Private clubs get creative

September 7, 2008
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Some clubs discover that outside-the-box thinking pays off in elusive new memberships, added revenue "I run across a lot of clubs who are not doing so well and they're starting to think about why and what they can do about it." That observation, from private club consultant Heidi Voss of Bauer Voss Consulting, sums up the dilemma many of today's private golf and country clubs are facing. Economic pressures, from layoffs to fuel prices to volatile stock prices to declining home values and the mortgage crisis, are putting many U.S. private clubs in a vise grip between a dwindling new member prospect list and ever-growing numbers of members on the exit roster. As a result, some clubs increasingly are open to outside-the-box thinking to generate new membership and revenue incentive programs. Some efforts, like those launched by Voss and Birmingham, Ala., multi-course owner Bill Ochsenhirt, are not revolutionary but still have proven to be effective. Others, like the Tour GCX program of co-founder Gary Rosenberg and the entire club development concept at The Presidential, are more innovative. One program devised by Voss that has been successful at several of her client clubs is what she calls a charter program. Many new clubs offer charter memberships to the first wave of members at a special rate with special privileges, but Voss clients make the program open to new members at any time and offer added value for a fast membership decision rather than reduced initiation fees. "If you join within 15 days of experiencing the club [for the first time], you get a charter membership and a whole host of ?welcome' gifts-nine guest passes, 10 lessons, a $500 pro shop credit, a raffle ticket for a trip, etc.," she said. "What I like about the program is that it expires 15 days after experiencing the club, but you put something out there that has real value and you stay away from giving away free dues." At one of her client clubs, which had a 300-person prospect list, she sent out a similar charter membership invitation to the prospects and extended the expiration deadline to 30 days. While the results were not all in, she said she believes, based on past results, that the offer will seal the deal for some of them. Ochsenhirt owns three private clubs in the Birmingham, Ala., area-Inverness Country Club, Heatherwood Country Club and Pine Tree Country Club- under the Diamond Clubs corporate entity. He said the past year has been the best ever at his flagship Inverness club, in part because he created new membership categories and recruited current members to be his sales prospecting team. Ochsenhirt said his clubs have been ahead of the curve in focusing on women, children and families. He said that his research several years ago showed that 83 percent of checks to the club were signed by women. That prompted him to implement an aggressive "Friends & Family" campaign that offered rewards for members who brought in family, friends and neighbors who became members. He believed that individuals would be more willing to socialize at the club with people they already knew and liked. Ochsenhirt also created several membership categories last October. His clubs' Sports, Sports Plus and Charter memberships are based primarily on how much golf the members think they'll play. Members can either upgrade or downgrade their membership after one year, depending upon how much golf they play and how they use the club. He said he had 68 members upgrade in the first month of the new program, while four or five elected to downgrade to the less expensive category. Since the first of this year, he said, 142 new members have joined, and over 80 of those were full members. To provide revenue and potential members, Rosenberg has identified a growing number of upscale private clubs willing to open their doors on a limited basis to non-members. Particularly visitors who fit what Rosenberg says is the GCX Tour member median profile: an experienced golfer, 37 years of age, with an annual income of more than $400,000 and a net worth approaching $2 million. Beginning in 2004 with a founding membership of 50 and four participating private clubs in the New York City metropolitan area, Tour GCX has grown to over 1,400 members and 48 participating clubs, Rosenberg said. Members buy in packs of rounds- corporate packages start at 20 rounds, while individuals can buy in three, seven or 10-round packs. The rounds aren't cheap-Rosenberg said the average cost per round to Tour GCX members is $675. Tour GCX books and pays for the tee times, which are generally in mid-week or other off-peak times, and Tour GCX members even have charging privileges at the clubs, which Tour GCX will pay and then bill members back. "We've had a relationship with them for four years, and it's been extremely beneficial for both organizations," said one participating club general manager on Long Island, N.Y., who asked to remain anonymous. "In four years, we've only had one person join, which is not a windfall, but it's bigger exposure to the club than we might normally have from garden variety outings, weddings, bar mitzvahs and things like that." One of the game's most time-honored marketing tenets is that the golf course is an ideal place to do business. Investors in The Presidential, a brand new club recently opened in Dulles, Va., minutes away from Dulles Airport outside Washington, D.C., are betting nearly $70 million that is true. The President ial, designed by Nicklaus Design veteran-gone-solo Dave Heatwole, has 18 holes open, with plans for a third nine. The membership will be strictly limited to 150 corporate members, selected on an invitation-only basis and primarily representing the top leadership of Fortune 500 companies. Corporations pay $60,000 a year to provide access for their executives and their clients. The business model is not totally unique - Fiddler's Elbow Country Club in New Jersey is a similarly all-corporate club, although memberships are less expensive at $33,000 per company and there is no membership cap. Plans are reportedly underway for The Presidential and Fiddler's Elbow to offer reciprocal playing privileges to their members in the near future.

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