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Don_Mahaffey

Hit or Miss
« on: February 05, 2013, 09:22:09 PM »
In the entertainment industry, it has always been about the hits. Box office hits, album sales, ticket sales, best sellers, always striving to have a hit. But now, we have the internet, iTunes and Amazon, and I read that it has never been better to be an unknown. Music, words or video take up very little space on a server, low cost to house, easy to share. While still great to be famous, to be a hit, to make a fortune, with most of the bottle necks to exposure and distribution gone, it no longer means offerings are limited to 4000 CDs at a brick and mortar store. An online seller might have 400,000 titles, and guess what, even #400,000 sells, a little at least. And so does #399,999 & #399,998.  Our mass market has become a market of niches.

Has any of that thinking hit golf? I don’t think so, but I think it should. I was talking to a friend today and said all he really needed was 1000 people who wanted to play his course. I think that 1000 people exist as he has a very nice niche to fill. In golf we’re mostly still all about the hits, the rankings, the big names. While we all know the big names, I’m guessing that for every golfer who plays Bandon, Streamsong, or Sand Hills, there are 1000s playing somewhere most have never heard of.
 
I believe a huge niche exists for those who are willing to forgo fame and fortune and just make a living. Maybe you’ll have a hit, maybe not, but wouldn’t it be cool if more in golf adopted the same attitude as the guy who has the 200,000th rank song, or the author who isn’t on any best selling lists, but has found a way to make a living?

 

Shaun Feidt

Re: Hit or Miss
« Reply #1 on: February 05, 2013, 09:31:05 PM »
I think this does happen in golf.  For every exclusive private club or $300 a round high end public, there is 10 $30 a round public courses that have people making there living and serving the lesser privileged golfer.  But more than likely, you are not going to hear about it on this website.

Peter Pallotta

Re: Hit or Miss
« Reply #2 on: February 05, 2013, 09:42:24 PM »
Don - Bingo! Again. (You're on a great run of threads). An old friend of mine had a radio show on the public network. She told me about the strange experience she had there. When we were much younger, we both used to lament that some great 'indie' bands we liked didn't have contracts with record labels and thus weren't getting their music out there; and we'd bemoan the industry and lack of opportunities for such interesting bands. But jump ahead 20 years, and now she had a national radio show, and every young band with a lap top could produce a high quality demo/cd and send it to her (in hopes that she'd listen and like and maybe play a song, or mention the band on air). Well, it broke her heart to do so, but she soon found she had to put the cds directly into the trash -- because she was getting 500 or so every single week, sent in from all across the country; the trouble was, ironically, that now there was no no filter, no 'industry' to act as middle men in the same way as before. On the other hand, those bands had new and exciting modes of distribution -- and some were able to take great advantage and 'make a living' as musicians in a way previous generations never thought possible. It IS possible - for architects and musicians and writers etc...but I think one of the hard parts is actually having the modesty (or whatever it is, maybe grace) to be satisfied with 'just making a living'. So many of us, for so much of the time, desire so much more than that; we just don't admit it.
« Last Edit: February 05, 2013, 09:53:43 PM by PPallotta »

Bill_McBride

  • Karma: +0/-0
Re: Hit or Miss
« Reply #3 on: February 05, 2013, 09:51:07 PM »
Mike Young agrees with you.  He's all about mom and pop courses with small budgets being the future of modern golf.  I really hope Longshadow is back in business soon as the examplar.   

RJ_Daley

  • Karma: +0/-0
Re: Hit or Miss
« Reply #4 on: February 05, 2013, 10:10:57 PM »
Don, I think you're really on a roll lately, by starting some interesting threads.  At least I've been enjoying them.  So..

maybe one way of looking at your posit is that if there are 20,000 golf courses in this country, and each had 1000 niche golfers as members of the club, or regulars at a public course, all of whom meet the ideal definition of a regular golfer, then that would yield 20,000,000 regular golfers.  

By regular golfers, that would be those that on average play once a week or more (perhaps up to 3-4X a week - what are the NGF numbers?).  So, lets go the lowest and say 1X a week.  Then average that half those 20,000 courses on average stay open 3/4 of a year on average.  So, just call it 15,000 courses.  Now, take 20,000,000 golfer x 52 rounds a year,isn''t that about 1,040,000,000 rounds a year.  Lets say that is about $40 average cost of a round, factor private club dues and daily green fees, and that is 41,600,000,000 genrated in green fees.  And, I suspect my average estimates are generally low and conservative to actual number of courses, average actual cost per round considering private dues and public daily green fees, etc.  

