per year and tend to stay loyal to their home course unless the rates go up. They play the most and spend the least. Avid golfers play 25-50 rounds. They are non-committed golfers and play where they get the best deal.

Casual golfers are consumers who play 8-12 rounds per year. They play where their friends play and don't necessarily know the ins and outs of the golf business. Thompson says they are the future of the game. Non-golfers have shown an interest in the game through their buying habits. They play fewer than eight rounds a year but are more apt to spend in the profit centers. Because they are consumers, they play golf for the experience and want to enjoy it to the fullest, and they will spend freely.

Thompson reveals how the majority of courses mistakenly target a very small portion of the market by focusing their attention solely on the core and avid golfers, whose numbers diminish yearly because of aging and insurmountable competition in many markets.

I called Thompson and shared my enthusiasm for his book and asked him to describe his campaigns. As he explained how his program works, I thought to myself, If I hadn’t read the book, I would think this guy is crazy, because on the surface, it appears that he proposes giving golf away.

Mulligan Marketing Concepts (www.golfmarketingmmc.com), which Thompson founded in 2006, has worked with more than 350 courses in the U.S. As with many great ideas, his concept is simple: generate volume by targeting casual users and redirecting the revenue stream. The idea is to collect less money per person upfront but sell to more customers who would spend more than my existing avid and core golfers. The concept has been brilliant.

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Chuck Thompson

Thompson has developed a comprehensive marketing plan that differs greatly from those of traditional marketing companies. MMC does not require a retainer or upfront money when a course signs a contract. This is huge for cash-strapped owners who simply can’t afford the expense or the gamble of getting a return on a marketing investment. MMC gets a reasonable commission of the membership sales, and the course retains 100 percent of the operational revenues.

This is our 25th season at The Legends Golf Club, a 45-hole facility in Franklin, Ind., about 25 minutes south of downtown Indianapolis, so Thompson suggested that we call this new offer an “anniversary membership.”

Our campaign launched Jan. 15. Three staff members and I could not keep up with the call volume. Within the first few days, our phone system was overloaded with calls and shut down temporarily. We recorded more than 1,000 membership sales in the first week. Our campaign closed on April 22 with more new members than I could have imagined, the vast majority of whom are new customers.

The upfront membership money allowed us to buy some new turf equipment, additional golf cars and do some much-needed building renovations. We were able to increase our chemical budget in the maintenance department. More staff has been hired to service the golfers. Everyone playing at Legends is getting a higher-quality facility thanks to the financial resources that MMC’s plan generated.

The most important thing that Thompson did for us was to bolster Legends’ operational revenues. Through Aug. 31, we have played more than 38,000 rounds in 2018 compared with 22,000 at the same point in 2017. Revenue is up significantly: green fees and cart (32 percent), practice range (38 percent), golf shop (33 percent, including a 77-percent spike in sales of staple items such as balls, gloves and hats) and snack bar (66 percent).

Today, many golf courses are operating at less than 30 percent of their tee-time capacity. Owners find themselves pouring cash into the operation every year just to keep the doors open. Labor Day traditionally arrives as a depressing benchmark for many courses because their prime revenue months are over and the money in their bank accounts will not float the course through the winter. I know this because I have been in similar straits far too many times in the past 25 years.

We have experienced some good growing pains. GolfNow manages our Fore Reservations software system, and we have continually upgraded the system to allow for the tremendous volume of 24/7 online tee-time bookings that we encourage. Still, many golfers call for tee times, and we have hired additional staff to answer the phone. A new fleet of rangers/starters has been hired to ensure that we produce a positive pace-of-play experience. Golfers at Legends will play in four hours, even on the days with 300-plus players.

Chuck Thompson thinks differently than typical “golf industry guys.” During the short time that I have gotten to know him, I have noticed that he is somewhat unfamiliar with a lot of the industry leaders, icons, movers and shakers, which shocked me until he explained it one day.

“I don’t get involved with the PGA, follow the Tour, join golf associations or stay up to date with the latest golf gossip because I don’t want my thinking to be influenced by the ‘industry expert,’ ” he said. “I need to think like a casual golfer and consumer. That’s the only way I can engage my market.”

Thompson has it figured out. My course became successful because we followed all of his marketing principles. Another PGA member and owner recently told me, “You must have felt like you jumped off a cliff when you did this.”

I did, but it has been a great landing.

Ted Bishop, who owns and operates The Legends Golf Club in Franklin, Ind., and is the author of “Unfriended,” was president of the PGA of America in 2013-14. Email: tedbishop38pga@aol.com; Twitter: @tedbishop38pga