<![CDATA[Mind's Eye Golf - Blog]]>Sun, 09 Feb 2025 02:06:22 -0800Weebly<![CDATA[Why global golf development will lag]]>Wed, 05 Apr 2017 07:00:00 GMThttps://www.mindseyegolf.com/blog/why-global-golf-development-will-lag
    April 3, 2017
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David Hueber, Ph.D
The U.S. golf market constitutes about half of the golf courses in the world, so, the U.S. golf economy will continue to be the driving force in the growth of the game internationally. However, the downturn in the U.S. economy, coupled with the decline in the number of golfers and rounds played forebodes poorly for future international golf development. Golf is a mature market in the U.K., Australia and Japan, in addition to the U.S. Therefore, the global growth of the game and the development of new international markets will likely lag behind the languishing U.S. golf market.
The conventional wisdom of many in the golf industry is that international golf course development is booming when it isn’t; furthermore, many industry leaders believe that the exposure that golf will receive on the world stage at the Olympics in 2016 and 2020 will ignite global interest and demand for the game. While well-intended, this wishful notion and theory is not plausible given the economic, political, societal and cultural realities in the world today. I wish it was true, but it isn’t. However, what is true is that golf’s presentation on the Olympics’ world stage could greatly expand golf viewership and the global interest in the game. Golf is associated with the Western lifestyle and is the envy of the world; so, there is no downside in presenting golf at the Olympics.

The facts regarding the global development of the game do not support the myth that golf is booming internationally. The National Golf Foundation (NGF) with the R&A recently completed the first count of the number of international golf courses; so, until now, there has been no credible baseline data. The new NGF/R&A global database has identified 33,651 golf courses in the world; 55.7 percent are in North America; 21.5 percent are in Western Europe; 12.2 percent are in Asia; and, 6.1 percent are in Oceania.

Further analysis of the NGF data reveals that golf has flourished in democratic societies with capitalistic economies; and, most importantly, golf has grown only where there is an existing and/or emerging middle class that has the time, money and cultural interest in the game.

Many point to what they believe will be a boom in international golf course development. However, the NGF estimates that worldwide, 350 golf courses are in planning and 300 are under construction. The estimates for the number of golf courses in planning or under construction are not significant and/or are not indicative of international growth in the game and golf industry. Most of the golf courses under construction are upscale resort and/or residential projects that are intended for tourism development, western expatriates and the political/economic elite of those countries.

Golf is not a cultural imperative in most of the emerging international markets (except for South Korea), because these countries do not have an emerging middleclass that is interested or can afford to play the game. One only needs to compare North and South Korea to understand this. Many might recall the media reports in the early 1990s that the late North Korean leader, Kim Jong il, set a golfing record that will never be broken. After only starting to play golf on the day prior to the opening of the new Pyongyand Golf Complex, the “Dear Leader of the Democratic People’s Republic of North Korea” was able to shoot 38 under par for 18-holes. How this remarkable achievement never stimulated tremendous interest in playing golf in North Korea is unfathomable. Putting this absurdity aside, it does illustrate that regardless of the nature of exposition of golf to a population, there are some requisite preexisting conditions for the game to grow.

In other words, the economic, political and socio-cultural preconditions for the growth of the game internationally do not exist. China is often cited as a prime prospect for growing the game. As reported in the March/April 2017 issue of Golf Inc., “The government of China recently confirmed that it has closed 111 courses and imposed restrictions on another 65 during the past five years as part of an ongoing crackdown on its fledgling golf industry.” Further, “China’s Xinhua News Agency claimed that the courses were ordered closed because they were improperly using groundwater or were built on either arable land or protected land with mature reserves.”

While China has a population of 1.3 billion, and is the second largest economy in the world, it is not fertile ground for growing the game internationally. On the face of it, the large population is impressive and sounds very promising, because if just 1 percent of the Chinese played golf, it would translate into China having 13 million golfers.…more than half of the number of golfers in the U.S. Obviously, there are other factors that must be considered such as China’s gross national income per capita in 2012 being $6,091, which ranked 90th in the world. About 10 percent of the Chinese population is identified as living below the national poverty line (earning about $1.80 a day).

