The golf market is simply correcting, not dying

Erik Matuszewski has spent more than two decades in journalism, writing about sports and its prominent intersection with business for Bloomberg News while covering many global sporting events, including golf’s major championships. Matuszewski denies the suggestion that golf is dying. This article was first published at Forbes.com.

Golf has a big problem.
It’s the pervasive – and lazy – narrative that the sport is dying. Such a suggestion is not just misguided, it’s wrong.
But it’s a story often regurgitated because golf is an easy target, with detractors saying it’s too slow, too expensive and too exclusionary.
The nay-sayers insist the sport must be in its death throes because participation is down, more golf courses are closing than opening, US golf retailer Golfsmith filed for bankruptcy and sports apparel maker Nike stopped making golf clubs.
Those things clearly aren’t positives, but the issue is that they never seem to come with proper context.
The reality is that the good in the game right now far outweighs the negatives, which is why we should be bullish on golf. There are, in fact, plenty of reasons for optimism.
Golf generates almost $US70 billion in economic impact in the United States annually, impacts close to two million American jobs and pours about $US4 billion into charitable coffers.
No, there aren’t as many rounds being played in the US as during the sport’s zenith – when Tiger Woods was at his prime, the economy was strong and new courses were popping up like mushrooms.
But what we’re seeing is not a precipitous drop in rounds-played, but a return to the level before golf’s popularity spike. And youth participation in the US is up. Yes, far more courses are closing than opening in the US, yet that’s because the market is going through a natural correction caused by over-saturation during the boom years.
The new courses that are debuting give proof to the maxim: ‘If you build it, they will come’, with gems like glorious Cabot Cliffs in Nova Scotia, the trend-setting reversible Loop at Forest Dunes in Michigan and the magnificent Mossy Oak in Mississippi. If nothing else, true golfers are passionate and dedicated souls.
Nike’s exit from the club-making side of the business shouldn’t have come as a major surprise. Nike was never a major player in the golf equipment industry. Sure, the swoosh is highly visible on golf hats, shirts and shoes, but Nike clubs failed to gain a significant foothold in hard goods. The world’s largest sporting goods maker is used to dominating whatever part of the game it gets into. When that doesn’t happen, it pulls the plug – the same way it did 10 years ago when Nike gave up on its slumping ice hockey division known as NikeBauer. And the sport of ice hockey is doing just fine.
Other parts of the golf industry are in a state of consolidation too, including another sports apparal maker, adidas,  selling its golf division that includes TaylorMade to focus on apparel and footwear. Dick’s Sporting Goods, the owner of Golf Galaxy, acquired Golfsmith for $UAS70 million in a bankruptcy auction and took over operations of at least 30 stores.
Shares of Callaway Golf are up more than 30 percent year-over-year. Acushnet, the parent company of Titleist, has exceeded analysts’ estimates since going public late last year with an initial public offering that sold more than 22 million shares of stock under the ticker symbol GOLF. Upstart companies like PXG have found a niche in the high-end of the equipment market, with increasing visibility.
What we’re seeing on the equipment side is manufacturers recognising that mass production and short product cycles are not a viable business model. That strategy just led to excess inventory – including a lot of clubs languishing in retail stores – and consumer frustration. (Who wants their $US500 driver to be seen as obsolete after only a year?) The shift is now more towards longer product cycles and custom fitting.
I recently went through my first full-fledged club fitting, an eye-opening half-day process at The Reynolds Kingdom of Golf presented by TaylorMade. And that expansive facility, on the shores of Lake Oconee, Georgia, has got even bigger – with the opening of even more fitting bays – at a destination popular for instruction, club-fitting, corporate outings and junior programmes. Golf is certainly alive and well at spots like Reynolds Lake Oconee, which features six distinctive courses and is just an hour from Augusta National, the home of the US Masters golf tournament.
Reynolds is in the first year of a five-year partnership with the American Junior Golf Association and in October will host an invitational tournament for players aged between 12 and 15 that caps a season-long series of events – the Road to Reynolds. It’s another sign that youth golf programmes are stronger and more substantial than ever: The First Tee; the Drive, Chip & Putt Championship; US Kids Golf; TGA Premier Junior Golf and Youth on Course to name a few of US national prominence.
And golf today is more international than at any time in its history. The sport got a major visibility boost from its return to the Olympics in 2016 following a 112-year absence, even with stars like Jordan Spieth, Rory McIlroy and Dustin Johnson taking a pass (this time around).
