Jeff Foster, Senior Vice President, New Media Group has sitting outside his office a stuffed animal – a big hairy bull representing GolfNow’s BHAG.
A BHAG (Big Hairy Audacious Goal) is a statement of strategic intent – the result that the company hopes to achieve in 10 – 25 years. It is the inspiring statement that all can rally around.
Their BHAG is meant as an internal communication that they want to facilitate the booking of every round, everywhere.
As stated by a marketing representative for GolfNow, “It’s stuck with us, and it remains a powerful message for us inside our company. The big hairy bull has become a kind of mascot.”
The BHAG represents what GolfNow excels at – media promotion. What it doesn’t capture is why they have no chance of achieving that goal. As good as they are promotion, they are equally as bad at technology which is the foundation on which their strategic plan is built.
Think we are being harsh?
On January 4, 2016, GolfNow was offering a tee time at TPC Las Vegas for a 24% discount – $175.00. Click here to view GolfNow posted times. If a customer went to the TPC Las Vegas website that same tee was being offered for $75.00. Click here to view confirmation. That is right – the actual cost of a tee time was $100 less on the golf course website than what GolfNow was representing was a 24% discount on theirs. In November, we documented at another course (click here) the disturbing trend of GolfNow falsely publishing the discounts being offered.
How could that happen? The GolfNow website is not integrated into the TPC Network. GolfNow’s technology is flawed.
The bigger issue is one of integrity. When a vendor can’t be trusted, ultimately its brand becomes tarnished, and its revenue and profits decline. I speculate that in the past few years GolfNow has not met its business plan revenue targets. I surmise that the company’s revenue stream has become dependent on the transaction fees charged for each reservation booked.
Integrity is fundamental to long-term corporate success. I feel that virtue is compromised in GolfNow’s marketing spins far exceeds the functionality of their technology.
On January 8, 2016, GolfNow offered a client access to their dynamic pricing tool for $3,000 per year for their three golf courses. The retail value that the GolfNow representative stated was $4,000 per month per course. From the sales presentation made to the PGA Professional, he was left with the distinct impression that GolfNow’s yield management software would handle all of his reservations.
The impression the PGA Professional was left with was incorrect.
GolfNow’s dynamic pricing tool works on the “online” portion of reservations, i.e., a golf course’s website. To use GolfNow’s dynamic pricing tool, you are required to continue to use their booking engine. If you don’t, dynamic pricing of the tee times that are booked offline by the staff on the course’s tee sheet which, at most courses, represents about 85% of all tee times would not be covered.
The GolfNow software is an incomplete solution in that it doesn’t do demand forecasting with RevPAR by distribution channel. They merely look at a tee time as open or booked. True revenue management would monitor the number of locals, season pass holders, loyalty card players, and tourists to ensure the optimum balance between each.
GolfNow’s implementation is based on greenhorns using Excel sheets to load manually rates vs. dynamically changing rates automatically based on demand.
To label their software as a “yield management” tool is a misnomer but because it is a popular buzzword that, so few understand how the software should work, they can get away with it. Thus, GolfNow’s dynamic pricing tool will have little revenue impact as the technology is misrepresented.
In equity, I should highlight that Mike Hendricks of GolfNow, who is behind the dynamic pricing initiative is very smart, and is one of the few, in the past year, to introduce new technology to the GolfNow suite of products. The link to Hoot Suite to monitor a golf course’s social media is very interesting to monitor a facility’s brand. However, he is one of the few bright lights amongst the 504 employees. The great claim as to their talents is 23% have golf handicap indexes less than five. That is noteworthy because according to their 2015 Annual Report: Slides that was posted to Linked-In (click here) only 70% of employees play golf.
Websites for client offered by GolfNow are developed offshore in India and are graphically beautiful and functionally worthless. They are information oriented vs. transaction focused.
The various software platforms they offer have limited meaningful reporting capability. Save for Open Course, they nearly all lack the ability, particularly Fore Reservations, to produce meaningful key performance benchmarks regarding rounds, reservations, yield, and distribution channels.
Finally, the naiveté of GolfNow on technology is best illustrated by their acquisition in 2011 of a POS product from an East Coast hair salon thinking the tablet based product could easily be modified for use at a golf course with their mobile pro shop cart. The software is described on their website as:
“With its suite of seamlessly linked services, GolfNow One is our most advanced business management platform. This world-class, cloud-based solution merges all your software and operating systems into one lean, clean revenue-enhancement machine. With G1, you can promote, book, sell and manage your business with one system from any Internet-ready device anywhere.”
Just marketing – at which they excel. Unfortunately, the product has seen little market penetration after four years as early beta tests panned the software.
Many golf courses use GolfNow out of fear not out of love. They are afraid of being left out. But let’s look at the numbers. Is GolfNow a good deal?
At GolfNowsolutions.com (click here) they feature, that through November 2015, they generated $372,778,179 for their clients reserving 14,656,649 rounds.
Impressed? I am not. That is only $25.43 per round which is 44% below the average price of a green fee. For each of their 8,752 clients, they generated $42,593. It is rumored that the gross revenue of GolfNow is about $150 million or $17,138 per client which represents a 40% commission on tee times sold. To generate this revenue, they sent 3.5 million golfers over 527 million emails. Each golfer received 150 emails. Wow – talk about spam and hurting a golf course’s brand.
We should take our hats and salute that marketing prowess, at least in the short-term, is the path to profits versus offering products of value. But I ponder, where is the value to the owner?
What do you think? Comment below.