Tue Aug 3 2010

My beef about pies!

Why is it that some bakeries charge extra for condiments, such as tomato sauce? Wouldn’t it be better to raise the overall price a little and give everyone a free sachet? Surely the sauce is an integral part of the overall consumer experience of having a pie, so why do we distinguish it as an additional service and cost? We don’t have to pay extra for the bag, pie tin, napkin, or “service fee” for the rubbish bin when you dispose of the remains. In most cases, I’m happy to pay for the overall experience and will pay extra for the added convenience. Charge me more for the pie in the first place and include the “sauce” (one sachet or a bottle on the counter to use is fine). I’d be a much happier customer and more likely a repeat customer. If these bakeries took this approach, they would also experience increased incremental revenue. Related story: Price impact on guest satisfaction (*NOTE: Health regulations in some states do not allow shops to serve sauce out of a bottle)

 So which type of golf facility are you offering, the overall consumer experience or the low budget experience?

 If you were staying at any decent hotel worldwide, you wouldn’t expect to pay for extras, such as shampoo, soap and towels. However, with today’s airfare wars, we are now becoming accustomed to paying for the extras when we fly. If we want a cheaper or discounted price on an airfare, then we can choose what we want. This tactic is fine for most travelers, but they aren’t always the bigger spenders.

 This same issue happens at many sushi restaurants where we sometimes get charged extra for the soy sauce and wasabi. This isn’t expensive, but it sends an underlying message about the mindset of the operator. As the ‘yanks’ would say, “Stop nickel and diming me to death!”

 Consumers are now in control

 Many of the presenters who spoke at the biannual Australian Golf Managers Conference in Perth last November talked about the change in the way consumers are making decisions. Once upon a time the seller was able to set the terms, but nowadays the consumer can dictate and in many cases looks for an overall consumer experience. The consumer is now in the driver seat and we must change our operational mindset to retain more.

 Consumers/members are making their selections in a much different way than in past years. We as operators need to start listening to them more than ever before. Let’s look to tailor our products (membership) to their specific needs and come up with some offerings that are all inclusive to their particular needs. We have a huge number of social players that love the game, but may or may not want to become a traditional member, perhaps because they don’t understand what is totally on offer as a member. Your club needs to figure out if they want them or not. If you don’t that is fine, but then don’t complain about membership attrition. If you do want them, then accept them with open arms and make them feel welcome.

 The message here is that we need to get out of discounting mode and selling solely on price, and start relaying the message about selling the experience. You will be able to start holding your rates, and retain your loyal members, and they will be happy to pay for the experience. (Start by making your list of Top 10 reasons to become a member of your club or for why people should patronage you)

 I now must personally come to terms with paying extra for condiments or start carrying around my own bottle of soy and tomato sauce. By no means am I a cheapskate, it’s simply a matter of principle!

 Written by Mike Orloff, Golf Operations Specialist, Golf Industry Central July 2010

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