HRT 420 Chapter 6 – Club Marketing HRT 420 Chapter 6 – Club Marketing Role of Marketing Marketing = Activities which facilitate exchanging offerings which have value for customers, clients, partners & society at large. Bring buyers & sellers together to complete an exchange. What does that exchange mean for private Clubs? What members receive must be of greater perceived value than money paid, otherwise members will be unsatisfied. Doctors – Patients, Accountants – Clients, Clubs - Members HRT 420 Chapter 6 – Club Marketing Role of Marketing Market – the set of all actual and potential buyers of a product. Market segments – groups of buyers within the market with similar needs and response characteristics. Not all residents of the community are potential Club members. Those that fit the income, lifestyle, geographic and demographic profiles of a potential club member become the Club’s primary target market. HRT 420 Chapter 6 – Club Marketing Marketing Strategy Production Orientation – Lowest Possible Unit Cost (McDonalds) Product Orientation – Broad Selection of Choices (Wendys). Selling Orientation – Send salespeople into the marketplace to stimulate demand. Marketing Orientation – First determine what the market needs – then develop the products & services. Societal Orientation – Customers benefit, but not at a great cost to society in general. HRT 420 Chapter 6 – Club Marketing Marketing Strategy Situation Analysis – SWOT Analysis Market Penetration – Increase market share or share of member Market Development – Taking existing products to new markets Product Development – Introducing new products to current markets Diversification – New Products to new markets HRT 420 Chapter 6 – Club Marketing Marketing Strategy Service Marketing – maximize frequency of purchase, average spending & satisfaction of consumer (member) Internal Marketing – Using employees as the focus of a marketing effort HRT 420 Chapter 6 – Club Marketing Buyer Behavior Family Life Cycle – Takes into account age, marital status and the presence or absence of children in the home. Consumer Purchase Decision Process Inferred *Motivation *Attitude *Culture Directly Observable *Age, Gender, Race, Income, Education, Children HRT 420 Chapter 6 – Club Marketing Buyer Behavior Organizational Buyers *User – the one that will consume or use the product *Influencer – direct or indirect influence *Buyer – formal authority to purchase *Decider – controls the purse strings *Gatekeeper – controls flow of information Buy Classes *New task – great deal of information and alternatives researched *Modified Re-Buy – common or recurring with changes *Straight Re-Buy – routine recurring purchase HRT 420 Chapter 6 – Club Marketing Marketing Mix The 4 P’s of Marketing – Product, Promotion, Place, Price Product Classifications *Convenience Goods – bought with minimum time & effort (Soft Drink) *Shopping Goods – require some comparison shopping (Bottle of Wine) *Specialty Good – No reasonable substitute exists. Consumer is willing to spend time & effort to locate & purchase. (Signature dish) Product Positioning – Strategy for designing image so that the target market understands what the Club stands for relative to its competition Product differentiation strategies such as packaging & physical changes can be used. HRT 420 Chapter 6 – Club Marketing Marketing Mix Product Life Cycle Measured in terms of its revenues & rate of growth Introductory Stage – Revenues low & costs high Growth Stage – Revenues up, costs moderate, premium price Mature Stage – Competitors enter market. Price competition common Decline stage – Technology, changes in tastes & lifestyles, rivals commom HRT 420 Chapter 6 – Club Marketing Promotion Concepts Distribution Centers Multi-Unit Clubs - Expand the reach of the Club & facilitate usage Mini-Chains - Gain purchasing power & accounting advantages Franchised Operations Pros – brand recognition, capital funds, marketing, support services. Cons – Objectives of owners & members differ. Affiliations – reciprocal privileges HRT 420 Chapter 6 – Club Marketing Price Concepts Elasticity of Demand – how sensitive demand is to changes in price Full Cost Pricing – production costs + fixed + admin + desired profit -Arguably the most rational way to set price, identifying all fixed & variable costs can be difficult. Mark-Up Pricing – multiply ingredient costs with a mark-up factor designed to cover non-production costs Gross-Profit Pricing – Estimate all non-product costs, for a period of time & divide by the number of transactions estimated. Amount of gross profit needed to cover each transaction – then add the product cost. Puts a premium on accurate forecasts and does not take into account elasticity. Integrated Pricing – All departments must work together to arrive at maximum Club