What Other Bloggers are Saying: Part 2

This week, two posts piqued serious interest, both of which are shared, with discussion, below. On Mr Business Golf, Scot Duke, laid out the various problems facing the game of golf. His discussion was thorough, but lacking answers to the questions he posed. In an attempt to expand the discussion and offer a few solutions to topics he brought up (and some he did not), I responded with some viable options, but also with other questions. Many of the issues brought up created paradoxically aligned stances of the status of the game. I hope for the sake of quality discussion that I hear more from Mr Business Golf on the matter. Next, on In Between 18, which I found for the first time this week, Mr. Goodman responded to the criticism that Northern Trust, a financial institution that received TARP money (parodied bottom left) from the US Government, received after hosting their annual PGA Tournament at Riviera Country Club (pictured right). I took the opportunity to rant and rave here, not at the author at all, but at the critics. The topic has been hitting a nerve, and I welcomed the open door Mr. Goldman provided to publish my thoughts.

“Issues Hurting Golf”
Comment

Given the invitation, here are a few solutions and a few rebuttals to the discussion of what ails the game of golf. Business golfers, yes, “drive the cart” for the industry. Always have; always will. The industry over-invested in “the ‘C Suite’ executives who carry the Corporate Checkbook on the corporate jet,” creating too many ultra-luxurious golf getaways for only those that can pay top dollar. Corporate retreats and outings to golf courses fall under this category as well. What affects those executives right now is not what generally affects the everyday golfer, but a fear of being labeled frivolous. This is only a cyclical issue; as soon as the economy rights itself and TARPees repay the Government, no one will even notice such trips. As for these same corporations, like Northern Trust, getting smashed for sponsoring a golf tournament, once again, corporate image is the culprit. The media is quick to jump to conclusions without understanding the need for such a company to generate exposure and quality advertising outlets through the PGA tour and its attendees. These things, like the others, will pass as the country rights itself. As for the issues affecting the non-Business Golfers, the industry needs to adjust.

Too slow, too costly, too hard, and not worth it; these are the arguments, right? In response to the pace of play issue, especially concerning the assertion that “greed and bad management of golf course operations” contributing to the problem, two opposing issues emerge. First, if the course plays slowly because the management stacks fivesomes every eight minutes apart, does that mean bad things for the game? It sounds like too many people want to be out on those courses. Economically, the management could earn the same amount per group by limiting to foursomes only, spacing them out every twelve minutes and charging 20-25% more per round. The courses that have “bad management” are clearly the ones that employ the low-cost, high volume approach to profit. Here is the conflict: does golf want more people on the course and slower rounds for low prices, or fewer people on the course and faster rounds for higher prices? The everyday golfer needs to understand this trade-off between courses, as they are clearly diversified to target each golfer’s needs. Either pay more, or stop complaining about the 6 hour round. Until golfers are attracted to Executive courses, where one can play shorter, but sometimes challenging holes and half the price for half as long, they will still face this dilemma.

Thank you for the post, but I really would like to hear your solutions.

“Noble and Perhaps Unnecessary”
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The incident you bring up is utterly appalling. Arguably, Northern Trust did not even need the TARP money they received, and probably would be better off now without it. You are right, Northern Trust has nothing to be ashamed of except poor timing,” the media and critics within the Government should be ashamed for their lack of understanding of simple business practices. If one does not even take into account the penalties and broken relationships the bank would have suffered from pulling out of their sponsorship deal with the PGA Tour, the reasoning for keeping the tournament should still be crystal clear. A company like Northern Trust, that derives a large amount of its revenues from everyday individuals, like those that attend and watch golf tournaments on TV, needs to advertise. Truthfully, commercial banks offer nearly identical products. People choose one over another on perception and location. Northern Trust sponsors this golf tournament to reach people and build their business. Furthermore, it would have been a really bad signal to investors about the status of their business had they pulled out.

Additionally, any PGA tournament also boosts the economy of the area in which it is located. Whether fans are traveling to area and staying in local hotels to see Phil Mickelson play or just buying a few beers on the course, golf tournaments bring large revenues. By hosting their tournament, Northern Trust provided jobs to servers, parking attendants, coordinators, are all the other people involved in the production. Does the media understand this when the criticize Northern Trust for wasting taxpayer money on frivolity.

Golf Demographics: Surviving Through the Ages

I received a comment last week that brought up an issue I had been planning on discussing since this blog’s inception. One-Eyed Golfer, an accomplished blogger in the golf realm, introduced demographics into the conversation on the health of the sport. He charged Gen X and Gen Y with responsibility for declining rounds and revenues, but left the door open for further discussion. Basically, the argument presented was based on the outlook held by younger Americans that golf is too time consuming and too costly. Though I agree that my generation and the one preceding me are playing fewer rounds than our parents (one cannot refute hard data), I argue that the game has yet to benefit from retiring Baby Boomers. Furthermore, I believe the game has the potential to adjust to the Gen X and Gen Y lifestyles through appealing to families and time-constrained players.

