Planners Seeking Sites That Fit Their Needs To A 'Tee'

<B>Planners Seeking Sites That Fit Their Needs To A 'Tee'</B>

By Chris Davis

Good economic times have increased corporate interest in golf meetings and raised the volume and level of quality for which the market demands. Growth has been strong, particularly in short-lead time meetings, despite IRS changes and differing levels of interest in golf limiting it as a motivator.

As companies post one favorable quarterly earnings report after another, not only is the money to indulge in a spot of golf readily available, but so is a lack of fear that such meetings will be viewed negatively by stockholders or company executives.

As such, the market has worked to meet the demand. Not only have dozens of new, professional-tour-quality golf resorts, or new golf courses on existing resorts, been built in the latter half of the 1990s in the two twin towers of American golf--Florida and Arizona--but also in more remote areas throughout the rest of the country.

But the increased supply really hasn't shifted the negotiating climate toward the buyer. Depending on the quality of golf the resort can provide, and the cachet it bears from a famous course designer or hosting a professional tournament, courses are able to charge corporate planners large sums of money. Many times, buyers report, negotiating with other courses to cut a better deal is not an option if it means the quality of the golf experienced is compromised.

"When the economy is good, corporations can afford a golf component with their meetings without the perception that they're wasting money," said John Roth, president of Orlando-based meetings management firm Complete Meeting Concepts Inc.

While Roth said he's seen pockets of weakness in particular industries--specifically, financial services--that reflect their lack of current economic strength as a whole, the willingness of corporate meeting planners to make golf a key component of their events is on the rise.

Corporations also seek very high-end courses, especially if the course was designed by a well-known designer or professional golfer. "Often, companies won't request a specific property of course, but they'll tell us where they've played previously and request that the course be equally as nice," Roth said.

While that gives Roth a modicum of buying power, as he can gear the meeting toward less high-end properties and courses if that is something to which the company is accustomed, there are other forces working that have hurt his golf-meeting negotiating position.

"Properties are becoming more savvy in making their golf offerings a major component of their marketing efforts," Roth said. "They point out ways where everything about the meeting can interface with golf. Once a property has a reputation as a quality golf property, they get the leverage and they can use their golf course as a bargaining chip. Upgrading the quality of their courses gives them negotiating leverage."

That underscores the differences in negotiating for corporate meetings with golf and those without. While planners for meetings without golf simply may compare two downtown properties for a sales meeting, with the lower-priced property winning the business, the location of a golf meeting often depends on the difficulty of the course and the availability of tee times.

"The larger corporations, especially, are still playing golf, and nobody's bargain hunting," said Lynne Tiras, president of Houston-based International Meeting Managers. "The negotiation is secondary to the site selection when it comes to corporate golf meetings. We always look to include things like free carts and a golf pro, but the corporations are much more concerned with where they play than how much they pay."

Despite the cash-isn't-king nature of golf meeting negotiation, not every corporation can afford to put their executives on Pebble Beach in May. There are plenty of resorts and courses beneath the highest rung of difficulty that provide enjoyable experiences for many corporations.

Jim Fausel, president of The Conference Connection, a Scottsdale, Ariz.-based meetings management firm, said corporate clients rarely request a specific course for their meetings. Instead, he said, the quantity of golf courses in Arizona is enough to meet the need of whatever corporate budget he has to work with.

"It's a buyer's market in the sense that I don't need to put a corporate meeting at a PGA Tournament-level course to ensure the meeting's success," Fausel said. "When a course hosts a professional tournament and gets on national television, its cost goes up. But we don't need it either. There's plenty of pebbles on the beach."

Suppliers also report increased interest in golf meetings and less attention paid to the bottom line, as corporations feel more comfortable riding their economic strength to the links.

"It's a wonderful market and we're doing better than we've ever done," said Bob Faller, director of sales and marketing for The Otesaga resort in Cooperstown, N.Y., which owns the Leatherstocking Golf Course. "We're booking 10 and 11 months in advance. Buyers are rating the quality of golf as very important, more so than the meeting rooms or F&B."

Faller is finding very little buyer resistance to pricing: "When times are good, nobody asks what it costs."