So, pretty soon we are talking about some real money....  ;D  Now, if you add in the concept of winners and loosers, and who garners the most regular golfers, and who has a niche core of 1000 regular golfers, and pretty soon you gotta figure, there still must be some marketting opportunities for a smart savvy operator to use these new mass media reaching marketing tools of internet and digital media to prospect for a niche and grow the niche you have, even in a more remote locale.  

They always say that any community should be able to support golf courses if the ratio is about 1 course for every 10,000 population.

So, if an operator is very sharp, and gets away from costly traditionsl advertising print and radio-TV marketing, and finds a way to utilize a mass e-mail list, and has a very easy to access and use website of the course facility that has great photo and video sizzle, maybe even entertains the viewer with some sort of interactive game or activity that is facility specific, and is a price leader who gives a good experience at a reasonable price, then the niche operator should be able to cultivate and flourish.  Of course it boils down to if the investment was unrealistic to the market.  How much did the facility cost to acquire and operate.  If you go beyond the comfort or interest level of the niche customer, including exceed the concept of local expectation of good value, and you can't generate the often elusive ideal of exclusivity and become the choice of the haughty merely on price to enter and play within the niche, well there is only the 1-2% crowd that will buy into that, and way too many portential market that don't have those tolerances or values.  

I don't know how many times when I used to contemplate developing a course that I didn't go through these mental gymnastics.  And, because deep down, I didn't have the confidence that I truly knew what I was getting into on a practical level, from prior industry experence, I kept getting to the brink and never pulled the trigger.  I always figured or conjured up an argument that said, too much risk to develope that niche, and too many broke start-ups that were reality checks.  Hell, even my favorite Wild Horse has a bit of a price aversion reaction to locals at ~$40, and if you don't take advantage of the yearly membership, the cost is over many locals heads.  I guess being risk adverse and very cautious is why I could never be the next Mike Kaiser, Ran Morrisett or Ben Cowan-Dewar, on soooo many levels!   ::) ;) ;D

However, I'd bet on you or a Joe Hancock type as gents far more likely to succeed as such due to both your vast experience.  Oh yeah, and tic toc, the sound of the biological clock, is always there to haunt you... ::) ;D
No actual golf rounds were ruined or delayed, nor golf rules broken, in the taking of any photographs that may be displayed by the above forum user.

Chris Johnston

  • Karma: +0/-0
Re: Hit or Miss
« Reply #5 on: February 05, 2013, 11:04:14 PM »
Don

Great post!

It takes passion, energy, and real commitment to be in the business these days.  The past was a rich man's game with real estate and easy money.  The present is nickles and dimes, sweat and fun.

There are probably spots where the "excitement" game is alive and well, but we don't pay much attention to it out our way.  The "meat" of the market, be it public or private, is value oriented - the people are out there but they have to see value and your commitment...your commitment to them.

I, too, have really enjoyed your recent posts and agree overspending is a ticket to failure.  I'm fortunate you were part of our team on the new course and fully agree the past is a window into the future.

"If you build it, they will come".  If the experience really is fun and the value really is there, good people will join you and be committed, with you, to the effort.  It has to mean something these days.

Jim_Kennedy

  • Karma: +0/-0
Re: Hit or Miss
« Reply #6 on: February 05, 2013, 11:32:25 PM »
That would stand to reason. Even if the top 200 courses in the USA each had 30,000 rounds played on the them the other 15,000+  courses account for the remaining 450 million rounds.  

And I have to believe that a goodly number of those 15,000 courses were built by people who aren't famous.

Hell, I just read the ASGCA's list of architects and there sure are a lot of names on it that aren't household words, at least to me.
"I never beat a well man in my life" - Harry Vardon

David Harshbarger

  • Karma: +0/-0
Re: Hit or Miss
« Reply #7 on: February 05, 2013, 11:33:47 PM »
Don,

You have succinctly stated Chris Anderson's 2004 theory of the Long Tail.

The digital Long Tail combines 1) Very Low Production and Distribution Cost, 2) digital distribution, so that physical proximity to a distribution outlet is not a factor 3) Effectively infinite shelf space to stock product and 4). Effective search so you can find what you want from an infinite selection.

The benefit is that the 400,000th course can cost-effectively be sold to the geographically dispersed market for its unique characteristics, if in fact golf courses were digital goods.

The problem: Golf remains a brick and mortar product, consumed in the physical world.  While there may be 1,000 customers world-wide, by interest, for some sand-green course in Western Nebraska, it costs too much to get them together to create an effective market.  For most courses, proximity becomes the dominant market constraint.

