GOLF MARKETING STRATEGIES

DRIVEN BY FINANCIALS

ANALYZING FINANCIAL

STATEMENTS FOR GOLF COURSES

A CASE STUDY

Welcome to our financial statement

case study. In this article, we are

going to review the financial statements

of a golf course and point out things you

can look for and be mindful of as you

look at your year-end statements. Our

goal here is to support you in learning

and discussing some of the intricacies

of reviewing your financial statements –

how do the numbers speak to you?

In another article, we will talk about

strategies you can take from the trends

we see. What can you differently? What

innovative ideas can you take to increase

revenue? And much more. But first, let’s

focus on what to look for in the numbers

and trends we see in this case study.

First, let’s focus on what to look for in your

numbers. Here are the numbers from a

sample golf course we will focus on for

the rest of the article.

From the untrained eye, one may look

at this golf course’s financial statements

and see that revenues and profits are

up, so clearly there’s nothing else to

see here. But in truth, there are some

disturbing trends that can be seen in

these numbers. If they can be spotted,

researched and an action plan for them

created, they can be mitigated and

turned around for the positive.

In this piece we’re going to pick apart this financial spreadsheet and showcase

the trends we are noticing, and highlight what next steps should be taken going

into the next golf season to help ensure negative trends end and positive ones

continue. LET’S GET STARTED.

This article is a continuation of our previous case study article “Analyzing Financial Statements

for Golf Courses”

CLICK HERE TO VIEW THIS ARTICLE.

Developing marketing strategies to help improve the performance of your main revenue sources is

something every golf professional must spend time on during the off-season. As a follow-up to our previous article on analyzing financial statements, we’re going to spend our time now focusing on specific tactics we could implement to help mitigate some issues we’ve noticed after the review. Let’s get to it.

OPPORTUNITY - Decreasing Green Fee Revenue

CONSIDERATIONS - When viewed in isolation, a drop in green fee revenue would be considered troublesome. However, when you compare this drop to the increase/decrease in sales for tournaments and memberships, you can get a fuller picture of the trend-taking fold. After ruling out external causes like new competitors, bad conditions or poor weather, there are some strategies you should implement.

ACTION - Dig deeper into your green fee players and try to isolate a specific source of the drop. What changes did you make this season that could have had an impact? What changes did your competitors make? Was it weekend tee-times or weekdays? Once you’ve uncovered some potential reasons you can begin to plan to improve results for the following year.

STRATEGY

➊ Review competitor offerings for your slow periods, and create offers that compete. Consider packaging food & beverage offers (such as a $10 food credit) with offers to encourage additional high-margin sales.

➋ Prepare and conduct a survey to ask public audiences what they would like to see for tee-time offerings. Find out why they chose to play with you instead of other courses. Calling some of your public tee-times back in the off-season may be an approach to get usable and actionable data for the following season.

➌ Look deeper into league revenues, and determine if there is room for growth here among your men’s, junior, women’s and senior’s leagues. Review competitor’s offerings in the same space to determine if your offerings are competitive and on the right days of the week for the audience.

➍ Review 9-hole and 18-hole rounds for the year. Is there an opportunity for a 9-hole offering for people who would play after work? Conversely, do you offer a short course for beginners? Catering to and nurturing your beginner golfers will pay huge dividends later-on.

➎ Review your product offerings in relation to the needs of your customers. Do your offerings align? Are you placing barriers with your green fee rates, offerings, memberships and tournaments that are irking your potential customers and forcing them to go elsewhere?

OPPORTUNITY - Declining Tournament Sales

CONSIDERATIONS - Declining tournament revenue without increases in other on-course revenue like green fees and memberships is a worrisome trend.

ACTION - Review your tournaments for the past few years and try to determine your turnover rate. This will tell you how many of your tournament clients are returning year over year and how many are not. If the number of tournaments returning are in decline, here’s some tactics you should try to fix the issue.

