Pent-up post-Covid travel and golf's two tiers of playing experience
Lahinch, one of Ireland's most famous clubs, posted record green fees for its 2022 financial year, but there are signs of some decline across the UK and Ireland and uncertainty, as ever, reigns.
Last summer, the famous old course of Lahinch, on the Atlantic coast of County Clare in the west of Ireland, grabbed the kind of headlines and photo ops that even the most ingenious, most well-budgeted marketing departments could only dream of.
As the Irish Open, sponsored for the first time by the biotechnology company Horizon Therapeutics, was taking place a few hours’ drive east at the parkland course of Mount Juliet, some of the world’s top golfers were in Ireland—just not for the pro tour event.
Three-time Major winner Jordan Spieth, recently-crowned US PGA champion Justin Thomas, Masters champ and new world number one Scottie Scheffler and Rickie Fowler, without a Major but still one of the most colourful and biggest draws on tour, were in Lahinch for some fun times as the grinders and grafters of the DP World Tour were trying to earn their daily bread the other side of the country.
They were playing Lahinch in advance of the JP McManus Pro-Am at Adare Manor and, maybe partly, as prep for The Open Championship at St Andrews a couple of weeks later.
The photos and media attention that followed them will surely have set pulses racing among the Lahinch treasury committee.
The upside of such exposure—truly a multiple spasm wet dream for golf marketers—is unlikely to be felt until at least the 2023 figures and perhaps even 2024, given the expected timelag for golf holiday planning for US visitors.
But if there is to be another big bump for Lahinch, it will have to go a way to surpass the 2022 numbers.
In the recent Annual General Meeting of the club, a massive 300% lift in green fee revenue was reported, from a figure of approximately €1 million in 2021 to a shade over €3 million in 2022.
More than anything, that is likely down to massive pent-up demand for golf tourists who were forced to shelter in place through much of the Covid-affected 2020 and 2021.
The 2022 bump is likely also to have owed something to Lahinch’s most recent Irish Open hosting, when Jon Rahm won the tournament in the summer of 2019.
The broadcast of that event—containing gorgeous panning drone shots of the course hugging the Atlantic coast as well as those unique old Lahinch stone walls and the distinctive “in-the-middle-of-the-town” feel to the club (which in many ways echoes the experience of the Old Course at St Andrews)—will surely have moved many a distant viewer to travel agents and booking sites.
Overall revenues at the club in 2022 grew 93% to €4.94 million, with green fees making up a shade over three-quarters of the income.
A round of golf for non-members at Lahinch during high season 2023 will cost visitors €275.
That figure still might look like decent value compared to some other famous Irish courses: Royal County Down in summer 2023 is £325 in UK money, equating to approximately €375, while the Old Head at Kinsale comes with a high-season rate of €395 in 2023, rising to €425 next year.
Golf’s two-tier effect
Over time, it may well become apparent that the two tiers of golf playing finance will draw further and further apart.
On the one hand, you have wealthier travellers who are happy to pay higher prices to access the most esteemed courses.
On the other there are the local members who may be disproportionately affected by economic headwinds such as inflation and the cost-of-living hikes that come with it.
That effect can be estimated from recent figures published by BRS Golf, a company that provides tee-time management technology to thousands of golf courses worldwide.
BRS recently published data for the UK and Ireland for Q1 2023, showing a not insignificant year-on-year jump in member rounds played.
Overall, according to their Quarterly Participation Report, BRS Golf processed 5.6 million member rounds in the first three months of the year, with the largest spike coming via a February that was much drier than average across the UK and Ireland, when 500,000 more rounds were played.
March, conversely, started with subzero temperatures and widespread snow and rain and ended, in the Irish weather authority’s clinical assessment, as “unusually wet and dull”—and that’s saying something, given that “wet” and “dull” might be the two words you would use to describe March in Ireland—but despite that, member rounds for the month were flat year-on-year.
The final figures were a 9% jump in member rounds played in the first quarter of 2023 against the same timeframe in 2022.
(The company reported that the figures are even more impressive compared to the last pre-Covid year of 2019, when 2.8 million rounds were processed, although it’s not clear whether that says more about the golf playing ecosystem or the growth of BRS Golf as a technology provider during that time.)
All that looks promising.
Darker clouds might be on the horizon, though.
Starkly, the number of active memberships reported by BRS dropped by 6,000 in the first months of the year, and more than 50% of those lost members were on the island of Ireland, where 18 separate Irish clubs monitored in the data lost more than 100 members each.
Given that true membership data is likely to need some time to filter through, BRS acknowledges that the real state of affairs for 2023 active member numbers may not be fully known until at least July 2023.
Wrap
Only by later in 2023 will we have a better idea whether golf membership, which benefited from the Covid bump in 2020 and 2021, is on the path to a significant decline that may takes some years and plenty of imagination to reverse.
By the second half of 2023 we may also be armed with better information about the willingness of cash-rich US golfers to continue making the trip across the Atlantic in the same numbers.
One of the biggest non-golf stories of the year so far has been the problems within the US banking system, where just in the last few days First Republic became the biggest US bank to fail since the collapse of Lehman Brothers in 2008.
First Republic followed hot on the heels of the failure (or, as some might say, forced takeovers) of Silicon Valley Bank and Signature Bank in March and—more broadly—Credit Suisse in April.
It’s hard to imagine that such upheaval in the financial system will not have knock-on effects for many, including those with the most dollars in those banks, but whether golf clubs, their playing members and wealthier visitors will be among the downstream victims, only time will really tell.
Thanks for reading.
Starting summer 2023, there will be a two-pronged approach to this Substack. I will aim to post regular newsletter-style updates (like this one on Lahinch, green fees and membership) as well as occasional deeper dive longform essays and research pieces (like last year’s 7-parter on the PGA Tour and LIV Golf, which eventually ran to approximately 25,000 words).
The Wedge aims to cover the business, money and mystique of golf. If you have any ideas for stories you think might fit here, please get in touch by emailing thewedgegolf@substack.com.
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