Golf Industry Central Autumn 2012 - Page 25

Unique Selling Points Revenue Management For Clubs Revenue Management (Yield Management) has been used within the hotel industry for decades as a way to maximise occupancy year round. So in this ever demanding and competitive industry of ours, how can we adapt to the principals of Revenue Management into our Clubs Business & Marketing plans and ultimately our Clubs Culture to maximise our occupancy year round? Here are three key principals for you to consider as a way of understanding how your Club can adapt to this management concept: 1. Know your Members & Customers - an in depth understanding of their trends and behaviours is paramount. Clubs must understand the movements of their members and customer before marketing. 2. Forecasting - tied closely with point one, however forecasting starts with the vast collation of business data and predicting your Clubs trends for specific periods. For example, understanding what your function room occupancy rates are and targeting the quieter days such as Monday or Sunday evenings. Clubs must not over sell and under deliver! 3. Price Discriminate - not all customers will be prepared to pay a premium for your products and services all year round, so target your quieter periods to a new market of customers. When promoting to this new market, promote value, promote quality and promote yourself, this is a great way to get people through your doors and when done correctly, you will convert the thrifty customers into loyal customers who are willing to pay full tote for your products and services. To put the principals into context for you, The Eastern Golf Club went from having 65% occupancy on their time sheets, to 80% occupancy through following these principals, how? 1. The Club willing to pay full tote for your there is a large demand for social golf in the market, especially on private golf courses. By Peter Vlahandreas 2. Through forecasting, the Club had an in depth understanding of the days which could accommodate the extra players on the course with minimal impact to their members playing routines. In addition the Club had also conducted In addition the Club had also to understand exactly how many extra players they could fit in without compromising or adding to adding to their staff resourcing, whilst still providing the service which the Club was renowned for. 3. The Club knew that in order to get maximum exposure and traffic through their doors, that the price point had to represent value as a way of getting the new customers to purchase and allow the Club to have an opportunity to wow as many new guests as possible at the club. Another example is the increase in catering options and days for our members whereby we followed the same three step process: 1. The Club knows that there is 22% of members who are of an Asian ethnicity who regularly visit local restaurants, instead of frequenting the clubs lounge for lunch. 2. The Club forecasted that if we could attract just half of these members that the catering department could justify two things: One, a change in menu options to cater for our Asian members and Two, opening the kitchen on Thursdays (as this is primarily when our Asian members play socially with their guests) 3. We undertook some market research to understand Asian restaurant price points and found that the majority of lunch options in the local area were under the $10 price point. From this data, we then priced our new menu accordingly. Our final example of using the theory of Revenue Management into practice is our Membership Options at the Club, and more specifically our six month Introductory Membership: 1. We took the time to understand that the current golfing market wanted a low entry price structure in order for them to commit to a private golf club environment. This structure must include at least one day on the weekend (in order to appeal to the young professional/ family market) and it must be obligation free , so that if the members circumstances change (such as work or family commitments) then they can walk away. 2. Our time sheet had sufficient room for extra players, especially on Sunday afternoons and non competition days and increasing our six day playing membership by even 50% we would still be able to offer the same level of services to our members without additional labour resourcing. 3. Our price point is very competitive, just over $4 a day ($745 all inclusive of GV fees, Insurance and $50 House Levy) for six months with six day playing rights. After this period, if the new member would like to join as a playing member then their entrance fee is reduce by 61% ($610) and fees are paid pro-rata. Since beginning this membership category, we have had a conversion rate of over 50% Into a playing category. Which proves the theory principals and that if you as a Club promote value, promote quality and promote yourself, in order to get new people through your doors then you will convert these customers into loyal members of your Club. In summary, The Eastern Golf Club allowed itself with an opportunity to wow new markets of golfers its Club whilst significantly increasing their bottom line, Clubhouse and Golf Shop traffic and converted numerous new members into loyal promoters of the Club through these Revenue Management Principals. Golf Industry Central Autumn 2012 23