STRATEGY

➊ Analyze tournament offerings - First and foremost, you should spend time collecting more information to better understand how you compare to your competitors in regards to tournaments. In addition, this may be the time to reach out to some of the tournaments who left to determine the reason why - there’s no point in implementing huge sweeping changes if a tournament was cancelled due to a lack of interest.

➋ Review your communications strategy - How are you promoting your tournament packages? Are they visible on your website and social channels? How often do you communicate with your tournament clients? Do you follow-up seasonally to re-book spots for next season? Do you customize your offerings to suit their needs? It is smart to review your overall strategy for tournaments and ensure all the gaps are filled to help hone in on the fundamental reason for the drop.

➌ Advertising - In our example, in addition to declining green fees, membership and tournament sales, we have also seen a decrease in advertising. Notably, there is no line item specific to tournament advertising either. This is the time to begin advertising. Look for free opportunities to improve your reach like through adding content online and in articles, but don’t rule out direct mail to potential businesses, printed pieces for your pro-shop, digital ads or even newspaper ads.

OPPORTUNITY - Declining Membership Sales

CONSIDERATIONS - While we saw increased sales in some membership type’s year over year, the trend of all membership sales was downward. This trend is a concerning one.

ACTION - Get more information into the fundamental cause of the drop. Review your membership types and see if they fit the needs of your current members and of the public.

STRATEGY

➊ Conduct a survey with your current members to try to determine if your membership types are suiting their needs. Considering the sport of golf may be struggling to garner interest from younger generations, and there being many perceived barriers to entry (high costs, difficulty of the sport, length of game), membership types may need to evolve. We have begun to see many golf clubs offering a variety of membership types to try and entice new golfers. Membership offerings like non-peak times, twice a week, after 3pm, beginners course memberships, even golf/food memberships are all becoming more common. A survey of your members and analysis of their needs could help you identify some changes to your membership offerings that may help boost sales.

➋ Review your competitor’s offerings. You may find that your rates or offerings are no longer competitive. Further to that, we would suggest reviewing your league performance.

➌ Look at league performance. If your league is also suffering a decline, it could be another cause of the overall membership drop. Once changes are made, be sure to notify your current league members, as they will be your cheapest source of word-of-mouth advertising to their friends.

➍ Look for opportunities for new membership types or approaches to your leagues. Could you league be opened up to the public to help fill the tee-sheets? Do you offer 10-round passbooks instead of memberships for golfers who are not likely to get full value from a membership?

LISTEN TO A PGA PODCAST Creating and Maintaining a Successful

Budget with Wayne Middaugh

PGA of Canada 25 year member and Executive Professional at Port Carling Golf & Country Club, Wayne Middaugh discusses his experience with creating and maintaining a successful budget with fellow PGA member Kevin Layte and Manager of Education & Programs at the PGA of Canada, Matt Allen. Wayne will talk about his unique set-up at Port Carling, how he manages the budget with his senior staff, how to plan for major projects, and most importantly how to maintain budget throughout the year.

OPPORTUNITY - Decreasing Advertising Costs

CONSIDERATIONS - When it comes to decreased sales, the last thing you will want to cut in order to save money is your advertising budget. Or as Henry Ford famously said, “A man who stops advertising to save money is like a man who stops a clock to save time.” With that said, if your course is struggling, it may be time to look more closely at your advertising performance and choice of mediums.

ACTION - Review your current advertising tactics and pull statistics. Once you have stats take a look at the following: what worked, and what didn’t, were your advertising efforts measurable through to conversion/purchase? How did your advertising efforts reflect on your bottom line for sales? If you cannot pull any statistics on performance, you already have an area for improvement in the years to come.

STRATEGY ➊ Review Online Analytics - For most golf courses, this will be your easiest and most detailed source of data. Your website analytics can tell you who your customers are, how they find your website, what they are looking for, what they are struggling to find, what device they are using and so much more. You can use this data to re-structure your website, re-position your business, and most importantly decide the best course of action for advertising.

