Tiered Pricing

Jeffery Buttitta, the 2004 Illinois PGA Section Merchandiser of the Year for Private Facilities, is the PGA director of golf at The Hawthorns Golf and Country Club in Fishers, Ind.

I recently reexamined our facility’s pricing structure for Monday outings, as all too often I see clubs that have a set fee structure for outings – and it causes them to only be able to cater to a small segment of potential clients. When it comes to outings, we have both a food & beverage and golf fee structure for each person. I realized for the golf portion of the outing we’re not selling a tangible object like we are for food & beverage. Therefore, we’re more flexible with golf pricing, which is more attractive for a variety of prospective clients. As such, I’ve restructured our pricing formula, now charging per player on a tiered basis depending on how many players the event coordinator can guarantee. For example, if the group will have 70 players it would fall into Tier No. 1. If the group’s number reaches 90 players it falls into Tier No. 2, and if the field exceeds 120 players it moves into Tier No. 3. The price decreases as the group moves into the higher tiers. Our new structure allows us to charge less per person if the event yields greater participation, which gives event purchasers more incentive to purchase larger events. This makes us more attractive for a variety of budgets. Furthermore, our food & beverage operation has also followed this plan, and we’ve come up with a variety of food options to better meet the client’s budget.

For 2009, I am on pace to increase outing revenues by 15-20 percent over 2008, and the main reason for this is because of the variety of packages we offer. Previously, some clients would see our pricing and lose interest right away. For outings it’s all a numbers game, and the more people we bring in ultimately raises revenue for the club. However, this program can only be successful if both the golf and the food & beverage operations work well with each other to create a variety of attractive packages.