While cognizant of the personal tragedies and economic havoc brought about by the COVID-19 pandemic, the reality is that it has been the best thing to happen to private country clubs and gated communities in the past 20 years. As the world moved at warp speed to create a vaccine for the new virus, COVID-19 cured the lingering illness that has been plaguing clubs for decades: Irrelevance. They took on a different character by returning to their roots as a private member enclave. It is amazing how well it worked, and it provides a template for how clubs should position themselves going forward.
Quarantine and the subsequent disruption of the annual calendar make it difficult to recall what things were like at the beginning of the year, so it is worth remembering the litany of challenges club leaders faced going into 2020. In a perverse way, things were too good, and the big challenge was getting members’ attention in a booming economy. Between 24/7 work and family activities for the younger set and cheap and easy travel for the older generation, members and prospects found it increasingly difficult to find value in membership. Clubs faced unprecedented levels of competition from a culinary explosion that gave people access to wonderful foods and beverages in all types of settings and price points. In addition to commercial hot spots, there was a spate of new clubs and club-like concepts whose new age facilities and relaxed rules proved popular with young people. Golf rounds, which peaked in 2003, remained in decline, especially among the younger generation, eliminating one of the primary reasons to join a country club. To top it all off, the economy made it nearly impossible to find and keep staff in a near zero unemployment environment.
THE SAFE HAVEN
Following the unsettling days of quarantine, country clubs and gated communities were suddenly popular again. In a McMahon Group Pulse Survey taken during summer 2020, 96% of respondents indicated their members perceived their club to be a safe haven. Ninety-seven percent noted high participation levels in golf and 61% reported that racquet sports were more popular than ever. Clubs also faced far fewer competitive outlets and the lack of travel options brought back the “staycation.” To protect their members and staff, and due to lack of demand or local rules, most clubs eliminated group activities and outside events. Many also eliminated or greatly reduced guest access.
Instead of losing members after making these changes, many clubs saw increases. Members were appreciative to have any social or recreational outlet, especially one that felt safe and secure. Despite simplifying their operating schedule and restructuring their programming, activities were wildly popular. Importantly, members received better service because they needed tee times and reservations to be on property, even at the pool. This made it easier for the staff to be effective as they knew who and how many people were going to be at the club that day. That streamlined and refocused staff was in better shape to do their job because they were not distracted by wedding planning or tired from putting in overtime during the Monday outing.
Managers reported how much members appreciated the new environment. While Jim Sutton, CCM, at Country Club of Charleston and his staff did a lot of things to create a better member experience, one of the more frequent positive comments he heard was on parking availability due to the lack of banquets. The club seemed more accessible and private. Joe Bendy, CCM, CCE, COO and general manager of River Oaks Country Club in Houston, where very large events are commonplace, took the opportunity of space and staff availability to start new, simpler member programs like burger night on the patio and Taco Tuesday on the Terrace, all to rave reviews. We learned that “over the top” may be just that.
MEMBER-CENTRIC CLUBS
Of all the ways we could describe 2020—many of which are unprintable in a professional publication—it created the “Year of the Member.” Taking a cue from Former Obama Administration Chief of Staff Rahm Emanuel, club leaders should not let this crisis go to waste. While clubs were forced into a member-centric operating model due to COVID-19, they should use the lessons learned to make it an intentional part of their strategy for 2021 and beyond. When the crisis passes, something that now seems possible by the end of 2021, people will be ready to spend money and get back to living. Unlike other recessions where households emerge with limited resources, many people, particularly the affluent, have increased their net worth during this time. Clubs must plan now so they are ready to compete when people again start travelling for vacations or business and they get back to attending concerts and sporting events. Unless they adopt lessons from this period, clubs will find themselves struggling for attention in the years ahead.
This is the time for clubs to clarify their priorities, effectively doubling down on their member focus. Anecdotal comments on financial performance, and validation from our friends at Club Benchmarking, indicate all those supposed revenue generating activities did more on the revenue side than they did to generate net income. More importantly, they drained energy and focus. Doing the things to keep members happy and satisfied and generating more “whole-dollar” dues and fees is the path to success and sustainability.
This period has accelerated the major trends that already exist in society. Remarkably, changes that would have taken years have occurred in a matter of months. The other interesting aspect of this is that most of these align with the value set of the millennials, accelerating the impact this group will have in society. Since the leading age of this cohort is now entering their prime joining years (ages 35 to 45), positioning your club to serve this group is essential to sustainability.
Many of these trends present opportunities for clubs. Work from home, which is likely to morph into a blended environment of partial home and office use, is here to stay. This gives people much more flex time as they shift when they work and play to suit their needs and eliminate commutes. The pandemic has also pushed the adoption of new technologies. While Zoom meetings have their drawbacks, they will be part of the meeting environment going forward. People want customized communications and ease of use, both hallmarks of tech-assisted communications. Harvard Club of Boston is starting to use artificial intelligence to track how their members use the club and where they spend their money.
THE NEW HOME AWAY FROM HOME
Finally, COVID-19 has transformed the home, which means the club facilities, a member’s home away from home, also needs to be transformed. Country clubs must transform from special occasion places to relaxed, multi-dimensional settings for daily life. This could be in a casual indoor or outdoor bar or dining space, sitting around a firepit, doing some work in the club café or taking away chef prepared meals from the club shop.
The pandemic has created an historic opportunity for the game of golf. It has reduced time constraints and other factors that have been limited participation for years. The professional team and Golf Committee should use the insights from the 2020 season to reinvent their golf program. While some data suggest the 2020 surge has been driven by the more frequent players playing even more frequently, there is also evidence it has opened the game to new participants, namely young people and women. The industry must continue to eliminate the barriers that have tended to discourage these groups. Innovative programs like the one developed by Joe Schwent, PGA, at Country Club of St. Albans includes all the right elements. It features a plan to understand each player’s goals, free lessons to increase performance, engagement and enjoyment, reasonable pricing for events and above all else, fun. This foundation was in place for years, but it is built for these times. Under the cover of COVID-19, club leaders should take the opportunity to focus on the member experience, reduce the distractions and stop chasing commercial activities. The focus must be to build value in the member experience. Your club will be better for it today and in the post-COVID-19 world.
Club Trends Winter 2021