April suffered a slight dip in Golf Playable Hours (GPH) compared to 2008. At the national level, April's GPH were off 3 percent compared to the same period last year. That brings the Year-to-Date (YtD) weather impact back into the neutral zone at +2 percent vs. the same period in 2008.
Encouragingly, the YtD regional breadth ratio (measured as the number of regions up compared against the number of regions down) held steady at 1.3:1. This is comprised of 19 regions up vs. 15 down with the remaining 11 weather-based regions recording neutral results (+/-2 percent, all 45 regions were showing GPH in April). Among the key rounds-contributing regions, there are favorable weather trends (up 10 percent-plus in GPH) in Pennsylvania West, Ohio Valley, Minnesota and the Mid-Continental regions among others. Unfavorable YtD weather trends (down 10 percent-plus) among key regions are inland New England, Pennsylvania/New Jersey/New York, Great Lakes and the Pacific Northwest. Fortunately, other bellwether regions such as California, Florida and Desert Southwest are in the neutral zone YtD with the exception of the Southeast Coast region, which is down 5 to 10 percent.
Looking back at the previously-reported March weather results vs. the industry alliance rounds played shows that utilization dropped meaningfully in March to 47 percent or a drop of more than 2 points vs. the 2008 national annual benchmark. Breaking this down, we saw a 3 percent increase in rounds against a 14 percent increase in GPH which suggests that we showed demand growth but it significantly lagged the month's favorable weather.
Pellucid is now tracking percent utilization monthly across 50-plus local markets for clients wanting to understand which local markets gained or lost in this key performance measure.
"I wasn't far off in last month's prediction that we wouldn't see a double-digit increase in rounds demand to match the strong March weather favorability,” says Pellucid President Jim Koppenhaver. “While some clients have raised the valid point that tracking national weather using a rules-based system can't capture all the nuances of localities (like 50, drizzling and slight breezes in Kansas City, particularly on the weekends) the drop in utilization reinforces that we still have work to do as it relates to the fundamental health of demand.
“The other troubling factor to now incorporate into the mix is the PGA of America's recent release of an 11 percent decline in March Median Greens Fee revenue and a 4 percent drop in the same measure for the first quarter. Coupling that with the rounds and utilization for Q1, we get a scorecard of rounds (plus 2 percent), GPH (plus 6 percent), percent utilization (down 2 points) and GF Revenue (down 4 percent).
“That means, we've been able to eke out a gain in rounds demand but fueled by favorable weather and an increased reliance on discounting (i.e. 6 percent higher than 2008 comparing the rise in rounds to the drop in revenue). Not a great first quarter scorecard but, as Joe Beditz and others in the industry frame it, better than all the automakers and financial institutions combined."