April 2021 Update
The golf season is upon us for most of the country. Vaccinations are rapidly increasing, unemployment rates are declining, and the economy is brightening – a lot of positive momentum that will likely provide more competition for discretionary time. As we continue to experience tailwinds, allow me to share a few thoughts that might prove useful moving forward.
Apple has announced a significant change to the way iPhones and iPads track user data. The Apps used on these devices will now be required to display pop-up messages asking permission to track and share personal information with data brokers. Users will be able to easily deny permission, disrupting the business model of “free” Apps that profit from the sale of user data, i.e Facebook which generates substantial revenue from data-driven advertising. Hence, digital communication tools will have even greater impetus and potential difficulty to become increasingly relevant and personable, a similar transformation from e-mail to “me-mail.”
Millennials and Gen-Z Golfer Growth
Fresh faces continue to fill golf courses nationwide. In fact, Millennial and Gen-Z participation has grown dramatically, accounting for almost one third of current golfers. Changing golfer demographics in conjunction with privacy changes on social media further substantiates the importance of marketing technology. Understanding how to engage and market to these groups is crucial. For the relative newbies, we are happy to share some of our best practices when it comes to digital marketing and the respective vehicles utilized to create a holistic approach to attraction, retention, and engagement of current and past customers.
As an aside, if you are tempted to discount the younger generations due to a lack of buying power, “Dogecoin” (a meme cryptocurrency) just reached a market cap of $50 Billion Dollars – that’s more than Ford Motor Company. Reddit investors almost melted down the entire stock market betting on a videogame retailer – GameStop. There is significant discretionary spending that should not be ignored.
Small Business Optimism
Main street is improving as restrictions are eased. The small business optimism index reported growth in 7 of the 10 index components, including sales expectations for the next three months; however, the overall index remains at historically low levels. No surprise to golf course operators, but 42% of small business owners reported job openings could not be filled and almost 50% of small business owners are reporting compensation increases in the past 6 months or the next 6 months. That said, the cost of capital is extremely low and golf usage remains strong which would signal an opportune time to reinvest in your business or create a complimentary non-core amenity/profit center.
- Seeing Matsuyama’s caddy pay his respects to Augusta National at the end of the final round. Actions speak louder than words.
- Matsuyama walking through Atlanta Airport carrying the champions green jacket as he is flying commercial home to Japan. How refreshing.
- The renaissance of golf due to the positive impact of COVID. The resetting of rates - less discounting and more online pre-payment – provides benefit short and long-term.
- Imitation is the sincerest form of flattery, hence, with the low cost of capital should a “Golftainment”/F&B amenity repurposing be explored.
- If not now, when? If the latter half of 2020 and 2021 is not a boon for daily fee golf course owners, I would love to learn about the obstacles preventing success.
If any of this resonates or you wish to compare best practices and initiatives to implement, feel free to reach out. We look forward to our next conversation.
All the best,