The Pitch: How high inflation drove €500m in Irish golf revenues in 2023
WORLD RENOWNED: A golfer playing the 18th hole at the Old Head of Kinsale GC. Picture: Des Barry/Irish Examiner
An estimated 250,000 golf tourists – half of which came from the US – delivered a record half-a-billion euro in revenue to these shores in 2023.
The astonishing numbers - 66% greater than first forecasted by industry insiders – are all the more remarkable given the volatility brought on by high inflation on both sides of the Atlantic throughout the year.
While calculations are still ongoing across multiple tourism agencies – Tourism Ireland, Fáilte Ireland and Tourism NI - it had been expected that early projections would reach around €300million – a significant figure in itself.
The Pitch understands that the initial €500m analysis - led by economists and golf tourism finance experts – returned far greater than expected results when inflationary applications were used to assess the impact of economic forces.
The enormous surge in the value of the Irish golf sector, is down to inflation driving revenue – or rather the consequences of high inflationary factors influencing the US market.
While the cost of living increased significantly in the States, the dollar remained strong through the actions of the Federal Reserve allowing the economy and spending to grow throughout the year.
While inflation here affected the price of travel and accommodation for inbound visitors, such increases were insignificant for the high net US tourist, whose personal situation had improved despite an uncertain period pre-2023.
While UK and other price conscious segments across Europe did not hold the same spending power or confidence that inbound US visitors brought, the numbers across all sectors now stands at an all-time high.
With the continued growth – albeit at an expected lower level - of the US economy in 2024, along with significant reductions in inflation, it is expected that income values will surge even further by 2025 – also the year of The Open at Royal Portrush.
It’s a far cry from the uncertainty of one year ago, when inflation hovered at dangerous levels in Europe and across the USA.
The US economy finished the year at 3.1% (from 6.4%) – a bigger drop than the Federal Reserve forecasted – but still higher than the Fed’s preferred 2% stability rate.
In Ireland that number landed on 2.3% for November, the lowest level in two-and-a-half years, having started 2023 at 7.8%.
The bottom line is that the Irish golf tourism industry is effectively immune from high inflation, but only if other factors including the dollar and the US economy are working in tandem to negate those inflationary effects.
It’s clear that price is not a factor for the links-obsessed, high net-worth, American golfer – where already many of the country’s leading courses (particularly in the southwest) are reporting a shortage of premium stock for the season ahead.
Let’s first take a look at some of top per-player fees at the country’s leading links and parkland courses for 2024.
Doonbeg €450
Adare Manor €450
Old Head €450
Royal County Down €426 (£360)
Ballybunion €350
Royal Portrush €340 (£295)
Portmarnock €325
Waterville €325
Lahinch €325
Tralee €275
Baltray €260
St Patrick’s Links €240
K Club €225
Mount Juliet €210
Enniscrone €195
Preferential rates are available at many courses for Irish golfers, guests of members and Golf Ireland membership, but for the free-spending US golf tourist, price has no effect once they get on that preferred time sheet.
For example, if you look at the tourism sector as a whole, the ‘non-golfing tourist’ will spend considerably less than their club-carrying fellow travellers throughout their vacation here.
According to the Central Statistics Office figures for peak season (August 2023), general tourists typically stayed for an average of 9.9 nights, spending €1,351 on their trip – including €356 on fare, €62 on prepayments, €428 on accommodation, and €505 on day-to-day expenditure.
Compared this to golfers, and using the new €500m expected revenue totals number, with an estimated 250,000 visitors – ahead of 2019’s 221,000 numbers – the rate of investment rises considerably working out at €2,000 per golfer.
If we assume the same expenditure for accommodation and other travel expenses of €846, this leaves a daily spend total of €1,154 on average.
But despite this growing and seemingly unstoppable enthusiasm from abroad, there is a considerable challenge in store to prevent such rapid growth from flat-lining in the years ahead.
Stock is the most vulnerable asset in the burgeoning growth of Irish golf tourism – and not just any old asset.
High-net visitors generally only want to play the likes of Ballybunion, Lahinch, the Old Head and the other dozen or so landmark courses, with less interest in exploring new locations.
This has created a challenge in the market at the trophy courses for those most sought-after tee-times of mid-morning, favourable to recovery time from the social exploits of the night before.
These slots are in desperately short supply from May through September, with that need only set to increase.
Trying to encourage the inbound golfer to look at the Northwest or Northeast and its equally magnificent links courses is part of a long and strategic build by Tourism Ireland and Fáilte Ireland, but one which takes time and marketing.
If you take the Southwest and County Dublin as prime examples at the peak end of the market, you must consider that it has taken many years – indeed up to four decades - to build such profile and reputation.
Barry Maye, Executive Director of the Irish Golf Tour Operator Association told The Pitch that convincing the inbound golfer to play other lesser known courses can be a difficult task.
“Availability at some of the trophy links courses is an issue,” said Maye who represents 23 major golf tour operators, which account for a sizeable proportion of the golf tourism market.
“It’s a hard sell to be honest, they want the Ballybunions and Royal County Downs and Old Heads but there are some great parkland options outside of that links niche, including (the likes of) Mount Juliet, Druids Glen, The K Clubs and of course Adare Manor, which is only growing interest levels.”
Barry Maye believes 2024 is “looking even better, with really strong bookings” for the season ahead.
“70-80% of our clients come from North America and inflation isn’t yet influencing their decision to come, they’re not as price sensitive especially when taking the strength of the dollar into the equation,” he added.
“I think that if you look at the NA market, it is really buoyant, and while the Europeans are more price sensitive – as are the UK – the trans-Atlantic demand for golf in Ireland is to increase.”
Paddy's push for prostate cancer hits bullseye
Over the coming days Paddy Power marketing executives will reflect on what has been one of the more visible sports sponsorships of the year, from the firm’s debut as lead sponsor at the PDC World Championship.
The Pitch will crunch the numbers in the coming days from a tournament which was exceptional, particularly with the arrival of teen sensation Luke Littler, who has lifted interest in the darts brand like no male player before.
Total sponsorship values for this championship are likely to surpass €6.95m (£6m) with the Irish betting giant and Village Hotels occupying front and centre branding at the tournament, ahead of a band of associate partners.
The most laudable activation from the tournament outright has been Paddy Power’s donation of £1k for every 180 hit at the championships, a figure which stood at £870,000 ahead of last night’s final between Luke Humphries and Master Littler, pushing totals towards the magic million.
The campaign was also at the front of a drive by Prostate Cancer UK, to try to get 180,000 men to get their prostates checked throughout the tournament.
One of the more interesting watches over the holiday period was how basketball and American football would rate in the Christmas Day head-to-head across eight games in total.
For the NBA the results were disappointing as the Boston Celtics-LA Lakers game drew five million viewers – an impressive number from here, but an 18% drop on last year’s marquee game of the Bucks v Celtics (6.08m).
The highest rated NFL fixture saw an extraordinary 31 million viewers tune in for the Raiders v Chiefs, cementing - as if there were any doubts - the place football holds over basketball in the US.
The NFL has already declared that it won’t hold games on Christmas Day 2024, a strange decision given the exceptional audiences and market share it enjoyed on a most engaging day for US sport.