(Compared to other posters this looks like a Debbie Downer. Sorry, I just see the Short Head being the local muni, private club, privately owned public, etc., that live and die based on local play.  Sure, hard work and vision separates the offerings in a local market, but for 99.99999% of the world, every local mom and pop has 0 market appeal no matter how hard or creative they are.)

On the other hand, maybe I'm not thinking about this creatively enough, as far as how a local mom and pop could build a broader support base through effective channel and marketing strategies......

If anything, Bandon is the course that proved there is a long-er tail for golf courses by standing up a product that had enough appeal to a geographically dispersed clientele to define a golf-only destination niche.  However, in another sense it represents another point in the resort golf market that pushed the elasticity of proximity throughout golf history.

Dave
The trouble with modern equipment and distance—and I don't see anyone pointing this out—is that it robs from the player's experience. - Mickey Wright

Tom_Doak

  • Karma: +1/-1
Re: Hit or Miss
« Reply #8 on: February 06, 2013, 01:44:10 AM »
Don's theory works just fine in the UK market.  There are a ton of good courses there which exist through a combination of affordable memberships for the locals, combined with enough appeal to traveling golfers to get them over the hump.  In the UK, though, "remote" is not really so remote; nearly every course is within a half day's drive of the big cities, so as David would say, the distribution of the product is actually quite good.

The theory worked just fine in the Myrtle Beach market, too.  They managed to put together a strong enough marketing program to get a lot of people to visit the area, everyone stayed in basically the same place, and any course with a bit of sizzle was able to attract its fair share of the visitors.  Worked just fine until they started building more expensive courses, and too many of them.

For most U.S. markets, though, it hasn't worked well at all.  Many of the best courses are private, and even the public courses on the east coast (where more of the people are) have plenty of restrictions to favor local play.  In effect, those courses are all taken off the market; and because they don't participate, people aren't drawn to the area, and the second-tier local courses don't have easy pickings of the spin-off market from the big-name places.  Part of what makes golf in Scotland work so well is that Muirfield brings in visitors who then stay to play all the other East Lothian courses; Pine Valley doesn't do the same thing for southern New Jersey.

Don_Mahaffey

Re: Hit or Miss
« Reply #9 on: February 06, 2013, 08:13:43 AM »
Don

Great post!

It takes passion, energy, and real commitment to be in the business these days.  The past was a rich man's game with real estate and easy money.  The present is nickles and dimes, sweat and fun.

There are probably spots where the "excitement" game is alive and well, but we don't pay much attention to it out our way.  The "meat" of the market, be it public or private, is value oriented - the people are out there but they have to see value and your commitment...your commitment to them.

I, too, have really enjoyed your recent posts and agree overspending is a ticket to failure.  I'm fortunate you were part of our team on the new course and fully agree the past is a window into the future.

"If you build it, they will come".  If the experience really is fun and the value really is there, good people will join you and be committed, with you, to the effort.  It has to mean something these days.
What I think is interesting is the fact that most golf courses are developed under the "if you build it they will come" theory. I don't think Mike Kaiser built Bandon because all the other golf resorts were full and demand exceeded supply. I think he hoped to create a niche market, and he did at first, but now Bandon might be considered mainstream because it is definitely a hit and gets a lot of positive press. I believe what Bndon did really well was stick to their theme. Fescue greens, walking only, hard to get to, they were like that garage band that has a great sound and unique story, and they stuck to it. Now they are the hit, but not because they tried to go mainstream, quite the opposite in fact.
I think keeping construction and operating costs to a minimum is essential in this market, but that is the easy part compared to creating that niche that supports the business. I know Bandon got a lot of press early on, but their sustain success has to be based on customers having an outstanding experience and sharing that with others.  

I believe a niche market exists for DR and the Sand Hills as well, i think we see that happening. What will be interesting to see moving forward is if the Nebraska Sand Hill courses work together to grow their niche as they too have a very unique environment that offers golf you can't get anywhere else.

