Are OTTAs Golf’s Disintermediaries?

Posted By on May 15, 2019 | 0 comments

“I don’t believe most golf courses need the OTTAs’ marketing services to meet the natural demand for golf in our marketplace, nor do I think they stimulate incremental demand for golf.”

Wow. Now that I read that a month after the print dried on the last issue of Golf Business, it sounds rather harsh. I think it’s because I’ve become friendly with a couple individuals trying to make a go of it in the Online Tee Time Agency world, despite my skepticism, and I don’t feel good about using my bully pulpit in ways that could damper anyone’s success in golf. It’s not the “golf way” to be so public with criticism like this.

Nevertheless, let me see if I can get this straight. We have millions of people interested in playing golf (apparently, “latent demand” is as high as it’s ever been), but who are not moved to do so. The volume of tee times and players have both declined since about the same time OTTAs came on the scene. The price of golf is cheaper than ever (compared to the Consumer Price Index).

Profitability is arguably tougher to achieve than ever. While the golf course economy has been living under black clouds (literally and figuratively), tens of millions of dollars annually are poured into OTTAs each year. Something is incongruent here. If you look at it from the bird’s eye perspective, how can you not be a skeptic?

Over the last three years, I can count on one hand how many times I’ve encountered a course owner who praised their OTTA. Rather, nearly every time the topic is broached, there are words of frustration, rolling eyes and shaking heads. The fact you can’t even have a conversation about OTTAs without an undercurrent of negativity tells us something is rotten in Denmark. Talk all day long about golf cars, insurance, balls, sticks, apparel, turf equipment, F&B, etc. and it’s all pretty copacetic. Mention OTTAs, and you’ll see the tone go south more quickly than Ohioans converging on Myrtle Beach in April. If these relationships were healthy, this simply would not happen.

A year and a half ago, the CEO of one of the OTTAs (who shall remain nameless) literally jabbed his finger in my chest and said (expletives omitted), “I’m sick and tired of NGCOA being anti-third party.” Let me be crystal clear. I’m not anti-OTTA. I’m just against anything that doesn’t clearly and unequivocally support the success of golf course operators. Or in the case of “disintermediary,” anything or anyone who comes between the golf course and the customer.

If OTTAs want to win my favor or (infinitely more important) the favor of the thousands of courses that also look upon you critically, here’s your simple recipe:

  • Stop the incessant discounting. In the race to the bottom, you’re handing out the bibs, the running shoes and you’re manning the Gatorade stations.
  • Abdicate your ability to price tee times. Let courses price their inventory against the natural supply and demand without your finger on the scale.
  • Implement demand-generating marketing and technology aimed at bringing revenue that wouldn’t have happened without you. Prove to a course owner you’re bringing them new customers and increased play from existing customers. Don’t leave it up to the course to figure it out.
  • Provide rich data on revenue and activity from the bartered tee times, so a course operator has transparency into the value of the relationship.
  • Stop using a course’s own brand to market against it in search engines and on your own directories. When an OTTA uses a course’s name in the search engines to direct business to competing courses, how can you not shake your head?

When I started writing this, I was hoping to talk myself into a kinder position. But I’m not there yet. I need to be convinced the net result of all of this is a positive one – for every single course that participates, and for the industry as a whole. Until then, I ask my readers and NGCOA members – am I being too harsh? I’m a reasonable guy. Tell me what you think.

Post script thoughts since my column printed in the magazine:

  • Some course operators shared with me that OTTAs may be more valuable to courses in destination markets, where a lot of golf is not local play. Point taken. Most golf is local play, and for that type of play, there is almost zero need (in my opinion) for online aggregators, except to facilitate booking of EXISTING demand. But how much should a course pay to help existing demand book golf through a disintermediary?
  • What if OTTAs allowed courses to only post inventory they wanted help selling? Forget the high demand times. Who needs help with that inventory? Or, better stated, what if courses only gave OTTAs inventory they wanted help selling? In fact, isn’t that how a large OTTA got its start years ago – by helping golf courses out West sell their “junk” tee times? I’m certain hotels don’t give OTAs (like Expedia) access to all rooms for every night of the year. Hotels pick and choose what room types and how many can be sold on the aggregators.
  • OTTAs can help an individual golf course build their database, that is true. But some might still make the course work for it (in addition to pay for it). If the golfer bought a bartered tee time, it’s still on you to get their data (shaking my head).
  • Some OTTAs offer critical technology and services, and that’s really good stuff. The more advanced and helpful the technology can be, the better the course operations can be. There can definitely be symbiosis there. But accessing that technology should not necessarily involve selling tee times through the same company to get it. You can get some great technology from purveyors in our industry without having to open the kimono of tee time inventory, let alone give the OTTAs power to price YOUR golf.
  • I had a laugh on the phone the other day with a great course owner. We were trying to establish the best analogy for these new dynamics. We settled on this: course operators want to have a faithful marriage with their members or customers. To nurture a long-lasting, loving, symbiotic relationship. OTTAs want to get in on the action too, but only by getting courses and golfers to have “open marriages” with them, and all the courses they are in relationships with. But is that really sustainable for the golf courses?
  • In the tug of war of supply and demand (courses on one side trying to provide a quality product at a strong price, and golfers on the other side wanting a quality product at a lower price), OTTAs are providing the rope and saying they want to see both sides win. But is that just fantasy thinking? One side is just going to get stronger as it grows a following, and the other side will get tired and weaker from pulling and not getting anywhere. Course owners – do you think pulling on the rope is making you stronger and better? Or is it time to just let go of the rope?

I’m just asking the questions, folks. I’d love to hear from you. Tell me your OTTA success stories! Tell me your OTTA failure stories! We’re all in this together.

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