Updated: April 24, 2012 4:03PM
Three brothers who run their family’s construction equipment business are aiming to reinvent what critics consider a flawed business model for golfers to book tee-times online.
The Robertsons — Glenn, Struan and Brent, whose father, Alastair, founded Universal Equipment in Glen Ellyn — are launching back9booking.com on Saturday with two unique properties: The online booking service will be free to golfers, and will charge a flat commission per booking to golf-course owners.
Back9booking, based in the West Loop, has agreements with 45 golf course operators now, and expects to have 70 by year’s end.
The Robertsons — Brent, 26, the chief executive officer; Struan, 28, chief financial officer, and Glenn, 32, chief operating officer — say they aim to work with golf course operators as partners, and they started their company out of frustration with their own inability to quickly find a variety of courses.
The brothers faced a conundrum: Most golf courses permanently reserve tee-times on Saturday and Sunday mornings. The brothers couldn’t easily find a variety of courses within an hour’s drive where they could play four to five hours and come home.
“We ended up playing the same course over and over, missing other opportunities because we didn’t want to call all of these courses,” said Brent, who played in the Illinois Junior Golf Association as a teenager and worked at the Village Links of Glen Ellyn throughout high school and his early college years.
They started their business after they had spent a year and a half calling 40 to 50 golf course operators to see what the operators wanted in an online tee-booking system. Their startup focuses on making the interactive experience as simple as possible.
“The golf courses allow our company to incorporate our tee-reservation system with their back-end software so the reservations are made in real time and immediately posted online,” said Glenn.
The booking startup will go up against the biggest player in the industry, GolfNow, which is owned by the Golf Channel. GolfNow entered the industry four years ago by acquiring several independent companies, including GolfSwitch and Active Network.
GolfNow.com offers on-line tee times 24/7 at more than 120 Chicago-area golf courses and at 3,700 courses throughout North America, Ireland and the U.K.
GolfNow.com charges each golfer who books a tee-time online a $1.99 transaction fee for each booking. GolfNow receives one tee-time per day in revenue from each golf course in exchange for providing the booking service.
GolfNow.com also offers a weekly promotion via email during the golf season through its Deal Caddy (Dealcaddy.com) marketing arm. The weekly deals range from tee-times at certain courses to a weekend golf package to a deal on a subscription to Golf Digest magazine.
GolfNow spokesman Jeremy Friedman says the system, which drives nationwide publicity through the Golf Channel and GolfChannel.com, makes it easier for golfers to reserve tee times, helps the golf courses gain publicity in the growing social-media space and increases revenues at a rate the market will bear during down times.
Yet Jim Koppenhaver, president of golf-industry information provider Pullucid Corp., based in Buffalo Grove, says GolfNow’s method of selling select tee times at 50-percent discounts from the prevailing rate cards has driven down golf-course operators’ revenues, even though the operators agreed to those terms from the start.
A “dynamic tension” has emerged between GolfNow and other websites that list discounted tee times and the golf course operators because the discounters list low tee-time rates of, say $20, next to full $40 rates, which can confuse golfers, forcing golf-course operators into a race to the bottom, Koppenhaver said.
The result is that golf course operators, already clobbered by the recession, have cut back their spending on maintenance and labor, he said.
“This is a place where the golf industry shot itself in the foot,” Koppenhaver said.
“If a tee-time reservations site would operate on a commission or fixed-fee service, the courses would have recourse against the barter game,” Koppenhaver said.
Despite the latest innovations, the golf industry still must overcome a shrinking customer base, which Koppenhaver also blames on the industry.
Nationwide, golf courses lost 10 percent of their golfers between 2001 and 2010, now numbering 26.3 million, and 10 percent of their booked rounds from 2001 to 2011, according to Pellucid Corp.’s surveys.
Koppenhaver believes the USGA, which sets golfing rules nationwide, should loosen its playing rules, dress code and golf-club requirements to let more people play recreationally.
“People don’t like to play recreational activities they’re not very good at,” he said. “The golf industry should allow equipment that would make it easier for someone to hit the ball and get it in the air, hit a couple good shots and have a good time without having to take 100 lessons.”
Tom Denklau, PGA director of golf for Hilton-Chicago Indian Lakes Resort in west suburban Bloomingdale, said he welcomes Back9Booking as a way to reach new golfers.
Denklau said 30 percent of the resort’s golf-course bookings are done online, and he expects the numbers to keep growing along with the course’s revenues.
Though Indian Lakes was hit by the recession and a pullback in business outings, Denklau said the resort is rebounding as it leverages its website and social media to tout its 27-hole golf course, unlimited-golf memberships, range-membership rates for late-afternoon and tween and teen golfers, 18-hole miniature golf course and non-golf options such as swimming pools, tennis courts, horseshoe pits, volleyball courts and restaurants and conference center.
“Golf courses no longer survive as corporate destinations where John Smith brings three of his clients,” Denklau said. “We’re trying to be as many things to as many people as possible.”