Mike_Young

  • Karma: +0/-0
Re: Hit or Miss
« Reply #10 on: February 06, 2013, 08:50:00 AM »
Don,
Yes.  Agree.
I been building such for 27 years.  So please don't take the below as me advertising.
I do think you if you want to own them you have to go to the smaller towns where there are not 10 other courses and you need to be fairly confident that no one will come and build another ( fairly simple today).  A good example is Southern Hills in Hawkinsville, Ga. (http://www.southernhillsgolf.com/ ) It's in the middle of south Ga and the family does just fine with it.  Shallow bunkers, Triplexed greens but some strategy and good conditions.  I use this place as the example of 2/3rds of American golf.  It works.  OH..almost forgot...the Key factor....the son of the client played golf at UGA and studied turfgrass management and he just hasn't gotten around to doing the PGA thing yet ;)
"just standing on a corner in Winslow Arizona"

jeffwarne

  • Karma: +0/-0
Re: Hit or Miss
« Reply #11 on: February 06, 2013, 09:01:48 AM »
In the entertainment industry, it has always been about the hits. Box office hits, album sales, ticket sales, best sellers, always striving to have a hit. But now, we have the internet, iTunes and Amazon, and I read that it has never been better to be an unknown. Music, words or video take up very little space on a server, low cost to house, easy to share. While still great to be famous, to be a hit, to make a fortune, with most of the bottle necks to exposure and distribution gone, it no longer means offerings are limited to 4000 CDs at a brick and mortar store. An online seller might have 400,000 titles, and guess what, even #400,000 sells, a little at least. And so does #399,999 & #399,998.  Our mass market has become a market of niches.

Has any of that thinking hit golf? I don’t think so, but I think it should. I was talking to a friend today and said all he really needed was 1000 people who wanted to play his course. I think that 1000 people exist as he has a very nice niche to fill. In golf we’re mostly still all about the hits, the rankings, the big names. While we all know the big names, I’m guessing that for every golfer who plays Bandon, Streamsong, or Sand Hills, there are 1000s playing somewhere most have never heard of.
 
I believe a huge niche exists for those who are willing to forgo fame and fortune and just make a living. Maybe you’ll have a hit, maybe not, but wouldn’t it be cool if more in golf adopted the same attitude as the guy who has the 200,000th rank song, or the author who isn’t on any best selling lists, but has found a way to make a living?

 


I thought of 2 people when I read that
Mike Young who does this daily and Michael Kahn (golf course broker/operator/misc/) who writes interesting stuff about this
"Let's slow the damned greens down a bit, not take the character out of them." Tom Doak
"Take their focus off the grass and put it squarely on interesting golf." Don Mahaffey

Steve Lapper

  • Karma: +0/-0
Re: Hit or Miss
« Reply #12 on: February 06, 2013, 09:11:57 AM »
Don's theory works just fine in the UK market.  There are a ton of good courses there which exist through a combination of affordable memberships for the locals, combined with enough appeal to traveling golfers to get them over the hump.  In the UK, though, "remote" is not really so remote; nearly every course is within a half day's drive of the big cities, so as David would say, the distribution of the product is actually quite good.

The theory worked just fine in the Myrtle Beach market, too.  They managed to put together a strong enough marketing program to get a lot of people to visit the area, everyone stayed in basically the same place, and any course with a bit of sizzle was able to attract its fair share of the visitors.  Worked just fine until they started building more expensive courses, and too many of them.

For most U.S. markets, though, it hasn't worked well at all.  Many of the best courses are private, and even the public courses on the east coast (where more of the people are) have plenty of restrictions to favor local play.  In effect, those courses are all taken off the market; and because they don't participate, people aren't drawn to the area, and the second-tier local courses don't have easy pickings of the spin-off market from the big-name places.  Part of what makes golf in Scotland work so well is that Muirfield brings in visitors who then stay to play all the other East Lothian courses; Pine Valley doesn't do the same thing for southern New Jersey.

Tom, I agree with most of what you are saying here, however I beg to differ on the Pine Valley example. Yes, it's a private club, but visitors do regularly look for ancillary games throughout the immediate area. Granted, in such an example, most PV visitors look to play other nearby privates, but they regularly arrive at an ACCC or Twisted Dune. This effect does work in the Northeast and elsewhere. Many who go out to the Island for the a top 5 try to add an Bethpage Black and often even end up at a Tallgrass or Montauk Downs for another round. The likes of a Wild Horse and the publics of Chicago, Pinehurst and LA all get some of that. I've seen that happen very frequently when groups who make a cross-country trip with only one round privileged at an elite private.
The conventional view serves to protect us from the painful job of thinking."--John Kenneth Galbraith

