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Well, changed my life may be a bit strong, especially since it was just the beginning and it took 6 more years for me to really understand what we had done.
It was 2005 and the Final Four was coming to St. Louis, I remember vividly because my beloved Tar Heels won that year. They beat Illinois in a great match-up, I was there to witness it. Anyway in 2005 I was the Head Pro at Gateway National Golf Links, a links style golf course located just 5 minutes from downtown St. Louis with views of the St. Louis Arch from the course. My boss and I were sitting in my office trying to figure out how to best get all we could out of the upcoming Final Four weekend. I had already ordered all the apparel with the Final Four logo and it was starting to sell. We knew, with the basketball games falling in the evening we would surely be busy over the weekend. We decided, after much debate we would raise all our prices by a staggering $15. Both of us almost talked the other out of it a few dozen times.
As we expected, we started getting phone calls for that weekend and we started quoting the price, “Our price that day sir is, um, $85”, normally we charged $70 if you struggle with math the way I do. We were only nervous the first couple times because what we found was we could have been charging $100. Nobody cared what the price was. They just wanted to play and we ended up selling out the entire weekend. Thinking back, even though we raised the price we still left money on the table! If we were truly utilizing dynamic pricing like we are today we would have made a lot more money, but for 2005 that we pretty forward thinking.
Long story short, what we were left with was the thought, how can we get more events like that to St. Louis? Pretty stupid, huh? What we should have thought, and what we think today is it doesn’t take an event like that to take advantage of demand. Even if you only experience high demand for 2 hours per day, are you charging enough. Are you even positioned to take advantage of the demand?
Dynamic pricing has been around for years, used in the hotel, rental car and airline industry. Most recently, many teams in Major League Baseball have adopted the methodology. As usual, the golf industry has been slow to react to the powerful pricing strategy. Every course has day parts, or segments of their day where they see high demand. But instead of taking advantage of those instances they just set their rate and forget it. “It’s almost spring, time to set our rates for the next 9 months”, sound familiar? Well no more, imagine a world where your rates can fluctuate as much demand… up and down. Imagine a team dedicated to evaluating demand every day, multiple times per day, and setting your prices accordingly. Your number one revenue source is greens fees and cart fees, it deserves the proper attention, not just a couple times a year.
When you have a team focused on selling your golf, not just waiting for golf to sell the sky is the limit.
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