The PGA screwed this one...

[Mike_Young]

This is one reason I have such issues with the golf associations.  Are they just stupid?  Or do they really think this way?
http://www.nxtbook.com/nxtbooks/pellucid/perspective_201202/  read pages 2,4,5 and 19
AND I'M NOT TALKING ABOUT THE INDIVIDUAL MEMBERS...they have to be the ones to get these association people corrected...

[Tim Nugent]

Mike, is your problem with the concept of third party sales or with PGA's way of handling the PR?

I don't see how tee times are any different than hotel rooms or airline seats.  They are all time sensitive.  You can't put unsold times into inventory for a later date.

[Jim_Kennedy]

Mike,

A stupid, greedy, and thoughtless plan.

[Mark Saltzman]

Mike, is your problem with this plan your belief that GolfNow is a contributor in the race to the bottom where golf courses compete with each other to give such large discounts that they all lose money?

[Mike_Young]

Mike, is your problem with the concept of third party sales or with PGA's way of handling the PR?

I don't see how tee times are any different than hotel rooms or airline seats.  They are all time sensitive.  You can't put unsold times into inventory for a later date.

TIM,
I have been watching this for a while now and it is not the same as the hotel industry.  This is a barter whereby the owner gives GolfNow a foursome each day to sell as they wish basically.  The hotels have a rate and it is not barter.  This third party tee time stuff is dangerous and as Mark says it creates a race to the bottom with no risk on their behalf and with the organization that your pro belongs to profiting from your business.  Golf Now is not good for golf.  IMHO

[Mark Saltzman]

Mike,

My thoughts as a guy that is not in the industry. I use Golfnow. Most of my friends use golfnow. I have played many rounds at expensive courses I probably would never have played if not for substantial discounts on Golfnow (a couple examples are Biltmore which is $160 rack and I paid $55 and Crandon which is $170 rack and I paid $70). I have no idea if this is good or bad for the industry. Neither course was busy (they were mid-week noon-ish tee-times) and in both cases the foursome was filled. If the entirety of the revenue from that tee-time went to Golfnow, than there is little benefit to the courses, other than the bit of money I spent in the golf shop and the restaurant.

I think the biggest problem is that I now expect discounts at public courses. Somehow it feels wrong to pay rack at a course when I could play another course of equal quality for half price. Even a course like West Palm Muni which is only $50 incl. cart at prime time, I wouldn't pay full price because I know they have discount times on GN and EZlinks. Maybe I'm cheap (though I don't think I am), but I think I am just being a rational consumer and there are many people like me. Perhaps GN takes too great a percentage of the revenue but could it be that the GN price more accurately reflects the correct price of green fees at courses if they want to be busy?

[Jim_Kennedy]

Mike,
The GolfNow idea is not a bad one, if the operator knows the course and sees that he has little play at certain times he can get those rounds sold online. Some courses who use GolfNow offer the same discounts to people who sign up for "specials" at the club's website, and in both cases the number of rounds available is limited by the club.  Guys I know who take advantage of the GolfNow or "specials" times do so at courses they might not otherwise play because of the cost. It also draws people into playing courses that are outside of their normal travel range.

The PGA is thoughtless and stupid in its quest for a piece of the pie because of the potential of putting its members in a very awkward position with their employers.

[Mike_Young]

Jim,
If it worked just as you describe it could be acceptable at times but the problem we find at my place is that GolfNow might sel that time they have or give it away at almost nothing and then the people that got it start wanting to come back and sit and negotiate a green fee.  I used it for six months and had more problems than it was worth.  I would rather have 15000 rounds at 50 dollars than 30,000 at $25.  JMO

[D_Malley]

I find this topic to be very interesting and have also been following this trend for several years now.  I manage a very busy public course in a metro area.  I have made the decision not to partner with Golf Now.  I probably get phone calls from GN reps about once every month wanting to meet with me. I have had to recently get very abrupt with them on the phone and had to ask them to stop calling me until they change their business model.  Why would I want to meet with you to turn down the same offer i already turned down before.

