Golf club manager warns of Groupon threat
The manager of Chalgrave Manor Golf Club in Befordshire has warned that the group-buying discount website Groupon is a threat to British golf clubs and has called on the industry to work together to defeat it.
The website, which has seen its golf market grow by 100 per cent in the last year, offers green fees, vacation packages, lessons and equipment to millions of registered customers at a reduced rate. This has given some golf clubs a marketing advantage over others, but there are concerns that it is damaging the overall revenue that is coming into golf clubs.
Steve Rumball believes that Groupon deals are as potentially bad to golf clubs as 2-for-1 promotions that have been blamed on club members converting to becoming pay-as-you-play ‘nomadic’ golfers and clubs sharing revenue with external providers, both of which hurts golf club income streams.
“There is a huge variety of non-golf organisations whose sole aim is to make profits on the backs of the golf clubs of this country, without ever having to make any level of investment back into those clubs themselves,” said Steve. “These 2-for-1, Groupon and other deals are devaluing our memberships and green fees, taking profits out of golf and are one of the reasons why golf clubs lost 42,000 members last year.”
Last week a sales representative from Groupon visited Chalgrave Manor and explained how the site could help market the club. But Steve was appalled by the restrictions that would be placed on the golf venue.
“We’re not allowed to decide how much to set the deal at - Groupon tell us that we are to charge £29 for a two-ball voucher or £54 for a four-ball voucher, which includes coffee and a bacon roll plus 18 holes for all players. These rounds could be played midweek or weekends,” he said.
“The end user buys the voucher from Groupon, who keep all the money until it is used at my club. I then have to take the voucher and correctly process it back to Groupon. Two weeks after I’ve provided the food and golf, I get paid 50 per cent of the voucher value from Groupon.
“If the voucher is never redeemed, Groupon keep 100 per cent of the money.”
However, he believes there is a solution, in which golf clubs compete against Groupon.
“If every golf club in the country invested, say, £200 of ‘seed money’ into our own, central business operation, we could create our own online presence and shop that initially offered the same 2-for-1 Groupon-style voucher system to nomadic golfers. After a year or two of marketing our system to golfers with Groupon vouchers at the coal face, we will have proven that our system works, and we could stop using others’ systems and corner the entire market for ourselves,” he stated.
“All of the income from voucher sales and deals would go to the golf clubs. And the clubs could set their own time-bands for each day for when the vouchers, or what percentage discount, could be used.
“We, as clubs, have to accept that there is now a massive golfing population that does not view club membership as a particularly attractive proposition. That is why we need a central organisation that is operated by golf clubs for golf clubs.”
However, he warned: “It all sounds quite simple really and quite frankly it is until you realise that you need to get the majority of golf clubs to work together for the common good in order to be effective. That will be the difficult bit.”