What sells memberships? Course renovation/improvements or lowering the price?

[Bruce Bearer]

I would love to hear all opinions on this and would appreciate any specific examples of clubs who have successfully sold more memberships and what led to the increase in sales.  The hypothetical situation would be this:  80 year old private club, 18 holes, no pool, no tennis court, golf course is well maintained, most members like the course, but otherwise not on the radar in the area (SoCal)  Membership sales have been stagnant for past 6 years, member's getting in line to sell their memberships has been increasing for past 6 years.   

How does a club like this generate interest in the club?  I have my own thoughts and appreciate all comments.

PS - Rees Jones' website states 3 of the clubs where he has recently done renovations have sold 300 new memberships combined.

[Mike_Trenham]

Every club is in a micro market, there really is no universal answer and without seeing all of the physical assets and the comparable clubs it would be unfair to answer.

The less debt the better.

[Bruce Bearer]

Absolutely understand your comment, but if anyone has examples of how a renovation increased membership sales, please share.  I didn't mean to ask for solutions for this one club.  More looking for insight from what you guys have seen around the country. As Rees Jones stated on his website, I have to believe there are many clubs that have benefitted from investing in their course during these tough economic times. 

[RJ_Daley]

Agreed that every situation is different and a hypothetical just can't really come to any workable rule of thumb or formula.  

First, one would have to survey the members in line to leave and ask them.  Are they selling or taking a bath in this membership to upgrade to another course that has more that they want.  And then find out what it is they want.  If they want something that puts your club behind a financial 8 ball, and you can still market to a more thifty niche, then just work on quality presentation of what you have and hope to retain and gain new members that aren't so demanding.  

But, the scenario isn't too far fetched in recent economic stress years that the members trying to sell at whatever price they can get, need the money, and aren't upgrading.  Maybe like many, they decided to play muni-public golf, rather than pay this price.  I know members at nice CCs that just decided they will apply the money to playing around different courses rather than feel locked in, and thus pocket the money and usually are way ahead.  

On the question, I would personally lean towards modest facility upgrades, with eye towards uping the quality of what experience is there, without expensive brick and mortar investments in clubhouse, and hope the member are there for the golf and 19th hole pub and grub you have been providing.  In this area of WI, I am not aware of any clubs picking up members.  Some seem to be losing them, yet still uping their fees, chasing facility upgrades too far in debt, and watching their members dwindle, despite the greater investments.  

BTW, does Rees Jones sell upgrades and remodel jobs? 

[Jud_T]

I agree that it's entirely a case-by-case basis.  First I'd do a detailed analysis of the local market.  Are there other golf clubs?  At what price point?  Can the demographics support the current number of clubs?  What's missing in the local market?  High end daily fee?  Low end country clubs?  I wouldn't spend a dime until I new it was money that had a chance of being well spent.  Any number of outcomes may be most appropriate for your situation.  A small scale renovation of the course and clubhouse, a major course renovation, new ownership, different pricing structure, nothing or going public.

[Jamey Bryan]

I'd love to see Roger Wolfe chime in on this thread.  The success of Carolina Golf Club following their Kris Spence renovation is highly relevant but I don't know enough of the details to describe it fully.

Camden has successfully halted a gradual decline in membership following a renovation (also by Kris) and, hopefully, have begun to build back up.  A very small market, we're now attracting members from a wider area (especially East Columbia) who are willing to drive a little further to play a fine course with very affordable dues.  We have also invested frugally in the clubhouse facilities, but with a lot of bang for the buck.

Jamey

[Steve_ Shaffer]

The story of White Manor in the Philly 'burbs has been told here many times. Essentially, they built a new course on the existing property, lost a lot of members due to the large assessment, had the great fortune to be in an  area where waiting lists at other nearby clubs existed and regained their membership from those. By the way, their new course is outstanding.

[Tommy Williamsen]

There is no one solution to fit all clubs.  It also makes a difference whether the club is a country club or golf club.  Location has a lot to do as well.  My country club upgraded the clubhouse and pool.  Until the bust a couple of years ago it brought in many new members. 
Musgrove Mill had a significant upgrade to both the course and the clubhouse.  It didn't help at all.  It needs to market itself as a destination club.  When the cost of out of state memberships decreased we took in almost 100 new members.

[Bruce Katona]

Look at waht happens in the elections at Boca Vista Estates when Morty Seinfeld is there to keep order!!!

[Bruce Bearer]

Thank you all for your thoughts and suggestions. All very helpful and hope this discussion keeps going. 

[Jeff_Brauer]

Yes, its specific.  If your club is in Detroit area right now, I doubt there are that many memberships to sell.  You still might need to do something just to keep the folks you got.

But, history shows, low cost isn't what typically determines market share, and when it doesn, it certainly doesn't come with the loyalty that the typical club craves and needs.  So, discounting lower quality typically doesn't work out.

I don't recall the exact numbers, but I know La Costa sold many memberships (60?) after our renovation, and its picking up, probably because of the economy.  It had a bad rap for a while and some potential members wouldn't have even put it on their radar screen before the reno.  They also increased their resort play.

