’16 NGF Golf Participation:
Change the Metrics, Change the Optics
Unless you’ve been hiding under a rock recently or don’t get any of the half dozen industry periodicals, you’ve likely noticed the allied industry associations’ attempts to reframe the facts of declining golf participation into one of two storylines: “It’s not that bad” or “It’s really growth in disguise.” While this is not necessarily unexpected behavior for those charged with being the industry “cheerleaders,” they’re going above and beyond historical efforts by trying to change the narrative on three fronts as support for their argument that declining participation is not an issue. In this issue, I’ll cover the three dimensions of their assault on reality and why their support doesn’t hold water for informed, thinking industry stakeholders:
- Let's minimize our back door exposure perception – We’ve pointed out in multiple State of the Industry presentations that the growing share of Casual golfers (<9 rds/yr) exposes us to significant defection risk. Several years ago, NGF switched to a new attitudinal segmentation from “involvement by rounds” to “involvement by love.” By changing to an attitudinal segmentation, they attempt to change the conversation from “we’re losing low and moderate frequency golfers” to “we’re losing people who didn’t really care about the sport, regardless of their frequency”
- Let's inflate and hype our front door “success” – In the 2017 US Participation Report, I note that the NGF headlines with the number of beginners (first round ever in previous year) and latent demand as dramatically expanding while “burying” the 1% decline in participation to paragraph 3 of the report. Additionally, if you look at the growth rates of latent demand vs. beginners, you would also see that the conversion rate must be declining over the past 5 years (oops)
- Let's create the bigger tent argument of “engagement” vs. “participation” – With all the press and excitement that TopGolf has generated in the golf and general media, it was inevitable that the industry powers would find a story to tap into this buzz. The emerging storyline is that golf is developing a “virtual” channel that is incremental and an on-ramp to the traditional game and industry. All we need now is some proof that either virtual golf begets traditional golf or that more industry stakeholders will benefit from virtual golf than just TopGolf investors
To be clear, I’m not saying that as an industry we should ignore the TopGolf phenomenon; some number of people are being exposed to golf through this medium and the number of facilities and geographies reached is going to expand in the foreseeable future. There are a couple key figures missing from this puzzle however which need to be discovered; how many unique guests is TopGolf hosting annually (they only publish visitors and fluff like number of balls hit etc.), what is the conversion rate of those unique guests to rounds-playing golfers and what is the Yr 2 retention rate of those converts? I’ll address these and the nagging question about why there aren’t more TopGolf/local course alliances out there in the If I Were King section of this issue. The other inconvenient fact in the “emergence of virtual golf” storyline is that, if it plays out like the eCommerce shift in retailing (i.e. it simply cannibalizes the legacy providers), we’ll need even fewer of those golf facilities that NGF insisted we needed back in the 90s. Is that really the industry future state to which we aspire?
For our subscribers, read on for my take on the supporting fact and color commentary. For our Executive Summary recipients, you can get the rest of the story one of three ways (all can be previewed and purchased at Pellucid's website (www.pellucidcorp.com):
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