Is Private Club Data Analytics Due for A Disruption? (1/2)

In the past few years, I have helped many prestigious private clubs to use data analytics to support their initiatives. I met numerous creative club managers and directors in every club I visited, full of innovative ideas and theories on improving business and better serving members. Below are some examples. Do they look familiar to you?

• A golf club would like to acquire more nearby houses and convert them into guest rooms. They would like to justify this initiative by projecting how much extra revenue these guest rooms would bring to the club
• A board member anticipates changing member demography in the next 5 – 10 years and would like to understand if the club’s capacity is ready to handle the new demography
• A membership director finds out a few percent of members unsubscripted after each email blast, mainly because the email campaigns are not targeting the right members
• A food and beverage director would like to drive more people to an under-utilized restaurant. He would like to come up with a list of members & spouses he can target
• A GM would like to come up with new initiatives to increase per member spending
• A membership director would like to find out which members are using the club a lot less than before so that she can reach out to engage them before they quit
• A golf club board member would like to know how much return the recently purchased Golf Simulator has brought to the club
• An executive chef would like to track how well the newly created “Protein Bowls” items are selling, who are buying them, and where they are selling

The list goes on and on. All these initiatives can be evaluated and backed by data clubs already have. For instance, for the first item, we can look at all the guest room stays and check for each night how much extra money a hotel guest spends on F&B, Golf Shop, and others. Then we can use that to project how much additional revenue the future guest rooms would bring in. For the second item, assuming we will have more younger members in the next 5 – 10 years, we can examine how younger members use the club today and scale that up to see if the club can handle more of these members. However, almost everyone shared one unfortunate fact with me: they had a hard time finding the data to back those ideas and theories. 

Clubs strive to be better and react to changes every day, and they know data is a big part of it. However, as one membership director I met said, “we know the data are there. We just can’t get them out”. The lack of an easy way to mine their data is slowing clubs down.

To understand the data challenge clubs are having, we need to step back and take a quick look at the history. In the past few decades, private clubs have implemented various club management systems and best-of-breed POS, reservation, and other tools to track member usage. According to a study done by Golf Genius in 2019, clubs can use up to 30 different IT systems to run day-to-day operations. As a result, a tremendous amount of high-quality member usage data have been collected by these systems. However, collecting data is one thing, and mining the data is something completely different. Although many of these systems come with pre-built reports, these reports can only tell you what happened, not why. To find out the why, clubs need to slice and dice the data in any way they want and drill into details if needed, which are nearly impossible to do with these pre-built reports. In addition, more and more clubs are interested in a complete picture of how members use the club, which requires merging data from different systems into one 360-degree view. Unfortunately, today the most popular tool clubs use to mine their data is still Excel. To answer a business question, it could take an Excel “guru” days to run multiple pre-built reports, then download these reports, cleanse/massage/merge the data, and eventually get the numbers. This process is not only time-consuming but also error-prone. The long turnaround time also pretty much makes it impossible to ask follow-up questions. Because of all these pains, clubs often make critical decisions based on guesswork or gut feeling instead of actual data, putting clubs at risk of making the wrong decision or failing to respond to changes timely. There must be a better and more affordable way for club managers and directors with no technology background to get accurate cross-department data to back their decisions quickly.

I am one software professionals who believe software solutions should start from automating what your customers manually do. Suppose we could automate what that “guru” does with Excel, i.e., downloading, cleaning, massaging, and merging data from all club systems. In that case, we should build a data warehouse that holds accurate data and is ready for non-tech users to ask questions. Furthermore, wouldn’t it be perfect to put an intuitive and easy-to-use interface on top of that data warehouse and let users use that interface to build any report they want and get results in seconds?

Luckily the technologies that can make these dreams come true exist today. In the next post, I will share a case study where we helped a top private club build a solution that supports the club’s goal of increasing per member spending and engagement. We put member demographics, a la carte, club events, banquets, tee sheets, dining & sports reservations, pro shops, and e-commerce into one dashboard. Users can get their answers within a few mouse seconds. I will also share how club managers use it to make informed strategic decisions and improve day-to-day operations.