SLRG’s Jon Last kick’s off Golf Inc.’s new Wisdom series with a current snap shot of how consumer attitudes and behaviors will be impacting the golf market, this season.
We caught up with Jon Last, president of Sports & Leisure Research Group, at the PGA Show in January and he shared the latest research data from his company about the current state of the golf industry, including golfer behaviors, attitudes and expectations, as well as the things facility operators and golf marketers should know before making key decisions for their courses.
Full transcript below:
What’s the latest research data you have on golfer behaviors, attitudes and expectations? What should facility operators and golf marketers know before making key decisions?
There’s a number of ways to look at where the consumer is sitting right now. One of the things that’s been really intriguing to us over the last few months has been what we call this economic oxymoron in the sense that people are still very concerned about where the country is going. There’s a lot of concern and strife about economic feasibility. A lot of concern about inflation, but yet obviously, the golf industry has been enjoying such a huge resurgence in recent years. And our data shows that that will likely continue, particularly at the higher ends of the marketplace. I think, though, at the same time, operators need to be mindful that there’s a lot more discernment now as we go into 2025 and to some degree, we may be approaching the ceiling, if you will, in terms of the ability to push rates higher and the ability to really expect increased volume of play from existing customers.
You know, the good news is the inventory of golf courses is not as robust as it was prior to this latest resurgence. That will continue to create demand on the private club side and data that we’ve just collected a couple of weeks ago and data that we’ve been collecting for about 20 years, we find that 53% of private courses are currently full or have waiting lists. So that’s going to continue to show real demand at the higher end of the market.
Where the concern lies is on the other side of the market. We’re looking at credit card debt that was up 8.4% from a year ago at $1.17 billion. We’re looking at the average household needing $11,000-14,000 more per year to equal their pre-COVID lifestyle. We’re finding that you know, at the same time that all this is going on there is just this increased impetuousness where golfers and customers are wanting to actualize as quickly as possible “Live for today rather than for tomorrow.” That has great short-term implications, but at the same time, it really behooves the facility operator to understand where those price elasticity points are. It speaks well to the implementation of dynamic pricing. It speaks well to utilizing things that our firm does in terms of helping measure price elasticity and ceilings where customers are looking to go and it really creates a need to be hyper local and understanding the competition, not just from the standpoint of other golf facilities, but from other leisure and discretionary activities that are competing for time and attention.
The good news is we’ve been doing it right. The good news is that for the first time in, really, as long as I can remember, a lot of the conversation about creating a more welcome golf environment that meets customers where they want to be, it’s not just lip service now, but it’s actually something that facilities are doing. So we are in this era of democratized golf that we never had before. And I think as long as facilities can listen to the customer and be more open to creating these different experiences that go beyond the traditional 18-hole round of golf, they’re well positioned, unlike how perhaps we were during the last boom that didn’t really have sustainability.
What are your observations on current golf industry trends and the amenities being offered?
Part of what facility owners and operators have been very effective at pivoting to in this latest resurgence of “meeting the customer where they are” is the introduction of a number of different derivatives, and clearly simulators and screen golf have become incredibly popular in research that we do with the National Golf Course Owners Association.
We found this year that about 34% of facilities have created these gamified ranges. And obviously it creates a whole nother entry point for people that may not be willing to or have the time or inclination to pursue a traditional 18-hole round of golf. These customers aren’t necessarily the same in what they want and in terms of what type of experience is going to drive value for them as traditional customers.
So again, I think it’s important to understand where different people fit in and I think it’s also important to understand what the competitive set has been because even though we’ve seen an increase in facilities implementing these types of amenities, we’re also seeing a much higher concern that the market may be getting saturated, so both with concrete standalone facilities with gamified golf and the influx of these types of amenities at traditional golf courses, it’s going to be important for an operator to understand what the real demand levels would be and what the competitive set looks like before you get to a situation where we may see supply outnumbering demand.