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February 2020

Trust Your Gut?


By Jared Williams
Managing Director 

I have been thinking a good bit recently about the value of a round of golf. Last month’s column discussed how tee times (specifically when bartered) equate to real dollar value amounts. In that same vein, I have been wondering how course operators are coming up with the perceived value of their facility.

What is the starting point for determining when to increase or decrease rates? Is the market or demand for golf influencing the change in rates? Have ameliorative changes to your facility provided justification for a rate increase? Are there events and developments in your local market that require you to dynamically price your tee sheet in ways that result in rate increase at random times of the day and days of the week?

In any event, the thing I really find myself asking: What method are you using to find the “sweet spot” on a rate or deal? Is it gut instinct or science? Do you analyze the conversion rate on tee times at the listed rack rate as opposed to twilight or any other promotions that may be advertised?

Yet, even for the GolfNows of the world, which use algorithms to find the exact dollar amount or discount percentage that is likely to influence a purchasing decision, what can be deduced from that science?

Is the golfer in love with the course or the rate? Would the golfer have booked a round at the course for that particular day regardless of the advertised discount? Does a $5, $10 or $20 difference in price have a drastic impact on the conversion rate and ultimate filling of the tee sheet? To paraphrase Whitney Houston’s 1985 single, as a golf course, “how will I know” if my golfers really love my course as opposed to the rate?

Generally, most courses offer a twilight rate on tee times. This usually starts at some point in the afternoon and all rates after this time are discounted by the course. Twilight is one way that the golf course can institute its own rates, but traditional twilight is not analogous to the barter times offered by a GolfNow. What is, however, more analogous to barter times offered by online tee time agents are the midday twilight times that some courses apply. These midday twilight times are discounted rates authorized directly by the course, sold on the course’s website and sandwiched in between rack rate tee times. Whereas traditional twilight has no rack rate tee times available after twilight starts, midday twilight allows rack rate tee times to be listed before and after the midday twilight window.

The midday twilight may be an option for courses that see a lull in demand on a consistent basis during a specific time window of the tee sheet (e.g. weekdays at 12 p.m.)

GolfNow might sell your 11:40 tee time as a discounted barter round and your 11:30 and 11:50 tee times are offered at rack rate. A course could employ the same tactic using midday twilight.
The real question is how much of a discount is necessary to influence a golfer to purchase the discounted time as opposed to the rack rate time? Could a nominal discount of $5 improve the conversion rate? Is the industry over-discounting?

I’m really interested in hearing what different operators are doing to set their rates. For those at public facilities, are you picking a number out of the sky using your gut instinct? Are you looking at data from past years? Have you made it a scientific process and incorporated algorithms? Have conversion rates been considered? Share your thoughts.


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March 2020 Issue

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