I guess if my course was not as busy it would be harder to refuse GN.

[Jim_Kennedy]

Mike,
We don't use it, we're inexpensive to begin with, but we do let the local chapter of the Lung Association include us in their golf savings card.

If you look at the listings you might see ten or twenty tee slots available at a course for a given day. Once the buyer pays for it he either uses it or loses it, rain (unless the course closes) or shine. It's money in the bank if the course chooses wisely in its selection of times, and to make up some of the 'loss' one operator I know who uses GN makes the group aware that he will only charge them the standard cart fee if they want to play again (9 or 18 ), and he gives them a 10% discount on food in the restaurant, too boot, so most of the times he sells are early in the morning, around 11:30am, or late in the afternoon.

I think the best way to handle negotiators, those who use GolfNow, is to turn the discount into a plus. Sell them on the idea that the times you are offering online are times when the course is less crowded, and playing at that time will give them a more relaxed and pleasant day.  
If they look out the shop window in a supposedly 'busy' time and see an uncrowded course they may counter with " 'tain't busy now",  in which case you can offer them a one-time 10% food discount or a plug of chaw.  

 

  

[Jon Wiggett]

Interesting article spoiled by incorrect terminology. The PGA is based in the UK but this seemed to be concerning the USPGA. It amazes me that they would even consider such a scheme as the reaction it caused should have been obvious.

Jon

[Tim Nugent]

Perhaps, this just isn't the 'one size fits all' model some think it should be.  Let me explain.  If I were a high-end course, I would see this as a short-term revenue source that could probably erode my brand.  If I were a value operation to begin with, I'll only be getting people who are even more frugal than my regulars. If I am a middle of the road, the revenue might be worth it.

I have always thought that discounting was a death spiral.  Once you start, you can't go back. It becomes an entitlement.

As many have said, 'it allowed me to play a course I couldn't otherwise afford'.  Doesn't this mean that you probably won't be back without an inducement?

And, this is only taking business away from another facility. It isn't growing the game, just canabalizing it.

Mike, I'm not sure I follow how this Barter system works.

[Jim_Kennedy]

Tim,
I'd say you have it right as it's mostly middle-of-the-road courses using Golfnow. Occasionally an upper tier course appears, but again, they're only selling a small number of times. I don't think it's a bad idea if discounting a few tee times during a traditionally slow period at a high-end course entices someone  that otherwise can't afford it. You've filled a tee time and have money in your pocket from a person that you're not going to get any other way.
We 'discount' rounds every time we sell a season pass, that's a common practice, and while I mostly agree that Golfnow isn't growing the game, I don't think it's totally cannabalistic. If a season pass holder from our course uses Golfnow to play somewhere else we 'make' more per round from him and the other course picks up some revenue.        

What I think Mike is saying is that the tee time that Golfnow gets in 'barter' can end up being sold for less than the other times the course gives up, as shown by the one I circled in red. It doesn't seem proper.
 

[Greg Tallman]

As a high end destination resort how could I justify using this product? What number of regular rate GolfNow reservaitons do I have to get to assume it was worthwhile? Given that these folks were hopping on a plane to go to a foreign country to play golf should I not assume I was getting these rounds regardless and anything given to barter is 100% lost revenue?

My only way of gauging any return is through the e-blast program five times per year to target markets. At that a some form of "special" would have to be offered for tracking purposes. 

Someone please tell me how I am wrong.

BTW - Just went through their presentation and all other facilities in the area will be sigining on. I see it as almost a pure donation.

[Mike_Young]

I sincerely believe that if third party tee time providers are allowed to prevail it will not be good for golf.  It makes golf more of a commodity than it already is.  And these guys have no risk in the game.  It becomes a race to the bottom.

[Kris Shreiner]

Mike,

Agreed...VERY dangerous. At least they retracted after getting blasted from all angles by their membership.