Otesaga, which recently underwent a $30 million renovation that included a golf course redesign, usually receives meetings from corporate groups in the insurance and financial services industry from New York City and Buffalo, Faller said.

"They'll usually stay for two or three days and split their time half-and-half between meetings and golf," Faller said.

Disney, which sports five full-length golf courses in central Florida, has been a popular destination for corporate meetings and incentives during the past few years, and many of its groups have taken turns at the links. But Disney officials said the entertainment superpower is drawing meetings in a competitive marketplace not only with PGA-quality courses.

"The current corporate desire to go to high draw destinations is very good for us," said George Aguel, vice president and general manager of Disney resort and park sales and services. "But we think the classic profile of the golf meeting is changing. Organizations are looking for even more high profile experiences, so they're negotiating things like award ceremonies, merchandise and photography into their golf meeting package."

Aguel sees the golf meeting attendees' expectations changing and broadening, due to the current healthy financial outlook many corporations boast, but some things haven't changed.

"Excepting incentives," he said, "we still see corporations meeting in the morning and golfing in the afternoon, splitting their time in half."

But companies have tended to keep their lead times for such meetings at a relative minimum. "In the past year, a significant amount of this type of business has been booked within six months of the event," Aguel said.

Jacky Schweinzger, a Carlson Wagonlit corporate meeting planner working onsite for Brookfield, Wis.-based Fiserv Inc., has sent her company's golf meetings to Disney more than once during the past few years. "Anyone I've sent there likes the courses, and the quality of the golf and service is usually the determining factor," she said. "They're always accommodating if we need to change the date or the number of people attending, which will make some courses upset."

At Fiserv, which offers technology solutions to financial service providers, the popularity of the golf meeting shows no signs of slowing.

"If it's a sales meeting or a client meeting, we always try to make sure at least one day of golf is incorporated," Schweinzger said. "But demand for golf meetings has been increasing throughout the industry over the past few years, so it can be a challenge to find a course with availability."

At The Greenbrier resort in White Sulphur Springs, W. Va., demand for corporate golf meetings has been strong enough over the past few years that the resort has instituted a golf academy to help attendees improve their skills.

"Everyone wants to refine their games, from sales managers to CEOs," said national sales manager Steffen Sheerin. "There's no overwhelming trends in the market we're seeing in relation to corporate golf, but our incentive market with golf is as strong as it's been in a while."

But not everyone agrees that the perpetual growth of golf meetings will continue unabated. As Generation Xers and other employees unaccustomed to networking and cutting business deals on the golf course rise into power, the traditional melding of business is bound to change in some form, some buyers and suppliers said.

Changing corporate cultures may have led to a decline in golfing interest among some, as younger employees not wed to the notion of closing deals on the course rise through corporations, said John McConahy, president of Pittsburgh-based meetings management firm Imagination Plus. "There are some financial institutions, for example, that just aren't golfing as much. Maybe there are new people who simply don't want to play as much," he said.

In fact, some large corporations already are basing their site selection less on the quality of the golf course than in previous years, said McConahy. The trend has created buying opportunity, he added, with prices at golf-centric properties better than in previous years, particularly during the off-season.

"Golf courses have been going up right and left, and I'm not sure companies are willing to spend the big bucks to go to a specific course like they were five or seven years ago," McConahy said. "There are an awful lot of beautiful courses out there, and some companies think they don't have to spend as much to play on one."

Another factor in what he sees as a gradual decline in golf as a meeting motivator is changes in Internal Revenue Service regulations, which have limited the ability of corporations to write off golf-heavy meetings as business expenses, McConahy said.

"The IRS has changed its rules over the past five years, so you may see more companies holding two days of meetings and a half-day of golf, where five years ago the same companies might have held three-day meetings, each with a half-day of golf," McConahy said.

Even some resorts aren't completely convinced that the popularity of ending business meetings at noon to spend the rest of the afternoon on the links will continue unabated.

"There are more people playing golf right now, but corporations are trying to please everyone, and it's a difficult-to-please era," said Tory Parks, director of sales at the Del Lago Golf Resort and Conference Center of Montgomery, Texas. "We have a great course and lots of corporations use it, and we have several competitors. But in this area, the golf is not going to be the determining factor in whether a planner selects us. It has to be the total environment.