➋ Setup Tracking - If you cannot track performance of your ads, then there’s no way to know if it’s working or not. At a very minimum, you should be able to review advertising budgets in relation to what you’re advertising to see if you’re getting a lift year over year. For the following seasons however, you should strive to amp up your advertising efforts to include specific tracking. Digital advertising through services like Google Adwords and Facebook can track a customer from impression through to online purchase. Custom phone numbers through services like <blank> can track print ad pieces through to bookings. Surveys conducted post round (perhaps to win a prize) with specific ‘How did you hear about us?’ questions can also bring in valuable data on your advertising performance.

➌ Align Budgets To Sales - Your advertising efforts should align with your goals for the year to come. If your green fees are suffering, advertising in that area should increase, if your food & beverage is doing well, however you want further growth, budgets here should also increase, if you prefer not to focus on lessons, or feel this can be done through other means, then reduce or eliminate budget here. It’s important to track the changes you make year over year and compare the end results.

➍ Setup Future Tracking - If you aren’t currently tracking your advertising performance, it’s time to start. There are multiple ways to track the effectiveness of ads. The following page have a few that should help you gain a better understanding of advertising performance.

OPPORTUNITY - Changes in Food & Beverage Revenue

CONSIDERATIONS - Increases in food and beverage sales when faced with declining traffic on the course like in our example shows you how much impact your restaurants can have on your bottom line. In this instance, it is clear the restaurant is holding its own, and likely is bringing in new non-golfing clientele. This new audience should be leveraged as best as you can.

ACTION - To better understand the cause of the improvement in sales, you must be able to identify the changes from one season to the next. In our example, the improvement seemed tied to a large increase in wages in this department, so it is likely a new chef/staff had an impact. Even when things are going well, it will never hurt to learn more about why and most importantly, there is always room for improvement.

STRATEGY ➊ Determine what contributed most to the improvement in sales - was it a particular menu item or dish? Was it service based or because of the quality of the food? Was it a particular day of the week? Or was it because of an external factor, like other restaurants nearby closing? Leverage the strategies that worked well and look into ways to amplify them, and look to replace or improve menu items that are not selling, or cutting it profit wise.

➋ Review Advertising - If sales are improving, people are talking about your restaurant. This is the time to up the ante and begin advertising. Restaurants can earn your club revenue regardless of the weather, and therefore can be a pillar of your business model. Invite media, bloggers, magazine editors/writers to test and review your food. Most digital marketing agencies or PR companies can steer you in the right direction if you are looking for help.

➌ Start thinking of your restaurant as a separate business and revenue generator. Most golf courses and restaurants are packaged deals, but this does not need to be the case. Allow your restaurant to have more autonomy and to market itself independently to try to increase its brand within the community.

On the other end of the spectrum, if F&B is suffering, this is not a sign that you should increase prices or cut staff

to make ends meet. Laying off staff often leads to a poorer customer experience, and with increased prices, this can often compound revenue problems. The quick solution is rarely the right one. First, gather more information from your food and beverage manager - what is selling, and what isn’t? What is the quality of the food like? What is the quality of the service? In order to improve this trend it may be as simple as changing your menu items, but on the other hand it could require a serious staff overhaul. Look for opportunities to encourage golfers to come in and eat - with daily specials and/or perhaps $10 restaurant credits with each $18 green fee. Look for opportunities to get the public to come in and eat, with or without golf as well.

OPPORTUNITY - Wage Considerations

CONSIDERATIONS - Debt and interest can really weigh heavily on a business. This is not a line item that should be put on auto-pilot, if possible this should be consolidated and paid off as soon as possible. When it comes to other on-going expenses, continually look into options to reduce your costs where possible. Analyze your statements and make sure you’re getting benefits from everything you’re paying for.

ACTION - Don’t just sit on your debt. Speak to banks and loan providers into options for consolidation to pay down your outstanding debts as quickly as possible. Many businesses are paying for services they forgot they were using or paying for. This happens quite a lot with high turnover. Keep a very close eye on expenses and debt to help save money in the long run.