Cheers,
Kris

[Jim_Kennedy]

Mike,
Where were you 10 years ago when the third party tee time providers began? I have no interest at all in selling tee times through such providers, but it's been estimated that around 47.5 million rounds were booked online last year, that upwards of 45% of US publics use third-party resellers, and that something less than 1% of all tee-time web bookings are bartered.

There are companies who use the barter system but do not advertise the bartered tee times on their publicly viewed sites. They only offer them to closed subscriber groups.   

Greg,
There's something going on if all your competitors are using the service.

[Mike_Young]

Mike,
Where were you 10 years ago when the third party tee time providers began? I have no interest at all in selling tee times through such providers, but it's been estimated that around 47.5 million rounds were booked online last year, that upwards of 45% of US publics use third-party resellers, and that something less than 1% of all tee-time web bookings are bartered.

There are companies who use the barter system but do not advertise the bartered tee times on their publicly viewed sites. They only offer them to closed subscriber groups.   

Greg,
There's something going on if all your competitors are using the service.

Jim,
I been watching the entire time and have tried them once or twice.  As you say, 47.5 million rounds were booked online last year.  I look at it this way.  Those 47.5 rounds would have been played anyway at some place.  Eventually there may be a way to do it( maybe something like Open Table for restaurants) but right now it isn't there IMHO. 

[Jim_Kennedy]

Mike,
If you want to offer online reservations you either hook up with someone like FORE!,  buy a few thousand dollars of their software, sign a lease with them, and then offer the service on your own course's website. Of course, your potential sales are limited by the traffic your site generates.
Or, you hook up with a company like Golfnow, barter away a tee-time a day, and have your course featured at a site with thousands upon thousands of visitors.
All it takes is a couple of months of vigilance on the club's part to keep track of how many of the rounds they've listed on Golfnow (or any other third-party site) are being sold vs. how many of the bartered rounds they've given Golfnow are being sold. If the ratio makes you happy you continue, if it doesn't you stop.

p.s I've viewed some of the offers on the GN site and compared them to offers that the same club has on their own site. I found many cases where the offers were the same, some where the club's own offering was slightly higher than what they are giving GN, and some cases where the GN offering was a lot lower than the 'special' rates posted at the club's site.  

[Mike_Young]

Jim,
I understand your reasoning but my concern is what happens when they reach a critical mass.  That's what they are after.  And the PGA was going to help them.  The GN isn't like a hotel site where there is price parity.  IMHO they just can obtain critical mass or we have a problem.

[Joe_Tucholski]

I find this subject interesting.  There are some things that I don't understand.

1)  What influence will the US PGA have in twisting arms for new courses to join the proposed online system?  Individual PGA members would not be required to join as a condition of membership right?
2)  I couldn't find real info about the current contract conditions for courses that participate.  Could someone summarize the contracts?  In the business model forecasts in the attached link I have to be misunderstanding something because 35% revenue share of all tee times booked is ridiculous right?  Are they talking about the one barter tee time?

I have to agree with Mike’s original statement.  If my professional organizations entered into an agreement which was economically beneficial to the organization but detrimental to the individual members I would be pretty upset.

The following is the GolfNow process as I understand it.  Please correct whatever is incorrect.

In order for a course to have tee times listed on the GolfNow website they must give GolfNow one tee time a day (refered to as the barter?) that GolfNow can sell at any price they see fit.  I have no idea how the time for this barter tee time is determined.  I assume as Jim highlights these times are the ones that are sold as "Hot Deals" and require full payment at booking and 100% of the money goes directly to GolfNow.  The course can then list other tee times on GolfNow as they see fit and the course has control over the pricing for these times and the golfer pays the course when they show up for their time.  As I understand it GolfNow makes money on these tee times by charging a $1.99 transaction fee.

If we look at the example Jim put up I agree it is less than ideal but part of that is because public golf in PA is a way better deal than it is here in LA. 

