What exactly is yield management?
Yield management is a series of programs offering special rates and packages to targeted customers at certain times to better manage tee-sheets and maximize revenues. Participation rates have remained static over the past several years. Owners still require a return on investment under increasing pressure to retain their share of the golfing pie that continues to get smaller with increased competition from new facilities. Charging less for the same product is difficult to accept, but in many cases course operators have no choice. Creating a packaged experience is another alternative.
What are the keys to yield management? First and foremost is targeted marketing. Operators need to know and develop a customer database including email addresses in order for notices to be sent on a relatively short notice. Most multi-facility operators today have relied heavily on these blasts to advertise specific discounted rates off the regular rack rate.
Being proactive rather than reactive in these blasts are much more efficient. Operators need to look at tee-sheets ahead of time so that customers will have the opportunity to make plans to play.
John Easterbrook, Vice-President of Operations for Troon Golf indicates that they look 3 to 6 days out, keeping in mind that most owners and operators in reviewing these yield management techniques look ahead on a daily and weekly basis. This does not necessarily mean they want the same price or discount day in and day out because they may be able to fill these slots at selected times by different groups.
What yield management has done is to allow facilities and companies to develop an extensive database of customers allowing the company to know who the customer is and where they are playing.
Other types of yield management programs that have seemed to be successful include utilizing tee-time promotions that encourage people to play on the shoulder or the off-peak times by offering a specific discounted rate or added-value package that may include any combination of the cost of a round of golf, use of the range, golf instruction, merchandise and food and beverage.
How many names can be collected from the database and email addresses, Meadow Brook’s Mike Kelly indicated that they have 300,000 email addresses and utilizes it for special types of programs including a discounted rate especially if the forecast calls for cold or rain in the afternoon.
The PGA of America through its Play Golf America web site provides facility operators with the ability to build and maintain a customer database for future marketing campaigns including e-mails to promote available tee-times and upcoming events or instructional programs. PGA and LPGA Professionals may create and maintain their database of customers by either scheduling their events online at the playgolfamerica.com admin site and providing potential customers with the ability to register for these programs online, or by directly entering the names of customers participating in various activities in the Customer Registration and Database area of the admin site.
Given that time is the number one barrier to increased participation in golf, facility operators need to consider a variety of ways to create opportunities for shorter rounds of golf while utilizing unused space on the golf course. With over 50% of the golfing public plays less than seven rounds a year, think of how many we could coax back into the game if we could offer a six- or nine-hole tee-time. You can make it happen if you just apply some creativity to your planning!
Idea #1 - Take a block of three 18-hole tee times and "convert" them into six sets of 9-hole tee times, much like a "timeshare". Sell them at 55% to 60% of the full price. For relative beginners, offer to send a mentor out with the golfers to help them with their experience and to also serve as a sensitive ranger to insure that the group maintains a desired pace of play. He or she can escort them off the course after nine holes, and then usher the next three groups onto the back nine without missing a beat.
Idea #2 - Offer a block of six-hole tee times first thing in the morning by starting them on the 4th hole. Offer 9-hole tee times on the back nine during that same timeframe. Utilize a mentor in the same manner as outlined above when appropriate.
Operators also need to look at specific functions that are going on in their particular areas. If a football game, college or professional is played in your area, it may be time to create a specific set of tee times at a significant dollar value. The key to yield management is put people on the golf course. Operator expenses are going to stay consistent from the time they open until the time they close. Any revenue that is accumulated throughout the course of the day is better than no revenue.
With the saturated market today, it certainly is a significant management tool utilized properly to get more players to your facility.