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September 2019

Long-range Goals: How Technology is Driving New Revenues

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By Steve Eubanks

It’s a near universal dilemma, one almost all operators face with feelings that fluctuate from marginal concern to sheer, unadulterated panic. 

Jim Wyffels, the general manager at Spirit Hollow Golf Club in Burlington, Iowa, had to find another revenue stream, a profit center that would offset the ever-rising costs of labor, insurance, maintenance and capital expenditures. Sure, the economy has been humming for the better part of two years, but as any golf operator will tell you, rising costs, particularly in payroll and benefits, have outpaced pricing by a healthy clip. Increases in rounds have helped and there has been some upward movement in rates, fees and overall pricing. But the gap between income and expenses is only getting wider. Like everyone, Wyffels needed a creative way to lessen that squeeze.

He found it right outside his clubhouse. On the driving range.

“We have a great golf course and a very nice stay-and-play business (in the club’s eight-room lodge and accompanying cabins) but our goal was to increase the food and beverage business and also to help our lodging in the off season since we’re in Iowa, (which averages two feet of snowfall every winter),” Wyffels said. “We kept looking for ways to do a Topgolf type of thing, something that would make the driving range more of a destination, but it never made sense. Unless you’re spending an exorbitant amount of money (on infrastructure) and you’re next to a large city, those kinds of innovations are cost prohibitive.” 

But as happens with all innovation over time, the technology eventually became cheaper. No longer did an operator need to build a netted artificial range with sensors on the ground or in the golf balls. Launch monitors, some as small as an old flip phone, can now provide a wealth of data while computers simulate the flight of a ball.

Wyffels and the owners at Spirit Hollow found that they could create an entertainment experience without completely overhauling their existing range. And they could do it in a way that made economic sense in a town of 26,000 in a Midwestern farming state.

They went with the Toptracer Range system – a subsidiary of Topgolf – primarily because it was affordable and any customer who watched golf on television had seen it before. All those televised shots on the pro tours that are tracked with a tracer line while the ball speed, distance and trajectory numbers click off like gauges on a spaceship, are brought to you by Toptracer. So, the customer using the Toptracer Range has an instant connection.

But that isn’t the only product finding its way to courses around the country. FlightScope, the tracking technology company that provides the tracking and scoring data for all of tennis’ major championships, has a new product called Mevo, a miniature launch monitor (about the size of a key fob) that will connect through Bluetooth to your phone. The device then speaks to the golfer, telling him or her the distance, clubhead speed, ball speed, spin ratio, and smash factor of each shot. A customer who wants to work on wedges can have Mevo tell him exactly how far each shot flies without ever looking at a screen.

Trackman, the laptop-sized device that tour pros carry with them like luggage, is also being used for club fitting and instruction at a growing number of facilities.

But Wyffels bought into the entire experience. “Once we saw Toptracer and what it could do, we honestly thought we were going to kill it,” he said. “The only word I can use to describe it is addictive. Once you start you don’t want to leave. I had been to Topgolf facilities and seeing the lighting in the field, it’s a visually pleasing experience. So, (as we were putting in Toptracer) I started looking around to install that kind of lighting on a regular range. I found out that nobody made it. So finally I found a guy in Florida and asked him if he could make what I was looking for. He created a prototype and we installed lights on our seven targets at our range. Since then I’ve taken (the lights) to several other ranges that are using Toptracer.

“We now have LED lighted targets out in the field. Not only do you have the instant gratification and feedback (from the Toptracer system), you can play multiple games on the screens – you can play different golf courses, play points games, long drives, or you can just work on your swing with all the launch monitor data – but also, the lighted targets help us with non-golfers or new golfers. The targets light up with crazy colors so new golfers and non-golfers get instant feedback, not just on the screen, but also from the lights in the field. And it’s pretty dramatic, especially at night.” 

The transformation was immediate. Wyffels installed Toptracer Range into seven covered, climate-controlled hitting bays. To add to the experience, he added large windows between the bays and the dining room. Now, instead of a few serious players practicing when the weather is good, he has people in his facility all hours of the day and night.

“In the summer it’s in the 90s (outside) and in the winter it can be minus-22 and the Toptracer bays are still full,” he said. “It can be snowing outside and people are playing golf in sweatshirts in the (climate-controlled) bays. And they’re hitting balls down our driving range. You can see the ball flight as opposed to hitting into a simulator where the computer is telling you you’re doing one thing but you never really know. At our place, you get the feedback from Toptracer but you can also see your true ball flight.” 

Technological advances are moving faster than most operators can keep up. From tablet-based point-of-sale systems to GPS devices that monitor pace of play and cart battery life from the golf shop, most technology in golf is geared toward the expense side of the ledger – optimizing maintenance practices, efficiencies of staffing, etc. But driving range technology is not just revenue producing, it’s transformational.

As Wyffels said of Spirit Hollow: “We have 35 TVs and games (indoors) now so that our facility has become a combination of Topgolf and Dave & Buster’s. It’s an entertainment venue. If you’re eating, you can watch people play golf in the bays. What we found is that in the wintertime, 40 percent of our customers are non-golfers. But we also have a lot of low-handicap golfers utilizing the launch monitor features.

