(Near) future thinking about the golf industry

The golf industry’s numbers are looking good, at least for the short run. Long term is another matter, more of speculation and trends than of any detailed predictions. What this all means for superintendents is perhaps the most important question to be asked as we move into the 2022 golf season.

Overall, the immediate indicators for the golf industry are remarkably strong — this coming out of two amazingly strong years registered in the face of considerable headwinds. Late winter/early spring 2020 (remember?) saw a dramatic slowdown, with closures in many states in early response to the COVID-19 pandemic. This was followed by 18 months of labor shortages, supply-chain backups, rising costs for basic materials, and totally altered workplace interactions due to precautions and social distancing.

Superintendents got stressed and overworked as golfers flocked to the course, liberated by the prospects of healthy, safe outdoor recreation and more disposable free time now that they were released from office work and commuting. The activity continued through 2021.

That’s the headline from the latest “State of the Industry” report by industry analysts Jim Koppenhaver of Pellucid and Stuart Lindsay of Edgehill Consulting. Their presentation, a can’t-miss staple of the PGA Show since 2003, combines folksy humor, dart-like observations and the kind of data-geek PowerPoint overload that nerdy analysts crave. In the past, they’ve been criticized for being unduly pessimistic; this time around, they surprised even themselves with their upbeat message.

This is, after all, an industry that “lost” 85 million rounds in the U.S. since a high of 518 million in 2000, down to 433 million in 2019. And now, in the last two years, the industry has regained that exact total — all 85 million, according to Pellucid/Edgehill. The 518 million rounds registered in 2021 mark a 20 percent gain from 2019. That’s two consecutive years of phenomenal growth: 14 percent in 2020 and another 5 percent in 2021.

More golfers means more playing equipment sold, more cart fees, more membership dues and greater utilization of the golf course. This perception of a busier golf course is confirmed by a revealing data point regarding tee time utilization — the golf industry equivalent to hotel occupancy rate. If you take the total number of available tee times, adjusting for weather and seasonality, and measure that against actual bookings, golf went from a utilization rate of 56.8 percent in 2019 to 67.3 percent in 2021. And this was not achieved by widespread discounting, according to Pellucid/Edgehill, but by facilities holding the line on pricing and consumers willing to pay more.

For years, industry’s gradual slide has been explained as a function of the game being “too hard, too time consuming and too expensive.” Yet what is most impressive is that these recent gains have been achieved without any demonstrable increase in pace of play or price discounting.

As for the notorious difficulty of golf and how that is contrary to the behavioral wiring of millennials and Gen Xers, it turns out that consumers adapted by playing what Koppenhaver explained as “recreational golf.” While golf association managers might fret about arcane issues like “bifurcation,” everyday golfers, it turns out, are not worried in the least about legalisms and are simply out to have a good time.

“To heck with the USGA rules,” to paraphrase Koppenhaver, in an expression that he instantly knew could get misinterpreted by certain folks. And yet that expresses a profound truth. It’s one thing to play competitive golf and adhere to strict rules. It’s quite another to go out, have a good time, try to hit golf shots, soak up a beer or three with friends and not worry about extricating a wayward tee shot from the crook of tree roots.

The enjoyment afforded by golf appears to be catching on, with golfers willing to pay for the privilege in a way that course owners and managers need to appreciate. It appears that golfers, including many newcomers to the game as well as those who have come back, are willing and able to pay more for golf and just chalk it up to inflation — much as they put up with rising consumer costs for food, gasoline and clothing.

One of the lessons of the hospitality industry has been that people are willing to pay for service, and especially for enhanced services. That holds an important lesson for superintendents and budget managers who face important planning decisions for 2022 and beyond. It pays to keep up course conditions and to improve on infrastructure.