The Pellucid Perspective - July 2013 - (Page 5)

GOLF COURSE TECHNOLOGY An inside look at the Fore!-GolfNow deal Big deal, big data, big potential, big risk By Stuart Lindsay [Editor’s note] Stuart Lindsay is the founder and principal of Edgehill Consulting and a frequent collaborator with Pellucid Corp. in a wide range of data gathering and analysis and golf industry customer marketing projects. He has also worked extensively with FORE! Reservations and its founder, Harry Ipema, for many years. The following is an insider’s analysis of the recent purchase of FORE! Reservations by GolfNow. “T he guys at Edgehill and Pellucid are better at dissecting our data and generating meaningful reports than we are” – Harry Ipema, CEO and Founder, Fore! Reservations, Inc. Harry called me a couple hours after he announced the sale of Fore! Reservations to GolfNow to his employees. I also spent a day with Harry a week later. Jim Koppenhaver and I were also asked to spend some time with the people at GolfNow and recently spent a day in Orlando (with Harvey Silverman on conference) getting an update on how they envision incorporating Fore! into their operations. Because Pellucid and Edgehill have had both Fore! and GolfNow as clients, we have a rather unique inside perspective regarding the operations of both companies. I can assure all of you that there is a lot more to this picture than meets the eye. The reasons for Harry’s willingness to sell are complicated. Fore!’s availability seems to have caught GolfNow somewhat by surprise – they were already working on their own software platform – but the reach and potential of Fore!’s footprint in the industry presented too big an opportunity to pass up. The integration of Fore! into GolfNow is also complicated and may help explain what many have commented has been a poor PR effort in announcing the acquisition. Since the announcement on June 3rd, I have received countless phone calls from clients and other industry stakeholders – most of whom know that we have done extensive work dissecting data from the suite of Fore! software products. We should also point out that we have dissected the data file structures for Active (GEN, Jencess and Fairway), Club Prophet, Crescent, EZLinks, IBS, Jonas and Visual One and have been tracking general technology use in the golf industry for over 20 years. In our quest to stay current, we have also done research on some of the newer systems based on “cloud technology” such as ForeUp, TeeOn and TeeLeader. GolfNow also revealed in our meeting that they have been pursuing a “cloud based” tee sheet and POS solution (G1). Because the data mining we have done over the past decade has focused on customer acquisition, retention and value, we probably have the best idea of how big the Fore! footprint actually is – and it is big. With the vast amount of information involved, this merger could impact virtually everyone involved in operating golf courses in the US and Canada. This is not just a fork in the road, but a major crossroads. If GolfNow and the Golf Channel properly and cooperatively harness this information and the capabilities of Fore! software, they could do an immense amount of good things for golfers and help make their golf course customers better marketers, which will benefit even their competitors. On the flip side, if they handle this merger too aggressively and focus on certain objectives they have emphasized in the past, this combination could end up doing a tremendous amount of harm to golf course operators – both those that use their services and those that don’t. Our data mining also gives us a very accurate picture of how customer information can be used to analyze marketing effectiveness. For our clients using GolfNow, we regularly review the redemption rate for their barter times and how much of their own inventory is being sold to golfers originating on the GolfNow website. We have seen losers, marginal winners and some big winners. In the process, we have seen pricing mistakes and customer contact information mis-handling on both the golf course and GolfNow sides of the ledger. The use of the customer transaction history data makes this easy on the Fore! platform, but is considerably more difficult, and often impossible, on some other platforms The people calling me are also aware that I, like Harry, have been an outspoken critic of GolfNow. While that is true, they forget that I wrote an article on their original acquisition of Cypress and basically outlined how they would get their money’s worth and more from what I deemed a smart business move on their part. My criticisms have been based on the barter business model and some questionable customer data handling issues With the vast amount of information involved, this merger could impact virtually everyone involved in operating golf courses in the US and Canada. This is not just a fork in the road, but a major crossroads. The Pellucid PersPecTive 5 http://WWW.PELLUCIDCORP.COM

Table of Contents for the Digital Edition of The Pellucid Perspective - July 2013

The Pellucid Perspective - July 2013
GolfNow buys FORE! Reservations
An inside look at the Fore!-GolfNow deal
FORE! Reservations sells to GolfNow? Preposterous!
PGA of America, Tour (reluctantly) accept anchoring rule
An ominous April for equipment sales
Pace of play campaign picking up speed
June golf weather impact: Flat, but encouraging
Boomers boost Sunshine State market, but clouds looming on the horizon
Cliffs Communities emerge from bankruptcy, Tiger’s course still on hold
Golf fights back, finally

The Pellucid Perspective - July 2013