OPPORTUNITY - Loans & Other Expenses

CONSIDERATIONS - Debt and interest can really weigh heavily on a business. This is not a line item that should be put on auto-pilot, if possible this should be consolidated and paid off as soon as possible. When it comes to other on-going expenses, continually look into options to reduce your costs where possible. Analyze your statements and make sure you’re getting benefits from everything you’re paying for.

ACTION - Don’t just sit on your debt. Speak to banks and loan providers into options for consolidation to pay down your outstanding debts as quickly as possible. Many businesses are paying for services they forgot they were using or paying for. This happens quite a lot with high turnover. Keep a very close eye on expenses and debt to help save money in the long run.

We hope this deep dive into specific marketing strategies based on your financials was helpful.

Remember to keep a close eye on financials throughout the year, as they’ll provide you with valuable insights in to the health of your business. GOOD LUCK!

COUPON COUNTINGIt may not be glamorous, but this is the simplest (yet time consuming) way to understand how your customers found you and chose you over your competitors.

ASK THE QUESTION If you have the opportunity, it sometimes doesn’t hurt to ask your customers when they arrive.

WEBSITE ANALYTICS If you offer different offerings, it may be best to monitor website page views for specific content, or using software like Hotjar that allows you to view visits of recent visitors (including scrolling, mouse movements, clicks and more).

REFERRAL URLIf you run an ad in a newspaper, it’s often a faux pas to include a long url and expect people to follow it. It’s better to use a link shortening service (something like bit.ly) or a redirect (done from your website htaccess file) that would shorten a long link and provide tracking on visits.

CUSTOM PHONE NUMBERSThere are plenty of services out there today that allow for a custom phone numbers with tracking that can be used per advertisement you run to monitor leads and performance. Look for services like Grasshopper or Callr.

WAYS TO TRACK THE EFFECTIVENESS OF ADS

STRONG COFFEE is a digital marketing & training company, based out of Edmonton, Alberta. We specialize in educating & training our clients on leveraging digital marketing strategies to reach their business goals. VISIT US AT STRONGCOFFEEMARKETING.COM

OPPORTUNITY - Decreasing Lesson Sales

CONSIDERATIONS - Lessons are usually not a huge driver of revenue; however, it is a great way to drive engagement and community at your club. By having your professionals actively working with members, they begin to develop relationships, and then talk to other members about their experience. If you can help ensure a positive community and golf environment, you will begin to see growth in lessons sales.

ACTION - Review your current lessons offerings and signage. Are members actively aware of your lesson offerings and the professionals that sell them? Are you rewarding and providing the opportunity for your professionals to provide the service?

STRATEGY ➊ Combine Lessons Into Tournament Prizing, League Prizing and even Memberships - By incorporating lessons into almost every aspect of your club culture, it gives your professionals an opportunity to showcase their skills and get involved with your members. These relationships ultimately help build the brand of your club and get your members talking.

➋ Encourage Your Professionals To Play In League events with members - Visibility here is key. If your professionals spend their time behind the pro-shop desk, it is hard for members to get to know them. A round of golf a week does the trick. Also considering adding a ‘beat the pro’ type event on league nights. Have players bet cash to beat the pros - both hit, and if the pro wins, the players gets their money back in a pro-shop credit, if the player wins, the pro-shop credit is doubled. It is a win-win and simple way to drive more sales in your pro-shop.

➌ Visibility - Some courses have separate lessons-only areas far away, from where the public and members practice and play. In some instances, this is beneficial (an example is for privacy purposes), but on the same token it does not give your professionals a chance to be seen. You would be surprised how many people like to ‘listen in’ on lessons, only to take-on some lessons for themselves in the end.

➍ Allow your professionals to build their personal brands - Your professionals need to represent themselves just as much as they represent you and your golf club. You should support and mentor them into building their own brands as what they do will ultimately help build your brands club as well. We’ve found many clubs want to ‘own’ their staff, we disagree with this approach, and don’t believe it’s conducive to a positive working environment.