The Pellucid Perspective - September 2011 - (Page 7)

RATE CARD PROMOTION Promoting rounds at rate card — a novel concept? A “social” way to avoid discounting By Harvey Silverman and Jim Koppenhaver e’ve written twice before about the meteoric rise of daily deal sites, particularly as they relate to the golf industry. They seem to be sprouting like poa annua on a California green. In the wake of this dizzying and changing landscape of service providers and offerings, conversations on places like the NGCOA ListServ and LinkedIn are similarly expanding exponentially, sharing in-market experiences, results and discussing the pros and cons of this new tool to generate revenue and attract new customers. The more we read and hear, however, the more we wonder: What happened to selling at rate card, and is the world of digital and social marketing completely constrained to be simply a vehicle for promoting discounted golf? The daily deal business model is under much scrutiny and analysis from everyone who considers themselves a business expert. There are some clear facts: Groupon, the originator and biggest of them all, has not made a nickel of net profit and recently delayed its IPO, citing “market volatility” (my small portfolio can attest to that), but you have to wonder if it’s more than that. Facebook tested and withdrew from the daily deal market, saying in effect that they did not see it as a good option for businesses (read: big discounts do not a profit make). And notably, 134 daily deal sites opened in the past year while 136 closed. In golf, a Google search found 10 daily deal sites selling tee times and/or equipment: Group Golfer, DoGolf, Golf Rodeo, Divot, Chip On Deals, Golf On, Deal a Day Golf, The Sand Trap. Also, GolfNow has its own daily deal site, Deal Caddy; and there’s Golf Deal Depot, being heavily promoted by Andrew Wood of Legendary Marketing fame. This plethora of service providers for a single niche within the modest golf industry reinforces Stuart Lindsay’s observation at the Pellucid State of the Industry presentation that this model is easily copied with very low barriers to entry. (Actually, Stuart’s words were more like, “Any idiot can do this”). Add to the daily deal sites the numerous third-party tee time providers and distributors that display discounts and it seems that selling tee times at rate card has become a novel concept. If one looks at the basic formula for the daily deal business model, it consists of 3 elements: 1) The cost efficiency of recruiting and maintaining a digital audience interested in your content; 2) Leveraging the social nature of human beings and giving them an easy way to share their influence over family & friends when motivated; and 3) A “great deal” or what they believe will be a relevant experience to that person at a too-good-to-pass-up price. Given that the benefits of digital audience efficiency and www.PellucidcorP.com W leveraging social interactions still have a considerable number of unexplored applications, it made us wonder, “What if someone could create a service for golf that would be the “Un-Groupon”? In other words, is there potentially (no, likely) a service that could create audiences of golfers willing to share their great experiences with others to influence them to play courses delivering a solid value experience without the discount reliance? If we keep dreaming, wouldn’t it be optimal if this service provider structured their compensation on a commission basis as a percentage of the revenue of rate card rounds sold? Now that we’ve got your attention, let’s explore this hypothetical world. There are several keys to making this work. First, we have to find the people who had a great experience at the course. While we’re generally interested in both the positive and critical feedback, here we’re specifically zeroing in on the people who would be advocates (i.e. I’d recommend this course to a friend). Potentially it’s embedded in the follow-up email to new customers and the recurring email you send to existing customers (what, you’re not doing that? Well, start!). While we’re not sure of all the executional details, it could be a brief sentence (I had a great time here, you should check it out!), possibly a thumbnail image of the course and the hyperlink to the online tee times engine that they could post to their Facebook page or send individually to their friends. You’d need some way to “tag” the entry to the online tee times booking engine that identifies the source of this inbound customer, in order to track on the back end how many rounds were attributed for payment purposes on the commission schedule. While we know it’s not perfect and it’s far from fully baked, there are glimpses in other industries that digital/social can be used for things other than distributing discounts. There is currently a mobile phone app that lets you scan local restaurants and see comments specific to those places from people in your network. So, instead of relying on the syndicated reviews of services (Trip Advisor, Angie’s List etc.) or the random thoughts of strangers (“Mike H liked this restaurant!” but does Mike H have good taste and is he Italian?), people are plugging into people in their social network whose tastes (or lack thereof ) are known and with whom they relate. Nowhere in that equation was selecting that restaurant because of a deep discount or having the cheapest food in town (unless it’s all college kids and then it’s pretty much all about volume of food and the size of the tab). Our point here is that, from a business owner’s perspective, (See Rate Card Promotion on page 15) The Pellucid PersPecTive 7 http://WWW.PELLUCIDCORP.COM

Table of Contents for the Digital Edition of The Pellucid Perspective - September 2011

The Pellucid Perspective - September 2011
Contents
The China syndrome
Shift happens: The impact of Hispanic growth on local golf markets
Promoting rounds at rate card — a novel concept?
Promoting rounds at rate card — a novel concept?
There’s golf in them thar’ (sand) hills
August weather impact, July utilization
Seattle, WA Core Business Statistical Area (CBSA)
Seattle, WA Core Business Statistical Area (CBSA)
The long and the short of it

The Pellucid Perspective - September 2011