Despite slowdowns in the golf business at large, the destination golf industry has continued to grow in recent years. At the International Golf Travel Marketplace conference in Marrakech, Morocco, senior editor Robert Silk met with Peter Walton, CEO of the International Association of Golf Tour Operators (IAGTO), to discuss the industry's outlook.
Q: How would you characterize the state of the destination golf industry?
A: You look at the state of golf and golf travel, they are two different things. Overall participation in golf has sunk. In the United States, the numbers of participants has sunk from about 30 million to about 25 million. But the number of avid golfers in the United States is 7 million, and it hasn't gone down. And it's avid golfers who take golf vacations. Last year and the first two quarters of this year, the average growth reported by the 1,000 hotels and golf courses in our association was 3.6%. We have 709 tour operators, and so far this year, sales are up 7.2%. Since 2011, outbound sales have grown between 8% and 10% a year. It can't keep growing at that rate because of capacity limits. Many of the most popular destinations at the most popular times of year have gotten to the stage where they are reaching capacity.
Q: Why is capacity maxing out?
A: Since 2008 the pace of growth of new resort courses, or tourism-relevant courses, has really dropped because they were being built as drivers for real estate sales. And of course the real estate market fell through the floor, and nobody builds a golf course just for the $2 million profit on greens fees sales. They've got to have a hotel, or they want to have real estate sales. So landowners have just sat on the land. And that still goes on to this day. There are only three countries, really, that are building golf courses, at any rate. We are sitting in one of them right now, which is Morocco. Vietnam is another, and China was the other, but that's stopped now. So that's why capacity is hitting the ceiling in popular times in popular destinations. But in the States, we surveyed 160 tourism-ready courses two years ago, and the average capacity for growth was 19%.
Q: Are there any emerging trends in the destination golf industry?
A: Trends don't change in 12 months. I did a survey in 2015. We asked hotels and golf courses, have you seen a significant increase in women golf travel over the past three years, and 55% said yes, very significant. Women with couples and women-only groups. Couples golf is a very strong golf trend at the moment.
Q: The outbound U.S. golf market is highly concentrated in Mexico, the Caribbean, Scotland and Ireland. Do you see lots of growth potential for other dots on the map?
A: What doesn't add up is that Americans travel in the millions to [many destinations in] Europe and Asia, but outside of the places you mention, golf has hardly scratched the surface. I think it's a massive opportunity because the reality is Americans do travel to these [other] places, but they don't go to play golf. We work with 106 countries. And it's not just about golf. You explore the country by their fairways. That's the way I look at it. In destinations with caddies, you learn more spending four hours with a caddie who speaks 250 words of English than you do with any tour guide. I think there are amazing experiences to be had. For the American market it is just waiting there to happen, but nobody's got their hands around it. I am going to make sure that the IAGTO has an impact in changing that.