2005: Business - Program mines data on course operations
Wednesday, September 28, 2011
As a former hotel executive, Hud Hinton was used to seeing regular market data such as occupancy rates and revenue per room. He hasn’t had comparable operational data since he went to work six years ago for Troon Golf, where he is president.
That might soon change. Golf Datatech, better known for its monthly reports on retail sales of golf equipment, recently has begun gathering operational data from about 200 courses in Atlanta, Phoenix and Las Vegas. If the firm is successful in expanding the pilot program to markets around the country, terms such as RevPUR and RevPATT might become commonplace in golf.
Faced with too many golf holes and too few golfers, course operators have been clamoring for data that can help them make more informed pricing and marketing decisions. The National Golf Course Owners Association organized the Financial Benchmarks Program and enlisted Golf Datatech to manage the project.
“In the past, we didn’t think we had a problem,” says Ben Blake, president of Links Corp. LLC, which operates 20 courses. “Now we do, and we’re trying to find solutions.”
The NGCOA’s Bill Gurney saysthe project also is important because “a credibility issue had bubbled up” among the financial community with regard to golf course operations.
Initially, Golf Datatech will collect data on courses’ available rounds (total capacity), rounds played and round revenues (green and cart fees). From that, the firm can calculate revenue per utilized round (RevPUR), revenue per available tee time (RevPATT) and the course-utilization rate (rounds played divided by rounds available).
Courses will see how they stack up to competitors in their Competitive Golf Marketplace (CGM). Provided enough courses participate to ensure confidentiality, operators also will be able to see how they compare to competitors in their Rate Set, based on $25 increments of green fees. (Sample reports are available at www.golfdatatechcgm.com.)
Atlanta, Phoenix and Las Vegas are the CGMs being used in the pilot program, but course operators say they eventually want data segmented so they can gauge how their properties are faring against competitors within a 5- or 10-mile radius.
“You’re not competing against every $50 golf course in the Atlanta market,” says Peter Hill, chief executive of Billy Casper Golf, which manages 58 courses. “You’re competing against, maybe, 11 others.”
The cost to participating courses is $200 the first year and $100 annually thereafter, with an initial six-month, no-obligation trial period. Course-management companies will pay no more than $2,000 annually.
Golf Datatech also is gathering private club data on rounds and memberships, but not revenues because private clubs’ fee structures typically aren’t comparable.
It’s unclear how fast Golf Datatech will be able to ramp up in new markets. Cindy Acree, executive director of the Georgia chapter of the NGCOA, says she wants to expand the pilot program statewide, and Bert Coghill, president of the Illinois chapter, says he plans to promote the project at his members’ next meeting.
Golf Datatech partner Tom Stine says he’s talking with other NGCOA chapters and interested course owners. His goal: Convince course operators that this data will allow them to make decisions that boost profitability.
“One report is cool,” Stine says.
“Six reports is practical.”
Convincing course owners of that will take time.
“If it’s a nine-inning game,” says Hill, “we’re still in the bottom of the second.”