“The most exciting thing is bringing in people we’ve never seen before. Those folks who are not golfers, we’re introducing them (to the game) in some fashion. Hopefully we’ll bring in new golfers.

“Then the food and beverage operation has exploded with this. Honestly, I can’t stress enough how important that (range technology) component is to us. Once we get the people in, they don’t want to leave. They eat, drink and have a great time.”

Wyffels sells bays by the hour for $40. Most people stay longer. 

“We’ve had people come in at 8:00 in the morning to try it out and before you know it, they’ve stayed and eaten lunch and hung around until mid-afternoon,” he said. “We sell blocks of times during football season so people can bring their buddies, play different competitions on the system while they watch the (football) game.

“Then you’ve got the staff component. Especially in the Midwest, you want to utilize (your existing staff) as much as possible in the off-season. This revenue stream makes us run much more economically and efficiently in that regard.

“Until you get people in your bays trying it out, it’s difficult to explain. But once you get them in, you don’t have to sell very much.” 

The transformation is a real business driver. Not only does range usage increase, the number of people per hitting bay goes up dramatically. A normal range has one person per station. Unless a patient wife, husband or significant other is sitting behind watching, no one else occupies that space. With technology like Toptracer, each hitting bay becomes a social cluster.

The best analogy is a bowling lane. Whether it’s family, friends, coworkers and leagues, each lane is its own entertainment area. Topgolf created a similar experience. Now the same technology is transforming on-course driving ranges as well as stand-alone practice facilities. 

“When you sell the entire experience, if you change the entire range, then, absolutely, you have changed the dynamic and you will see the numbers increase,” said Henri Johnson, the founder and CEO of FlightScope. Johnson’s company originally developed 3D Doppler tracking systems for cricket and tennis in 1989. But he has seen a 300 percent growth in the business since 2016, largely because of the explosion in golf.

However, Johnson warns golf operators to be careful in how they approach the boom. “When we started FlightScope in the golf industry in 2002, we installed the technology on driving ranges in Singapore and two in Thailand,” he said. “But after two years, we abandoned that project. At the time, the technology was way ahead of its time.
 
“What I have seen is that when you have a Topgolf or a Drive Shack or a similar facility, people go there, rent the space, buy food and drink and it’s an experience. But what we found is that if you only add the technology and nothing else experientially, people will try it once, maybe twice, but then they will go back to normally hitting balls. Given a choice between hitting balls normally and paying extra to hit balls with the technology, if nothing else has changed, they will hit balls normally. 

   “But if you do change the experience, then you see a real difference. I saw one facility that had a $700,000 increase in alcohol sales in one year after adding the technology and changing the experience of the facility. Now, a lot of that is due to the fact that you are accommodating more people at the same bay at the same time. They’re consuming food and drink when they’re not hitting balls. I’m convinced that this business model works.” 
The hesitancy on the part of most operators is cost. Range balls at $10 to $20 a bucket make it hard to justify a five-figure capital outlay, possibly more if you add onto dining facilities or put LED lights on your range. But those who have taken the plunge on a smaller scale are just as enthusiastic as those who have gone all in.

“Driving ranges typically don’t make a huge profit,” said Jim Swafford, owner of Ultimate Drive in Bakersfield, California. “This being a commercial driving range, we needed to do something to attract more customers, so we introduced the new technology. In the second month, we started turning a profit.

“Our initial investment was about $15,000. You have to make sure the lighting is right and we’ve made other improvements. But it’s been a profit center almost from the beginning. We’re seeing couples coming out for date nights. Every Tuesday night we have two-man teams and they’re playing other two-man teams in a bay. It’s like a bowling league. They have shirts and trophies. It’s really cool. They play nine holes virtually every Tuesday night. We have long-drive competitions. It changes the way a golfer looks at the game.”

Cindy Scardina, who co-owns Green Valley Golf Range in suburban Chicago with her father and siblings, said, “We were the third range (in the country) to install Toptracer Range in May 2018. We started with 10 bays. We’ve now increased to 20 bays. It has transformed our range into an entertainment environment. You have the good golfers bringing their families out now. The wives and kids used to never come out unless they were playing miniature golf while the husband hit balls and practiced. Now they’re all together, playing games and enjoying the range. It’s an event. It’s totally different.

“For new range owners, it’s a no-brainer. But, I understand that for those who have owned a small business for a long time, it’s daunting and overwhelming because you’re being asked to change your mindset of what golf used to be.

“We’ve been in business for 50 years. My dad started this golf range in 1969 and we grew up understanding that you had to be quiet all the time because people were practicing. Now, that’s not what the game is about. Sometimes people get their backs up and say, ‘No, no, we’re a good practice facility and we can’t have the music and all that.’ But if you want to grow it’s what you have to do.

“We’ve seen our business grow 30 percent,” Scardina said. “And we don’t have a big food and beverage operation, just a small concession. To grow 30 percent in a year is huge for us. And we only see it going up from there.”  
 
Steve Eubanks is an Atlanta-based freelance writer and New York Times bestselling author.

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