I wrote yesterday that public golf courses would do well to avoid their initial instincts to cut prices and, instead, try some creative approaches to inspire customer loyalty.  Today, I stumbled upon a golf club’s web site whose creativity may have inspired Tiger Woods.

        Las Vegas area golf course Rio Secco hosted the 2009 Wendy’s Three Tour Challenge in November.  The Wendy’s pits teams of pros from the PGA, LPGA and Senior PGA Tours against each other.  The tournament was broadcast on TV this past weekend, and the ladies team of Natalie Gulbis, Suzann Pettersen and Cristie Kerr beat the men’s teams.

        That was only one example of how friendly Rio Secco is to women (the LPGA team has won there before).  A Rio Secco caddy program,

called T-Mates, has been a course mainstay for more than two years.  For about $200, more than the club’s green fee rate most times of the year, a golfer can sign up for a female caddy for the round, most of them supplied by local modeling agencies.  According to the Rio Secco web site, the caddy performs all customary caddy duties and even calls in her golfer's food order at the turn and hangs out with the customer for after-round drinks in the clubhouse.  That all adds up to about $40 per hour, a bargain by Las Vegas escort pricing standards.

        The Rees Jones designed Rio Secco, which is also host to the Butch Harmon Golf School, is apparently a favorite of Tiger Woods.  The club was the site earlier this year of the Tiger Jam, a charity tournament for the Tiger Woods Foundation.  Woods is the host of the annual event, which attracts such celebrities as Charles Barkley, Pamela Anderson and Eddie van Halen and has raised more than $11 million for the foundation and Vegas area charities since its inception in 1998.  Woods showed up for the 2008 event on crutches while nursing his injured knee and before his legendary win at the U.S. Open later that summer.

         It should come as little surprise that Woods holds the course record at Rio Secco with a 64, a feat he accomplished in 2007.  That was the year Rio Secco debuted its T-Mates idea and, we now know from news reports, a year in which Tiger may have been setting off course records as well.  One of his alleged mistresses, Jamie Jungers, is a Las Vegas model, cocktail waitress and caddy.  (The web site CaddyChicks.com features Ms. Jungers, indicating she is "Tiger's favorite caddy.")  As a female Vegas caddy, she very likely has trod the fairways at Rio Secco and may just have inspired Woods’ record round.  But also in 2007, Ms. Jungers has told interviewers, Woods dropped her when she mentioned her financial difficulties to him.  She also said he never paid for meals or tipped servers while the two dated. 

        In some things, apparently, he showed a lot of control.

Rio Secco scorecard, which notes Woods' record round, hole by hole.

        As private golf club fees become out of reach for more and more baby boomers and younger working families, dedicated golfers are looking to public golf courses for bargains.  They won’t have to look far, based on what I encountered during eight weeks driving around New England recently.  My discussions were a real opener about the state of the daily-fee golf business.

        Most of the public-accessible courses I visited and most of the golf course operators I spoke with

believe that discounting is the path to near-term survival; they aren’t even thinking about the long term.  I met one veteran pro who was proud of his 30 different discount rates, and another general manager who explained that she depends substantially on discount coupons.  The sign on the wall behind her stated just one standard green fee rate, plus one discount for play in the afternoon.  Yet in magazines and online, you can clip her advertised coupons and redeem them at the course for 20% to 50% off.  The GM proudly indicated the more than half-dozen buttons on the cash register that make it easier for employees to log in the proper discount, the way they do it at McDonalds, but without the pictures on the buttons.

        This single-minded drive to poach on their own published rates, including the ubiquitous use of online tee times, is blinding some golf course operators to more creative avenues of promotion, some of them free for the asking.  And it is angering many of their competitors who see rabid discounting as a slippery slope toward cementing customer expectations about price for the long term.  These club owners would prefer to increase service to their customers instead of gutting their price structures, discounting a little only as rewards for customers who sign up for their loyalty programs.

New Hampshire's Candia Woods Golf Club has chosen to invest in customer loyalty.  Its discounts are reserved for those who sign up for the club's "Preferred Player" card.

 

        I found a strong amount of ennui among many of those course operators I spoke with, as if the current economy was beating them down.  They acknowledge, when pressed, that competition for golf rounds in the current environment is intense, but only a few had any response except to cut prices.   Perhaps age has something to do with it; I estimate 90% of the golf course operators and marketing directors I met were either under the age of 35 or over the age of 50.  Some seemed barely out of college, and nothing has prepared them for the current economy.  Those whose instinct may tell them that gutting their price structures may not be the right thing to do responded to my questions with, “That’s what my owners want.”  The blind leading the inexperienced is not a winning combination.

        More experienced golf professionals just seem tired and not particularly energetic about creative approaches to a falloff in business.  Everyone is hurting, but those who have concentrated more on loyalty programs than price-cutting appear to be doing okay.  Clubs like New Hampshire’s Candia Woods and its companion course, The Oaks, for example, have built a large database of golfers’ email addresses that the courses use to promote last-minute specials, a “Preferred Players Club” that provides a 10% discount (their only discount), and even email reports that alert golfers to good weather a day or two out.  Owner Peter Harrity, who contributes an opinion piece at the club’s web site, has been through enough industry downturns to know that short-term fixes like rabid discounting can have long-term negative consequences.  He is also promoting hard more golf outings and events like weddings to fill the gap in lost revenues from green fees.

        Some simple math:  A 50% discount on $50 green fees amounts to a loss of $100 per foursome.  At an average seven tee times per hour, and about seven hours per day to send out foursomes, the big discounters risk

a loss of up to $5,000 on a busy day.  Although that may seem an extreme example, preserving a fraction of that by holding off on discounts could pay for a lot of innovative touches and quality improvements.

        There are tons of creative ideas golf courses might try before they take the discounting plunge.  Here's one I would consider if I owned a course that saw the benefits of building customer and brand loyalty:  Set up a table behind the 18^th green and greet all incoming golfers with a glass of champagne and hors d’oeuvres.  Such a club will generate local and possibly national press, and will build a reputation for caring about its patrons.  Such loyalty to customers builds repeat business and will help avoid the slippery slope of discounts.