When I look at the example Jim put up if the course is not selling tee times between 930 and 12 doesn't it make sense to discount the prices (or raise the prices before 930)?  I'm usually a twilight golfer and regularly observed an hour before twilight no one is teeing off.  In my mind it would make sense for public courses where this scenario occurs to have a mid day rate between the morning rate and twilight rate. 

The discounted barter time at 1239 Jim points out is crap and I would not enter a contract with GolfNow if this was part of the deal, that being said as Jim pointed out you potentially lose out on visibility. 

If I’m traveling after searching this site for recommendations I use GolfNow to see what courses charge what prices.  I’ll also check the websites of courses not on GolfNow that are mentioned on this site but I would guess there are many who use GolfNow as their primary booking tool when traveling.  I usually book directly with the course because I typically find the prices to be the same for the times I want to play (last year I booked 4 rounds on GolfNow).

[Mike Nuzzo]

Joe

1)  It is in some PGA Pros interest to have the PGA earn money as they are compensated in some manner by the PGA.  It isn't always in the owner's best interest.
Find Mike's thread about Titleist.

i.e. an employee flies Continental to get the frequent flier miles even when Southwest is cheaper.

[Jim_Kennedy]

Joe,
Mike Nuzzo's explanation of the potential problem is correct as it pertains to the PGA and its members. The remaining issue with third party tee time providers is mostly about perception, i.e, you either feel that using this type of service will ruin your brand by discounting and that no one will ever again pay retail at your course, or you feel that they serve a purpose that can be beneficial to you if you know how to tailor it to your needs.

[Kris Shreiner]

Guys,

I think some of us are looking past Mike's MAJOR concerns. They are: the wholesale model of "discounting" as major platform, being aided and co-sponsored by an organization that claims to be dedicated to be looking out for the health and welfare of the membership AND, here's the big point ...the GAME!

Running any golf facility IS NOT cheap...period. While there are different levels of presentation, with varying pricepoints, significant, consistent discounting on a industry-wide scale eventually (quite rapidly for some) leads to the demise of numerous facilities and still poorer presentations of the survivors,  a few elite facilities excepted.

How is this good for the game? Certainly there needs to be some facility contraction, as there are simply too many operations out there that can't be supported properly by today's stagnent or shrinking number of golfers. While supply and demand always is at play in any business-related endeavor, providing vehicles to accelerate the financial spiral and pain hardly seems like a winner to endorse or sponsor.

Let's hope this platform gets the good, hard look it deserves, so a model that truely better serves the fiscal health of facilities AND the game can emerge. It's not the medium that the problem, it's the unsustainable discounting, with complicity by those that should know better...that seems to be the problem.

Chers,
Kris

[Mark Johnson]

Lots to say here since this is one topic on this board that I tend to know alot about.

For a quick summary, online booking sites tend to be very bad for the industry, however, given that so many people are on them, any course with regular open capacity can't afford NOT to be on the site.

As a result of golfnow (and other sites like it),  there has been an explosion for the number of golfers looking for a perceived deals.   As a result, any course who choose not to be on this site will be at a major competitive disadvantage.   So joining this site basically becomes a cost of entry.  As a result, all of the fees paid to Golfnow, now come out of the industry and are not reinvested into the courses.

For a point of comparison, a very similar phenomenon has occured with open table on the restuarant industry.   Here is a great article on the impact to restaurants. http://incanto.biz/2010/10/22/is-opentable-worth-it/]Open Table Article [url] http://incanto.biz/2010/10/22/is-opentable-worth-it/[/url]

What is most unfortuante is why the sites came into existance in the first place--   Almost every muni golf course I have ever seen has a HORRIBLE pricing policy.    Weekend rounds are priced too low and midweek rounds are priced too high.   That is what enabled this phenomenom in the first place and drove way too much open capacity.   As the economy has slowed down and rounds have declined, capacity grew and these sites became even more powerful.