“It was game-changing for the sport,” said LPGA Commissioner Mike Whan. “We’ll see the impact of that for years to come.”
Speaking of the LPGA, its girls’ golf programme introduced 62,000 young girls to the game in 2016 – a staggering increase from 4500 just six years ago. Programmes for women, in general, are making golf more welcoming and less intimidating, seeking to boost female participation. A recent study found that 29 percent of women who are non-golfers indicated an interest in taking up the game.
The engagement of young adults will continue to be vital, though there are encouraging signs. The PGA Tour last year said that the percentage of millennials (those born in the 1980s or 1990s)  who play golf (28 percent) mirrors that of the group’s percentage of the total population, although they only play about half as frequently as previous generations. The PGA Tour has actively embraced digital to try to engage with millennials, including active social media content and the creation of an internet-only network called SkratchTV.
Here’s a sampling of the multitude of other reasons to be optimistic about golf:
• TopGolf’s growth.
With 28 bustling locations across America, TopGolf may be more about entertainment than it is about golf, but it’s an incredibly enjoyable way to introduce newcomers to the game in a novel way – with music, food and fun. And competitors – like TaylorMade-backed Driveshack – are on the way.
• New courses for the bucket list.
If new courses are being built, they need to have a combination of great location and innovative design. Case-in-point: eagerly-awaited 2017 newcomers like Streamsong’s Black Course amid thousands of acres of phosphate mining property in central Florida, stunning Sand Valley in central Wisconsin or Dazante Bay on Mexico’s Baja Peninsula.
• Sub-60 scoring.
Whether it’s better equipment, perfectly-conditioned courses, ideal weather or the depth of talent at the professional level, this year we’ve seen 59s in back-to-back weeks for the first time in PGA Tour history. Going low is in vogue.
• The Kirkland Signature.
The inexpensive ball from Costco created an almost unprecedented buzz throughout the industry, generating both considerable excitement and heated debate. The ball’s lifespan might have already run its course, but its impact was noteworthy.
• Surfing the earth.
GolfBoards – almost a cross between a surfboard and a skateboard – are increasingly being embraced by a sport rooted in tradition. The company this year has introduced a new rental programme for courses to try before they buy.
• Fashionable golf.
Golf casual is popular and it’s why we see brands like Bradley Allen, Peter Millar, Travis Mathew and Dunning designing apparel that can be worn both on the golf course and in the office. There were more than 400 apparel and apparel accessories exhibitors at this year’s PGA Show.
• New formats.
The game is time consuming and people are seemingly busier than ever, which is why it’s heartening to see golf courses offer six or nine-hole options, while others are toying with pay-by-the hole options. Short courses are also becoming more prevalent.
• Golf’s depth.
While Tiger Woods was out of the picture, younger golfers got a chance at more visibility and took full advantage. From Jordan Spieth and Justin Thomas to Hideki Matsuyama and Brooks Koepka, the talent at the highest levels of the game might be deeper than ever.
• Play where the pros play.
This one never gets old. Whether it’s TPC Sawgrass, Kapalua, Torrey Pines, Pinehurst, Pebble Beach, TPC Kuala Lumpur, Hong Kong Golf Club or Sentosa Golf Club, weekend warriors have the opportunity to tee it up on the same courses the pros do. It’s safe to say not as many sports fans have the chance to take batting practice in Yankee Stadium, shoot baskets at the Boston Garden or run routes at Soldier Field.
• Tech in Golf.
From TopGolf to Trackman and Arccos, golf is truly in the technological age, with offerings that help you have more fun, lower your handicap, or both.
• New blood.
Jay Monahan, 46, has taken over as the new PGA Tour commissioner and brings fresh ideas and youthful exuberance. Among the changes ahead could be a global tour, a revised schedule and new formats that include men and women playing in the same tournament, perhaps as soon as January 2018 in Maui, Hawaii.
Golf unquestionably has concerns it needs to address. It also has a passionate core following that’s committed to addressing those deficiencies. The thousands who gathered in Orlando in January for the PGA Merchandise Show are proof of that, as are the millions more who await word of the latest and greatest to come out of the annual gathering.
Focusing on a few negative statistics doesn’t capture the whole picture of the industry, although many try to paint it that way. I encountered it first-hand in the media business: those who would come up with the negative narrative first and then hand-pick a few numbers to push along the storyline of golf’s demise.
But golf isn’t going anywhere. It truly is the game of a lifetime. Part of its beauty is that I can play it with my 80-year-old father or my nine-year-old daughter. And she’s bullish about golf, too. For a lot of reasons.