All too many clubs have misread the signals. Faced with declining participation or a lack of prospective members, they responded by reducing services, cutting the initiation fee or opening up to non-members. Rather than hear a clarion call for evolving and adapting, they acted as if there was no way to stop members from going elsewhere for dinner or that young people no longer want to belong to clubs. In their haste to do something quick, they have often behaved in ways that undermined the value of membership as opposed to taking meaningful steps to enhance it.
There are too many club success stories that tell us otherwise, however. The desire among people to bond together in common purpose and enjoy the company of like-minded individuals is strong and enduring. It will continue to be present in society in the future. The challenges of declining usage or lack of demand for membership aren’t signals that the situation is terminal; they are requests for something new and different. Existing and prospective members are more selective and judgmental than in the past because they have more choices and more demands on their time than ever before, and because they are often funding the membership from their own pocket. As a result, the experience must suit their lifestyle or they will simply pass it up.
Though the club industry is broadly categorized in the press and other corners as being in crisis, it is more correctly one of differential success. The winners in this battle are the clubs that have adapted to modern lifestyles. The recession that followed the 2008 financial meltdown has had significant impact on the American psyche. From spending habits to perceptions of once respected institutions like banks and insurers and clubs, our view on what is safe and important has changed. The industry undoubtedly took a hit, but some six years after the fall, a new private club community is emerging.
Strategic Pillars for Club Success
As we move into 2014, patterns are beginning to form. Clubs with enlightened leaders are making changes to their facilities and programs that attract the new members in their marketplace. They also entice members at clubs that are struggling to step up to a more fulfilling membership experience. This battle for market share is playing out all across the country. They are building these success stories on the strategic pillars of safety and security, family, health and wellness and good old-fashioned fun.
While the promise of club membership includes ready access to premier facilities and programs, its preeminent roles are as a safe haven for developing meaningful relationships with others and as a refuge for family bonding activities. While the importance of activities will ebb and flow—in the past 30 years we’ve seen a tennis boom, a golf boom and now a fitness boom—people-based core values never go out of style. The club’s facilities are often sitting there as venues that could drive the types of meaningful interactions that bond members together and to the club if given the right amount of energy and innovation.
There is no doubt that people have become more cautious and value-conscious in the wake of the financial meltdown, but this shouldn’t be misinterpreted as an unwillingness to part with a dollar. What they are willing to spend money on has changed, however, with the new emphases being special experiences. They are paying up for food at Whole Foods because they are more aware of the relationship between what they consume and their health. It makes them feel better emotionally and physically. They are taking trips that are educational and enlightening. They are willing to pay more for these types of things because they are emotionally fulfilling. The attitude is more a quest for special experiences than simple activities. There is a world of opportunity in these new desires and smart clubs are stepping up.
Clubs can respond in intelligent ways. The stuffy old club dining room of the past isn’t working, but members are using lively pubs and grills. They want resort-like outdoor settings and they line up for special experiences like chef’s table. They are pursuing good health and they’d love the opportunity to participate in this kind of activity with fellow members. Programming is rising in importance and smart leaders are developing new and interesting ways to draw members to the club.
Members are also seeking greater value through year-round use. One of the biggest barriers to joining remains time-constraints, which need to be overcome with innovative programs and facilities. Golf learning centers that provide enhanced skill development in and out of season are ideal for the club golfer who wants something more. These are the types of new facilities that are providing the experiences that members are willing to pay for. This combination of new facilities and interesting experiences is what clubs need to provide to overcome the reticence among people in society—especially the young—to step up to membership. When these things are cloaked in elements of history and tradition, the sale is more readily made.
Creating a Special Club Experience
In a rush to create self-proclaimed creative marketing plans, some clubs lose sight of the bigger picture. The primary way to attract members to your club is to offer an experience that has real value. The experience must be different and special and regularly re-worked to make it better all the time. Once you have an offering that is compelling, support it with the sort of sophisticated recruitment tactics you’d find in other high-end luxury retail and resort promotion. Think Brooks Brothers, not Jos. A. Banks. Focus on the lifestyle benefits. Help prospects picture how membership will enrich their life or help them achieve other personal goals. It’s not about the price, it’s about the value.
The successful clubs of the future will be those that create effective balance between respect for their traditions and more traditional members while addressing the new demands. For illustration and inspiration, look to clubs like Baltusrol and the Union League of Philadelphia. Both have one foot solidly in both camps.
Baltusrol, a purist golfer’s club, recently built a golf learning center that clearly signals the club will adapt its golf offering to reflect the increased demand for practice, training and fitness while, at the same time, responding to the demand for fitness facilities in the private club setting.
The Union League of Philadelphia is a master of balancing club tradition with evolving member demands. They respect the club’s heritage through the care and investment in the Lincoln Library and vast collection of historical artifacts, but the dining experience is contemporary and exceptional, making it a modern value. These are just some of the great examples of clubs that have built a thoroughly modern experience while staying true to their core values and traditions.
The Appeal of Private Clubs
Clubs must recognize that they are in the luxury end of the recreational and entertainment market. Many have gotten in trouble in recent years by trying to cut their way to prosperity. Instead of going that direction, enlightened leaders will identify ways to customize the offering so it draws members to the club for a varied set of experiences.
A focus on the family will broaden the appeal and increase capture rates. Adding enrichment activities and innovative programs will keep both adults in the household coming back. People are still interested in belonging to clubs today and they will want to join them in the future, but only if it suits their lifestyle. What they’re doing or eating may be different, but the basic desire among people to join and gather together with others hasn’t changed, and it won’t.
Frank Vain is president of McMahon Group, Inc., a premier full-service, private club consulting firm serving more than 1,600 private clubs around the world. He also serves as a director of NCA and chairs the Communications Committee. He can be reached at [email protected]. For more information, visit www.mcmahongroup.com.