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E-Newsletter Archive: July-August 2002

IN THIS ISSUE:

The news:
Calling all ranges: Best New Range Award entries due Oct. 11
AMF ends contract with Michael Jordan, sells golf centers
Industry research available on new Golf 20/20 Web site

Business insider:
Don’t be stingy when planning your marketing budget. Spending 10 percent of your sales on advertising and promotional activities is an investment in the facility with profitable returns.

The magazine:
Joe Salemi is betting on more than beginner’s luck to drive success at his first golf facility, Boulder Creek Golf Club, which received an honorable mention in Golf Range Times’ 2001 Best New Range contest.

Call for Entries: 2002 Best New Range Award
Did you open, purchase or upgrade your range in 2000 or 2001? Or is your range operating under new management? If so, it may be a contender for the 2002 Golf Range Times Best New Range Award. In the past eight years, Golf Range Times has recognized 37 driving ranges for their outstanding design and facility features. Yours could be next. Fill out the entry form in the July/August issue of the magazine or download a form here. The award winner, runners-up and honorable mentions will be announced in the January/February 2003 issue of the magazine. Deadline for entries is Oct. 11.

AMF Sells Michael Jordan Golf Centers: Charlotte Reopens; Chicago Shuttered
AMF Bowling Worldwide Inc. has divested itself of the Michael Jordan Golf Co., which operated two driving range facilities in Aurora, Ill., and Charlotte, N.C., up until earlier this year. The decision by AMF, which recently emerged from Chapter 11, came down to a desire to concentrate on its core business. As part of the bankruptcy agreement, AMF also ended its personal services contract with Michael Jordan, who had lent his name and image to AMF promotions. According to Merrell Wreden, vice president of corporate affairs with AMF, based in Mechanicsville, Va., the Michael Jordan Golf Center in the Chicago suburbs has been closed. The facility had been operating on property leased from the city, and Wreden noted that renewal would likely be an expensive proposition for would-be range operators. Prospects are considerably brighter for the Charlotte golf center, which reopened in early July as Leatherman Golf Learning Center. New owner Chris Leatherman is a PGA professional who served as director of instruction for the facility during the three years it was owned by AMF. Read about Leatherman’s plans for the center in the July/August issue of Golf Range Times.

Golf 20/20 Launches Web Site
Golf 20/20, the industry organization dedicated to enhancing the growth of the game, is online at www.golf2020.com. The site contains information on the organization’s initiatives including programs focused on juniors and player development as well as an area where visitors can express their opinions about Golf 20/20’s efforts or share ideas. Also available are the findings of Golf 20/20’s research projects during the past two years including a report on the importance of alternative golf facilities in the growth of the game.


Calculating Your Marketing Budget
Believe it or not, there are some range operators who actually believe that they don’t need to market their facility. They fall into the category we call “build it and they will come.” That’s bogus. Although there are exceptions to every rule, you had better be swimming in profits before you adopt that mindset. One thing is certain in this business: Marketing is directly related to sales. You maximize sales by spending money on marketing, not by downplaying its importance. Marketing is an investment, not an expense.

And, it’s more than the ads that you run on TV and radio or in newspapers and the Yellow Pages. Marketing also includes activities such as

—freebies (trinkets, food, etc.) that you give away,
—local events/shows that you go to,
—mail that you send to your customers,
—coupons that you give out and
—your Web site.

Given its comprehensive nature, you may be wondering how much to allocate for marketing. Generally speaking, you should spend 4 to 10 percent of your gross sales on marketing activities. So an average range doing $200,000 a year would spend $20,000. Some high-volume ranges will spend $75,000 or more annually. And when you consider that coupons and your Web site incur additional costs such as postage and maintenance fees, $20,000 doesn’t go very far—it just covers some of the essentials that you have to do to stay in business and compete.

You also may find that you need to spend more or less money depending on your location and the facility’s features. Factors that will influence your budget include:

—Competition: The more competitive your market, the more you’ll need to spend.

—Location: A good location provides you with great visibility and permanent advertising. The worse your location and visibility, the more you’ll need to spend.

—Age of the facility: If your facility is new, you’ll need to spend more to make people aware of its existence. It can take 3-5 years to generate decent awareness levels for a facility. Even after that you need to market because people leave the area and new residents come in who have never heard of you.

—Target market: You may be trying to reach more than just golfers. If you offer a variety of amenities with broad appeal, you’ll need to spend more to make the larger market aware of your facility. A good example would be a facility with a golf range (narrow target) and a miniature golf course (broad appeal).

—Market type: If you’re located in a large, well-developed urban market, you may be faced with higher costs to place ads in print, radio, TV, Yellow Pages, etc. Generally, the larger the market, the more it costs to reach its residents.

One final comment: When sales are slow and you’re looking for ways to generate cash, don’t cut back on marketing, increase it. When you reduce your marketing activities, you reduce your exposure, which costs you more in lost sales—and profit.

Boulder Creek Golf Club: Getting It Right the First Time
Joe Salemi knows a prime piece of property when he sees one—even if he sees it from several hundred feet above. Salemi, owner of a Cleveland-based excavation and construction company, long ago diversified into real estate, building subdivisions and developing rental properties. It’s only recently that he’s turned his attention to the golf industry, building his first practice facility on land he spotted while flying his plane over the wilds of Ohio. Already, the facility, which received an honorable mention in the Golf Range Times 2001 Best New Range contest, is getting rave reviews from industry insiders, and it’s not even complete.

Find out why Boulder Creek is the talk of Ohio and read about Salemi’s plans for expanding the facility in the July/August issue of Golf Range Times.

Also in the July/August issue:

—Getting parents and kids into the swing of things with birthday parties
—A look at sports bars on the range and how facilities are making these amenities family friendly
—Advice for gaining the good will of your community by sponsoring fund-raisers

Plus, industry news, new products available in the marketplace, strategies for building a miniature golf clientele and a product roundup of ball washers and dispensers.


About the Golf Range Times e-Newsletter
The Golf Range Times e-Newsletter is a free bimonthly publication sent to range owners and developers who have provided e-mail addresses. You can subscribe online here.

Don't hesitate to forward a copy of this newsletter to friends and associates or to let them know that they can subscribe at www.golfrangetimes.com.

Have a tip or idea?
Contact Marshall Norton Jr., Golf Range Times managing editor, at 804-272-9100, ext. 112, or by e-mail at marshall.norton@douglasmurphy.com.


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