The point here is simply that if you are living in China and earning $1.80 a day, have access to a television and were watching golf during the 2016 Olympics in Rio, you are part of the primary target market for growing golf in China. The probability of that person someday playing golf is as likely as most of us taking up equestrian jumping after watching it during that same Olympics. Please don’t misunderstand that I am not against golf being in the Olympics. I was one of the early and leading advocates of it back when I was the NGF CEO. My only objection is characterizing this exposition of golf on the world stage as being a pivotal point in the growth of the game internationally. It’s a lot of smoke and mirrors for a business opportunity based upon building the global broadcast base and viewership for professional golf. There’s nothing wrong with the PGA Tour doing this and there is no downside in having golf become an Olympic sport. It is a smart strategic decision to build global interest in their broadcast product. And, hopefully, when more favorable societal, political and economic conditions emerge around the world, the exposition of golf in the Olympics, as well as the worldwide presentation of professional golf on television will foster the growth of golf participation in those countries and stimulate the demand and supply for the world golf economy.

David Hueber, Ph.D, is a veteran of the golf industry who served as the CEO of the National Golf Foundation and the Ben Hogan Company, and was also a vice president of the PGA Tour. His new book, In the Rough: The Business Game of Golf is available from TCU Press and online from various book retailers.  Autographed copies are available from the author at www.InTheRough.golf.


]]><![CDATA[David Hueber's Response to John Barba’s Blog, “Hogan’s Rough Week: Rebirth or Death Knell?]]>Tue, 10 Jan 2017 13:34:00 GMThttps://www.mindseyegolf.com/blog/response-to-john-barbas-blog-hogans-rough-week-rebirth-or-death-knellIn Response to John Barba’s Blog, “Hogan’s Rough Week: Rebirth or Death Knell?” January 7, 2017 at www.mygolfspy.com.

I had the privilege of being the president and CEO of the Ben Hogan Company when it was at its peak in the late 1980s and early 1990s. Back then, Hogan was a second tier company, but everyone thought that we were bigger than we really were because of the promotional investment made in the Ben Hogan Tour and the fact that we had a very high profile professionals playing on the PGA TOUR. We also had a record selling iron, the Hogan Edge, which I inherited shortly after it had been introduced when the Japanese bought the company. 

Notably, the Hogan company was a profitable until the cash drain related to the acquisition of Pebble Beach and another real estate investment, the Four Seasons Hualalai. This is described in my book, In the Rough: The Business Game of Golf, which has been published recently by Texas Christian University (available online from major book retailers and on my book website at www.intherough.golf).

The new “Ben Hogan Company” founder, Terry Koehler, licensed the Hogan brand from Perry Ellis,
The new “Ben Hogan Company” founder, Terry Koehler, licensed the Hogan brand from Perry Ellis, who had acquired it from Callaway.  Unfortunately, Terry only had the rights for the sale of golf clubs and accessories. Perry Ellis retained the Hogan brand for apparel and golf balls for sale through their distribution channels. 

In my opinion, Terry did an outstanding job in designing the new Ben Hogan irons. Mr. Hogan would have been proud. Unfortunately, the new company’s problem wasn’t the product; it was marketing that product in a changing business environment. And, like so many start-up golf equipment companies, there is a tendency to try to grow too quickly and to compete with the big boys, however, it isn’t a level playing field.

The golf equipment business has transitioned from 80% of sales being green grass (golf course) distribution in the 1960s and 1970s, to 80% being off-course shops in the 1980s and 1990s. Today, the direct marketing of golf equipment online is transforming the business once again, which will cull the herd of brick and mortar stores as it has in other industries. The cost of golf equipment is expensive and the savings online for big ticket items encourage consumers to buy online.  The big companies in the golf business have the financial wherewithal and promotional prowess to market their product in this changing marketplace. How they do business today and tomorrow will change, because how golfers are buying golf equipment is changing.

It is easy to nitpick how the new Ben Hogan Company did business. Having lofts rather than numbers on the irons is something that everyone thought was a mistake. It’s fair to say that how they marketed golf clubs didn’t reflect the new dynamics in the golf marketplace. Further, one can surmise that the margins in licensing a brand aren’t enough for a start-up company, even with the venerable Ben Hogan brand. Scott White has a major challenge ahead and the draconian measures that he is forced to make are necessary…hopefully, there is enough time and the new Ben Hogan Company will survive and thrive.  David Hueber, PhD at www.mindseyegolf.com.
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