On the public side, after our renos, play seems to pick up from 17-25% depending on the venue.  Only partial long term data to see if that stays in place.

[Bob_Garvelink]

I think the biggest factor that affects memberships is time.  It appears to me that more and more people are working harder and more hours.  Therefore, they may feel that they wont get their money out of their membership.  I am currently considering a club that is a ways from my house and the biggest thing for me is if I will be able to use it enough in order to get my moneys worth.  Additionally, many retired folks 401K
's took a hit over the past 5 years so those extra dollars that would of been going to "extras" are no longer available.  It appears that some parts of the country are SLOWLY recovering but only time will tell if all of these courses in this country will be able to survive.

[Sean_A]

Bruce

Sometimes it may be down to luck.  I know our club is well up on visitor green fees this fall/winter simply because its far drier than practically anywhere.  It also coincided with the club dropping the winter green fee for the first time ever.  Additionally, the cub decided to market its 9 holer much more than previously.  While I don't think we are in financial straits, I think we are only 2-3 years away from that possibility - just as are a huge number of well placed clubs - so the outside income (which the club has sought out) is most welcome.  To be fair, I am not sure what else the club can do to attract more business/members than it is doing now other than perhaps fix up the loos/showers (I do hear people complain about these aspects of the house).

Ciao 

[Dan Boerger]

I would hazard "lack of other options" in X particular market sells memberships as much or more than any one benefit.

[Jeff Blume]

Bruce,

I would love to tell you that a good renovation can change the fate of a faltering club, but the fact of the matter is that it takes a multitude of factors all coming together to make a success story.  We did a renovation at a club called Golfcrest southeast of Houston in 2007 that might give you some insight.  The club is an equity membership who's numbers were dimishing when the renovation was approved.  Upon approval, 120 members quit because they didn't support the project.  Those who remained saw the renovation through, and it was the catalyst that sparked a revival in the club's membership rolls.  At the low point in 2007, the club had only 230 stock holding members.  Today they have over 370 and are less than 30 from having a waiting list. 

Along with the renovation, the management of the club was changed, and the focus of the new management entity was to concentrate on course conditioning and member service.  The maintenance budget of the club was $490,000 in 2006 and it has increased to approximately $785,000 today.  The course is known to have some of the best putting surfaces in the Houston marketplace, and the service in the clubhouse and proshop is impecable.  These factors have had as much influence on the success story of Golfcrest as the renovation did.

If you would like to speak to the people who helped to bring about this change, then send me a private e-mail and I will put you in touch with them.

[Dominic Meese]

My club in recent years has had an average member age of somewhere near 60. in order to attract new, younger members they halved the joining fee for people under 40 years old. They also reduced annual subs based on age brackets up to 40.

These two things sold the membership for me and there has been an influx of new, young members in the past two years.

But, as others have stated, every situation is different.

[Jud_T]

Jeff,

Congrats.  Not clear that increasing the maintenance budget by 60% is the answer in this situation.  However, I do think focusing what $$'s you do have as efficiently as possible on the golf course and not wasting it on the house and any other extraneous stuff is generally the right thing to do.

[Jeff Blume]

Jud,

Actually, the increase in the maintenance budget was partially a reflection of the increase in the membership.  I believe the new operators increased the budget to $600,000 initially, but the additional growth correlated to the membership growth.  I think their big key was staying committed to their management program.

[Dan Byrnes]

From what I can tell the country club is a dying business.  The demographics are generally against all clubs.  There are specific locations of populations density and wealth that can buck this trend maybe indefinitely but it's basically a dying business.  There certainly are exceptions of strong clubs with waiting list that are growing but the vast majority of areas have clubs in trouble.

Dan

[Mike_Young]

The key to selling memberships is offering a fair price for a well maintained product that is playable.  So many of the last few years "improvements" have created "restorations" that just can't be played or either the game can't be learned on them.  Our home course went from 110 members to 780 after a 3.5 million renovation.  the older members can't play it and can't get in and out of the bunkers.  The average age is still 58 so that means no 30 year olds are joining.  Give people a good experience where their families can learn to play and they will come.

[cary lichtenstein]

The bears club dropped from $350,000 (50% equity) to $90,000 and that is working

Admirals Cove spent $14 million on new pools, eating facilities, new gym, card rooms, etc and that is working

Big difference between programs for golf clubs and full service community clubs. The latter have gone to casual dining, major workout facilities, more of a family resort feeling but that works only at the high end with mandatory memberships

[Jerry Kluger]

What I have seen in the last 10 years is a really small number of public course golfers joining private clubs. Years ago public golfers aspired to private memberships and when the price dropped they joined.  Now they are public golfers not only because of cost but because they don't want to commit to the amount of golf they will have to play to justify the expense.  If you make significant improvements to a course I think you will attract members from other private clubs but I don't think you will see public course golfers joining just because the course may be better.  To attract members I think you need an overall package where they will feel they and their families will be using the facilities but if it is only a golf course then it becomes purely a financial issue.