Charlie Gallagher

  • Karma: +0/-0
Re: Hit or Miss
« Reply #13 on: February 06, 2013, 09:28:36 AM »
Don and company,
   Thought provoking point about filling niches. I will add one rejoinder and a twist.
    Golf courses, even 9 holers, are expensive propositions from  land aquisition through construction. Even the most basic maintenance will also require a significant cash advance. There are certain steps in the process where costs can be shaved, for instance a course could be constructed so that it can be mowed by a large gang mower, instead of multiple triplex fairway machines, as you well know, Don. I also know of an excellent Vermont course, Crown Point, where  a member designed the course and members built it. Still, there are certain fixed costs that will be expensive. This holds true for Ma and Pa Kettle's 9 hole course in Podunk and for National Golf Club.
    Pat Ruddy, the owner and designer of The European Club showed me two annual operating budgets, one for a northern course in the Republic and the other for a famous links near Dublin. The northern 18 had a maintenance outlay of about 450 Euros. Its south eastern cousin spent 1.3 million Euro. Pat made the point to me that if I played them both, I would not find the Dublin course all that much better than its northern counterpart. I know he is right about that, but the more limited budget facility still spent more than half a million US dollars on up keep.
    That being said, I will point out that as far as niches go I wish there were more 12 hole, 14, or 15 hole courses. One might have outstanding golf land that can't accomodate an 18 hole course. So what? I wish we weren't so slavishly oriented to 18 holes being the required test.  I believe Prestwick was originally 12 holes.
     My final thought is this, be it 9, 12, or 18, and mowed with a gang mower or many triplex or hand machines, it needs to be strategic, stimulating, and fun. I would say the majority of courses flunk those requirements. Maybe that's why a hard game isn't growing as much as it should.
  

Adam Clayman

  • Karma: +0/-0
Re: Hit or Miss
« Reply #14 on: February 06, 2013, 12:14:49 PM »

Has any of that thinking hit golf? I don’t think so, but I think it should.
 

Don, In my own experience, playing lots of golf gave me the opportunity to analyze why I was, or wasn't, having any fun. Caddying, allowed me to focus on how others reacted to different shots, under different conditions. What I found was that people lit up after hitting shots that had an extended reaction after hitting the ground. It was their smiles and posture that told me this was a significant moment of their day, and possibly their golfing life.

Overcoming the negative repercussions of the Augusta Syndrome is at the heart, of this hopeful change in mindsets. Are Turf schools focusing on low fertility models? Until that happens, learning the art of firm turf management, will be slow in coming.

Now that he's retired, Doug Pedersen (sp?) should start his own school. I hear he would use less than 50 lbs. of inputs, in a stressful environment,  and have the healthiest turf.




 

"It's unbelievable how much you don't know about the game you've been playing your whole life." - Mickey Mantle

Don_Mahaffey

Re: Hit or Miss New
« Reply #15 on: February 06, 2013, 01:41:16 PM »
Don,

You have succinctly stated Chris Anderson's 2004 theory of the Long Tail.


The problem: Golf remains a brick and mortar product, ...

If anything, Bandon is the course that proved there is a long-er tail for golf courses by standing up a product that had enough appeal to a geographically dispersed clientele to define a golf-only destination niche.  However, in another sense it represents another point in the resort golf market that pushed the elasticity of proximity throughout golf history.

Dave

Dave, I have Anderson's Long Tail on audio book and listened to some of it during my travels back and forth to Nebraska last year. I poached some of his ideas and should have given him credit. It is his theory of niches, how the tastes and preferences of consumers confound the mass market gurus, stuck in mass market dogma, that interests me.

In golf, I believe we are influenced by dogma that sometimes has no basis. Conditioning, quirk, contoured greens, levels of service…there are many generalizations in golf that while they may apply to a niche here and there, are not as widely accepted as industry experts would like us to believe.

I clicked on the link you provided and checked out Anderson’s blog. He doesn’t keep it up anymore but had some reports that the long tail phenomenon is occurring in travel. He believes that due to more information, via the internet and word of mouth from bloggers and such, (GCAtlas?) lesser know travel destinations are taking more of the market share each year. That has to bode well for national destination clubs/resorts that are off the beaten pathl. It has never been easier for a golfer to get real unfiltered information about Nova Scotia, the Nebraska Sand Hills, The Oregon Coast, or remote central Florida. Exposure is not the problem or challenge for these places as they are known and even with a lackluster economy, golfers are traveling. I think the key to all these destinations, as proven by Bandon, is to develop your own unique brand, build your own niche and live it with everything you do. People travel to remote destinations for a unique experience. They might come visit you once, but for them to return and bring more business, I think it important to have a theme, an esprit de corps among all the employees that says we are proud of what we have to offer you. I get that sense when I’m at Bandon, a sense that all involved believe in the product. I think you get that same thing from a small garage band that sits 1000th on the charts but still have a big enough following to survive. Being proud of what you have and the niche you serve would seem to be a pre-requisite for success in a vey competitive business.
« Last Edit: February 06, 2013, 02:15:30 PM by Don_Mahaffey »

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