I first saw a demonstration of a golfer booking a tee time over the internet by someone sitting at a computer, 10 years ago. Yes, that’s right, 1997.
The company felt it was only a matter of time before every golfer would be booking this way.
They were right – but the matter of time was about 11 years! Because 2008 is actually destined to be the year when golf bookings really start to take off online and both golf clubs and golfers will be benefiting from the efficiencies that can be delivered by the Internet.
Eighteen months ago, you’d have struggled to find a tee time booking business in the UK golf market and now there are five major players in operation, including Online Teetimes Ltd (OTL) and their consumer-facing site www.TeeTimes.co.uk
Two, like OTL, are specialists, while the other three are underpinned by existing businesses that generate millions of pounds of golf revenue from traditional sources like equipment and holidays every year.
So why are they all in this space? Because a growing number of golfers are using the Internet for booking and ordering items they would normally have purchased by a different method.
Airline tickets and hotels are the best known examples of this, but now it includes books, cds tickets for trains and concerts, regular weekly shopping and car hire.
This is not how everybody is transacting, but the new consumer is, and the future for golf clubs is in the new consumer. If golf follows other industry trend, then the majority of green fees will be booked online within the next three to five years. And that is a significant new market.
There is plenty of evidence of this significant market. Earlier this year OTL reached a milestone - having sold €1 million worth of online green fee sales. It’s taken time, but it’s a landmark nonetheless.
The market is shaping up
Online tee time booking is still an embryonic market, but it is attractive enough to for OTL to invest heavily in their UK website www.TeeTimes.co.uk and to also build a White Label version for Direct Golf UK - the largest online golf retailer in the country. And although some might not agree that is good news, with a large and growing database of customers, and 13 stores nationwide, they’re ideally-placed to successfully market tee times to a large, captive audience.
OTL is supplying the tee time inventory on their site in a partnership agreement implemented to ensure their clubs’ tee times are distributed as widely as possible, because distribution is the real key to developing the online tee time market.
And it is the same issue for golf clubs. Distribution through the various operators like Online Teetimes Ltd will maximize the online revenue for a club, provided the operator has a business model that makes sense.
Car hire is a great example of how to get it right. Superbrands like Hertz and Avis spend millions every year to promote and advertise their own online businesses, yet they are willing participants in www.travelsupermarket.co.uk, which promotes hire cars deals from more than 20 other competitors.
These major players understand yield management better than anyone - a rental car sitting empty is generating no cash at all. Avis UK commercial director, Daniel McCarthy, recently launched a £12-a-day promotion with a simple PR message: “We wanted to make car rental as cost effective and accessible as possible.”
The consumer thinks: “Great value and service from those nice people at Avis.” Avis thinks: £12 is better than £0.
Something akin to this thinking with respect to yield management will see many golf clubs generate strong online revenues from vacant tee times.
For a long time, discount voucher schemes have effectively set the price for discounted golf at 50% and clubs need to avoid simply moving the 2 for 1 principle online because it does not increase yields or offer the golfer anything different from what they receive presently.
The Internet provides clubs with a very flexible pricing tool and the reality is that 20% or 30% off might be just as attractive to the online golf hunter for certain off peak times. It is the function of the online teetime operators to help clubs to find these crucial price points.
At a recent meeting with St Margarets Golf Club in Ireland, OTL discussed how the yield management principles were working. The key points were that their rounds booked online were up by over 100% year on year and even more interesting was the price per round, the yield, was up by 5% - quite a result for year two.
Best practice
Over the next 12 months clubs will see the online channel move from the pioneering phase to the growth phase. Right now there are a lot of tee times on a lot of websites like www.TeeTimes.co.uk and while booking activity is definitely increasing, the tipping point for viral growth of bookers has not been reached. This should occur sometime in the first half of 2008.
Much of the responsibility for the development lays withthe operators, but clubs can play an important role in a couple of areas.
The main one is that web prices must not exceed the price on offer at the club - as this totally undermines the online channel and runs contrary to all other industries. Imagine if an airline ticket was more expensive online than if you purchased it over the phone or from a travel agent. Nobody would book online.
There are fees that may be charged by some companies, but the consumer can choose whether to pay these booking fees or not. But the price for the tee time should never be more expensive online.
The other main area where clubs can affect change is with their tee sheet providers. Integrating with tee sheets is very simple for the online tee time companies, but the clubs need to request the integration from their tee sheet suppliers. Real-time booking offers clubs the best possible opportunity of securing an online booking because they can offer the same times to any and all of the operating companies without the admin hassle or the risk of a double booking.
Clubs should see this as an exciting opportunity – when was the last time five companies rolled up to your golf club and said: “We want to sell your tee times for you” and then backed it up by developing web sites, building partnerships, informing databases of golfers of your inventory and, of course, providing customer support to both the clubs and the golfers.
Online tee time booking has finally got out of the starting blocks – but it’s not a quick dash, it’s a concerted and consistent effort over a long distance. What clubs need to realise though, is that if they’re not there to hear the gun in the first place, they’re not even in the race – let alone in with a chance of winning it.
John Kelly is an award-winning journalist and editor, who specialises in the golf market. He xcan be contacted via www.hiseman.com
|
