GolfNow vs. Golf Course – The Battle for Market Share and Attention

In 2019, GolfNow was affiliated with more than 7,000 golf courses. Ezlinks distribution platform teeoff.com was affiliated with approximately 3,000 courses. GolfNow facilitated worldwide some 17m rounds of golf in 2019. This number is up from 3.8m rounds of golf in 2009. In December of 2019, GolfNow acquired EzLinks and if you visit golfnow.com today the number of golf courses they work with currently is 9,000. How many rounds are possible in 2020 by GolfNow with this major acquisition?

Article about 2009 GolfNow Rounds:

https://www.prnewswire.com/news-releases/united-states-patent-and-trademark-office-recognizes-golfnowcoms-innovative-online-tee-time-booking-technology-85239087.html

Article about GolfNow acquisition of Ezlinks and 2018 & 2019 data:

https://www.forbes.com/sites/erikmatuszewski/2019/11/23/golfnows-merger-with-teeoff-makes-waves-in-golfs-online-tee-time-market/#923f7645399c

Why would anyone critique a business that is delivering that volume of golf rounds to golf courses? If you are receiving reports that GN rounds are growing at your facility level, that is because in all likelihood they are. Growing from 3.8m rounds to 17m rounds in ten years is no small task. Their data says they are growing, and they are. Are they helping your business?

There is a major statistical flaw with any assumption this growth has helped our industry. Public golf rounds are not growing. Per Pellucid Corporation reporting (https://www.pellucidcorp.com/), public rounds dropped from 372.2M in 2009 to only 344.2M in 2019 in the United States. It is hard to know exactly how many of those 17m rounds were sold in the United States. However, by visiting golfnow.com you can see the vast majority of the courses featured are in the United States. How is it that GolfNow is growing its market share in the face of shrinking public golf rounds? Who is being impacted? There can only be one answer, the golf course owners and operators are being impacted. One scenario, that can explain what is happening in our industry is competitive displacement.

“What is competitive displacement?”

“Competitive displacement is the act of convincing companies to make a shift from their existing solutions to yours.

Competitive displacement businesses capitalize on the mistakes, mishaps, and missed opportunities of their competitors.

Organizations utilize competitive marketing tactics and campaigns to shift loyalty.”

For more information on competitive displacement please see the article below which describes this concept in detail.

The golf industry has been historically poor at collecting golfer data and marketing to their customer. Through a combination of national network distribution, acquisition, and owning the lowest rate, one company GolfNow has managed to capture 3.5M unique worldwide users that booked 17m rounds. The right questions to ask are as follows:

Is this third-party bringing in new golfers?

Is this third-party making golfers play more often?

If the answer is yes, don’t you think total rounds would be growing?

If rounds are not growing, and our market share is shrinking, are we simply just displacing our organic customers into third party channels?

 

How does competitive displacement occur in the golf space? Anytime a club loses one of the following:

1.) 100% ownership of its customer data

2.) 100% assurance their customers will not be remarketed to their competitors

a. Jay Karen, President of the NGCOA has posted two articles that clearly outline the marketing efforts which draw your customers away from your course and to GN.

i. Does your marketing partner use your golf course and tee times as part of their biggest promotion of the year, and you get $0 from it?

ii. Why golfpass may be the worst thing for golf courses since barter.

3.) 100% control and ownership of the lowest price in the market

Then, inevitably in time, the displacement of your customers will occur. Your customer’s data will be in someone else’s hands, they will re-market to those customers to advance their business, and they will achieve pricing loyalty by offering the lowest price. Any club that barters is subscribing to competitive displacement in the golf space. In a season, perhaps the impact is minimal, but over the course of many years, you are subscribing to a weaker business model.

 

So here is a scenario, every golf course owner in the country is brought to a meeting in 2009. We are told the following facts.

1.) Public Golf Rounds will drop in the next ten years from 372.2m rounds to 342.2m rounds in the United States.

2.) Approximately 800 Golf Courses will close in the next ten years in the United States.

3.) Through third party distribution, you will have access to 3.5M unique golfers who will book more than 17M rounds of golf worldwide. However, your market share will not increase. In fact, it will decrease.

 

Would the owners and operators sign up for such a Macroeconomic impact? I doubt yes, but this is the world we live in right now. When you give your data away, your lowest price, and when your historical market share is shrinking then it is time to take your golf back!