profit. -Emotional approach. Based on competitive Club prices, intuition, what we “feel” the members are willing to pay. HRT 420 Chapter 6 – Club Marketing Marketing Research Gathering of information which drives marketing decisions Qualitative Research – exploring attitudes & behavior. Focus Groups Quantitative – Deals with numbers. Descriptive research tells the number of members who like & dislike something then gives descriptive demographics Primary Data – Collected specifically for current use Secondary Data – Has already been collected for another use Annual Membership Surveys vs. Specific Surveys HRT 420 Chapter 7 – Membership Marketing Factors in Declining Club Membership Lower membership can cause: *Decreased revenues, leading to a reduction in services *Fewer initiation fees = less capital for renovations & equipment *Poor employee morale *Deferred Maintenance *Renovation projects cost more *Higher member dissatisfaction and attrition rate Factors Include: *Economic downturns *Overbuilding *Generational Preferences *More competition *Aging membership HRT 420 Chapter 7 – Membership Marketing Objections to Membership Marketing Efforts *The Club should be exclusive *It will send a message to the members that the Club is in trouble *It will damage the Club’s image & status *It will cause overcrowding *Members wont get individual service if membership grows *Marketing is not traditional at the Club *Club managers are unfamiliar with marketing strategies HRT 420 Chapter 7 – Membership Marketing Product, Price, Place & Promotion Product *Premier at a high price, average at moderate price, or value? Price *Should be set in accordance with the product position Place *Good location can charge a premier price *Poor location must offer a specialization Promotion Internal – Employees, Newsletter, Website, E-Mails, Table Tents External – Membership Materials, Website, Events, Guests HRT 420 Chapter 7 – Membership Marketing Membership Marketing Plan Internal Analysis – Can use Strategic Planning Process External Analysis – Competition, Demographics, Differentiation Position - What is the Clubs vision and how does that stack up to the competition? Action Plan – How aggressive should the Club be? Will it get support? Evaluate – How many members did it bring in vs. the previous strategy? Appropriate Strategies: -Why aren’t members sponsoring other members? -Is process to cumbersome? Evaluate your policies -Are pricing strategies effective? -Mass media advertising -Corporate memberships HRT 420 Chapter 7 – Membership Marketing Attracting New Members Examples of new Membership Initiatives *New Sponsorship Policies *Installment Payments *Decreased Initiation Fees/Dues *Equity or Refundable Initiation Fees – Non-Equity Memberships *Non-Discriminatory Policies *More Membership Categories Non Golf, Legacy/Junior, Senior, Trial, Significant Other *Family-Friendly Services *Marketing Materials *”Preview” memberships HRT 420 Chapter 7 – Membership Marketing Attracting New Members Other Recruiting Strategies Member referrals – Reminders, Incentives New Member Orientations Member-Guest Events Membership Committee / Membership Development Committee Prospect Lists – Internal vs. External HRT 420 Chapter 7 – Membership Marketing Membership Directors Shift from administrative to marketing oriented Common Duties: *Collects and files all nomination paperwork *Sends marketing materials to candidates *Gives tours / orientations *Follows up on leads HRT 420 Chapter 7 – Membership Marketing Use of Technology Website -Private vs. Public Page Social Media -Privacy vs. Marketing -Who has control? Communications Director? HRT 420 Case Study - Group 1 Website Evaluate the public and private sites at www.SanGabrielcc.com. -What are the main differences between the public and private sites? -What sort of internal marketing is contained for members? -What sort of external marketing is contained for non-members? What marketing suggestions do you have for the member site? What marketing suggestions do you have for the non-member site? HRT 420 Case Study - Group 2 Newsletter Evaluate the newsletter provided. -What sorts of marketing messages, both internal and external are being used. -What are the key messages you take away from the newsletter? What suggestions do you have to increase both internal and external marketing efforts? HRT 420 Case Study - Group 3 Brochures – Internal and External Evaluate the brochures provided. -What sorts of marketing messages, both internal and external are being used. -What are the key messages you take away from the member brochure? -What are the key messages you take away from the prospective member brochure? What suggestions do you have to increase both internal and external marketing efforts?
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