The U.S. golf industry is coming off another record year for recreational rounds – the third in the past four years – and yet golf course operators are missing out on over $1 billion in revenue. So what’s being done to close that gap?

It’s long been known that the value of a golfer is far more than what he or she pays to play golf: the green fee and any cart-related fees. Well, the National Golf Foundation recently put a figure on that, estimating that the total revenue per occupied tee time at an 18-hole public course is 40% to 50% more than the green fees, depending on the type of facility.

Whether it’s a beer and a brat from the beverage cart, golf balls or other merch in the pro shop, range balls before the round, and a meal or other 19th hole revelry post-round, it’s intuitive that golfers spend more than their base playing fee. But many might not realize just how significant that is. Where it turns into a shortfall is with no-shows and short-shows, an example of the latter being when someone books a foursome at a course and shows up for the tee time with only two or three golfers in their party.

Noteefy, an automated tee time demand system that’s one of the fastest growing companies in the golf industry, conducted joint research with Metolius that found approximately 9% of public rounds are no shows. Factoring in NGF’s ancillary spend estimates, this lost opportunity at the nation’s 10,000+ public golf courses adds up to a whopping total of between $1.2 billion and $1.5 billion annually.

“No-shows are pulling (money) out of the pocket of the course and, for many course operators, there is not technology or policy in place to directly address this,” said Noteefy founder Jake Gordon, whose company has partnered with hundreds of daily fee and municipal facilities as well as resorts and management companies to send millions of automated text messages to golfers about unused tee times and help operators recoup revenue from tee times that are typically canceled and not re-booked.

“It’s great the the bucket is full, but there’s a leak in the bottom,” Gordon adds. “There are also ways to plug it by looking at what other industries are doing.”

Text Message Reminders

One such approach golf courses utilizing Noteefy are beginning to employ is like that used by doctors’ offices for scheduling. Via the company’s new offering called “Confirm,” a text message is sent to the patient (or in this case the golfer who booked the time) a day or two in advance asking them to press “1” to confirm their appointment, “2” to cancel it or “3” to modify the appointment.

“There’s a very similar dynamic if you’re a busy dentist to a busy golf course on Saturday,” said Gordon. “If (you) no-show for your appointment, you just pretty much took that revenue out of the pocket of that office, and the fixed costs are still there. That course still has to staff up, they still have to mow the grass and water it, they still have to keep the lights on. Those are fixed costs regardless.

“It’s the same with the dentist, their staff and their labor. No-shows are killer because it’s perishable inventory. My point is that technology and policy coupled can solve this problem, or at least make a big dent in it.”

With an outdoor sport like golf, weather is a key variable. But Noteefy’s research with Metolius indicates that only about 11% of no-shows are actually due to unplayable weather. That means almost 90% of this no-show gap can potentially be addressed by improving booking policies, communication and technology.

Consequences and Other Industries

With the current heightened demand for golf, it’s not uncommon for golfers to snatch up multiple tee times and then fail to cancel, or fail to notify the course when a friend bails because of a scheduling conflict or lack of commitment. One of the issues is that many facilities don’t have consequences in place for these situations.

“If you no-show for a flight or no-show for your hotel room, you’re going to get charged, right?” said Gordon. “You can’t just say, `Sorry.’”

With golf having similarities to industries like hotels, airlines, and restaurants with perishable inventory, a solution is to enforce cancellation policies through efficient technologies. In the restaurant business, OpenTable launched an initiative that includes not only customer education on the impact of skipped reservations – the company suggests 28% of Americans didn’t show up for a reservation in the past year – but it’s coordinating automated reminders, flexible cancellation policies, and penalties for habitual no-shows.

In the golf world, this can mean establishing a booking policy and enforcing it with a credit card, communicating a 24- to 48-hour cancellation deadline, and enforcing fees for no-shows or late cancellations.

In Palm Beach County, Florida, Okeeheelee Golf Course requires visitors to use a credit card to reserve a tee time. Cancellations then must be made at least 24 hours in advance, with the card on file charged up to $20 per player for any guest who isn’t checked in. The result of this policy is that the property is seeing a no-show rate that’s 75% below the market average.

“This is a great way to stay in touch with our customers, similar to medical appointments,” said Eric Garber, Parks Coordinator for Palm Beach County Golf. “The Confirm feature will allow us to remind golfers to cancel their un-needed tee times. Of course, Noteefy will then help us fill the cancelled tee times.”

With a platform like Noteefy, other golfers who are signed up for alerts get a text message notification should one of the tee times that falls within their saved search parameters become available. So, the Noteefy system not only helps operators limit no-shows and short-shows, but it helps quickly and seamlessly fill empty spots should a golfer does cancel the day before their reserved tee time. The company is now looking to help operators close that $1 billion gap in lost revenue.