First of all, let me clarify the terms I will be using here to discuss generations. The Baby Boomers, which makes up about 25% of the country, were born between 1946 and 1964 (ages 63-45), according to the Census Bureau. Next, Generation X (Gen X), often called the "baby bust" for declining fertility rates after the Baby Boom, was born between 1964 and 1976 (ages 45-33). And finally, Generation Y (Gen Y) was born from 1976 to 2001 (ages 33-38). Pictured above, the population pyramid as of the 2000 US Census shows the layout of the US population by age. Note the bulge from ages 54-35 on either side to understand the impact Baby Boomers have had on the US population just by their sheer numbers. In the 2000 Census, the age group consisting of 45-54 year olds increased 55% of the 1990 Census. This dramatic increase will carry through for years to come. According to the Census Bureau projections, the 65 and older age group is expected more than double by 2050. An older population means great things for the game of golf.

As one of the liveliest generations this country has experienced, the Baby Boomers will require further activity through retirement. I foresee hundreds of thousands of Americans in the next 10-15 years moving on or near golf courses to be close to the game. My perception drives this opinion, but a study from 2006 showing the Baby Boomers playing fewer rounds per year, as compared to their predecessor, but at a higher participation rate, reinforces my premonition. This is good news; even though the Boomers are playing more infrequently than those before them, more of them are playing. The downside – infrequency of play – can be easily attributed to something that is great for our economy, but hurting the game of golf: the Baby Boomers are still working. Frankly, they do not even want to be associated with retirement. Even the AARP underwent a makeover to adapt. The group does not spell out the entire name anymore. Christine Donohoo, associate executive director of the membership division at the association, stated “the boomers want to be seen as vibrant - and we need to be responsive to that.” The Boomers have built their generation around that of activity and change, and basically, they are not coping well with aging. Accordingly, the average retirement age has been increasing at a steady rate over the past couple of decades. Older Americans possess a greater expectation to be self-reliant throughout retirement and provide wealth to their children and grandchildren after death. I am an optimist, though. As it relates to the game of golf, however, more workers equal fewer golfers. Retirement and golf have been synonymous among my generation and for good reason. The game is challenging yet easy on an older person’s body, and it supplies enjoyment and needed exercise. Studies have actually shown that golfers live longer than others and that the activity involved in playing one round of golf can even make you sleep better. The game stands to reap higher play and greater revenues when the Baby Boomers retire, but with what is happening to almost everyone’s 401Ks, many Boomers are pushing their retirement date back. Golf will have to wait.

On the other hand, golf has not been too popular with Gen Y and Gen X. We believe the game is too slow paced, takes too much time, costs too much, and does not constitute ample exercise. I love the game and always will. But, living in downtown Los Angeles, taking a full load of challenging courses, and trying to build a social and professional network, I rarely find time to get on a course. And I mean rarely. Last semester, excluding holidays, I played three times. To put this in perspective, if I did not play three times over a five-day span in high school I would not have slept. In college, on the brink of entering the real world, I can not find time to enjoy a round, and neither can most of my classmates and co-workers. We, Gen Y, have too many things going on, too many pressures to be successful, and too many appealing alternatives to get outside and exercise. The generation before us, many of whom are our parents, feels the same way. Yet, they have one more factor that keeps them off the course: children. With pressures to put their children through the best schools and provide for them the best opportunities for success, a parent can not spend 5-6 hours on the golf course very often. Nor do they want to spend that kind of money on themselves.

Nevertheless, solutions to the Gen X and Gen Y problems do exist. Implementing them, however, will be a real challenge. First, the game needs to get shorter. Designers of executive courses, like Knight’s Play (pictured adjacent) and par-3 courses are beginning to understand this with some recent courses. The game can market itself as a sport that can be played in less than two hours and still be worthwhile. The top designers will be reticent to this movement, but if people prove this profitable, the Pete Dyes and Jack Nicklauses of the world will follow (well, maybe not those two). These courses are cheaper than the traditional courses, too. I generally turn my nose up to executive courses, but usually because the holes are uninteresting and poorly maintained. Make them fun and in good shape and I will attend. So will others.

Next, the game needs to be marketed as a family experience. Show parents the benefit of learning the rules and etiquette of the game, and how professional golfers are the only professional athletes that take responsibility for self-administering the rules. Open courses that let families play two or three holes together without pressure from serious golfers to keep a steady pace. What is more, market golf to children, for they are the future of this game. The ones that catch on will graduate to full-length courses. Gen Y parents want to be around their children and teach them new things while keeping them away from video games, TV, and computers. Walking around a beautiful, green golf course for a couple of hours in a day with your children is a great way for families to connect and interact. Later, parents can drop off their adolescents and teenagers to enjoy the sport with their friends and build camaraderie.

If the game can realize its potential among the younger generations, it could have a bright future in American sports. Golf has the ability to bring generations together as a binding force, which it already is. Younger Americans need to stop associating the game with reirement. And, frankly, the Baby Boomers need to retire. The sport will always be successful in the older demographic. Leave the country clubs to the retired and upper class, and give us something new. If that happens, we can all enjoy the game in our own way.