Golf business at the U.S. Open: On par with steady progress

Last year, 594 million rounds were played in the United States at approximately 15,827 golf courses. Despite these prolific numbers, the Sporting Goods Manufacturing Association reported a 7% decline in participation. Clearly, marketing at all levels must be emphasized.

The "Tigerization of the Tour" was important for the game 10 years ago. The emergence of the Phil Mickelson-led "Big Five" and budding young superstars is equally as critical over the next few years.

Yet the First Tee program at over 150 golf facilities nationwide is probably most important, since in order to sustain a fan base, young golfers must enjoy the game – and stick with it. Overall, golf's fan base has increased from 70 million 10 years ago to over 100 million today.

And then there's the equipment and course factor. In what is likely golf's biggest controversy of 2005, the United States Golf Association has asked 35 ball manufacturers to design two prototype balls that would travel 5-8% shorter. While this step may make sense for the long-hitting pros, few amateurs are going to settle for a ball that travels 20 yards shorter.

An estimated 175 new golf courses are opening this year, with many more in planning or construction. Since many are designed for longer and longer hitters, the amount of land needed for a successful golf course and becomes more acute. The higher greens fees needed to support this level of development will likely drive more golfers away.

On the other hand, the international golf market exceeds $38 billion. Over 40,000 golf courses can be played worldwide, and countries such as China look to double their number of courses within the next few years. London-based HSBC will sponsor a new $5 million golf tournament in November in Shanghai – with Tiger scheduled to play.

Two recent events foretell the long-term health of the golf business. Last month, golfer Harrison Frazar signed a sponsorship agreement with Thompson & Knight, becoming the first PGA tour competitor to be sponsored by a law firm. The second (and probably more comforting) incident occurred on the 115 yard 15th hole at the Antelope Greens golf course in California. Three golfers in one foursome passed a polygraph test confirming their shooting of three hole-in-ones on the same hole – a "27 trillion to 1" feat. This provides future foursomes something to shoot for.