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The Lucy Li Show

Income and Changing Demographics Key to Understanding Millennial Golf Participation

Initial findings from Project M, NGF’s comprehensive ongoing research project that examines the relationship between Millennials and golf, reveal two of the primary reasons for the difference in golf participation among 18-34 year olds of today and the early 1990s – lower income and a continuing demographic shift in America.

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Golf is one of only a few ‘Pay-for-Play’ outdoor activities.  So, naturally, income is a main driver of golf participation.  Millennial income levels are down significantly compared to similarly aged folks from the early 1990s.  For our research, we broke up the Millennial generation into three groups – 18-23 year olds, 24-29 year olds, and 30-34 year olds.  The two younger groups showed bigger drops in income compared to the older set.  The income level of the 24-29 year old group is down 10% from the early 1990s, and it is within this age group that the biggest drop in participation has occurred (over 40%). This is the post-college age group where many are starting their first job (i.e., low salaries), and some, unfortunately, are underemployed or even unemployed. 

Current Millennials in the 30-34 year old group are more established in their careers than their younger brethren, and their income is down only 3% compared to the 30-34 year olds of 20 years ago.  As theorized, the gap in golf participation of this age group between the 1990s and the 2010s narrows to about 20%.  This tells us that as Millennials earn more money, they play more golf.  We expect this ‘delay effect’ to continue, and anticipate that as this generation ages, golf participation will gradually increase.

Click here to enlarge the chart.

Our research shows that a shift in demographics is another reason that Millennial golf participation has weakened.  The face of America is becoming increasingly diverse.  The population of non-Caucasians has grown more over the last 20 years than ever before.  In the 18-34 year old group, the non-Caucasian population has grown by more than 60%, compared to a decrease of about 18% in the Caucasian population.  Previous research has shown that non-Caucasians play at a lower participation rate than do Caucasians.  For example, Millennial participation among non-Caucasians is about 7%, compared to 12% for Caucasians, so the overall participation rate is going to come down.  The encouraging news here is that research has also shown that the relationship between income and golf participation rates holds true for non-Caucasians as well. Therefore, as the middle and upper classes of non-Caucasians grow in coming years, golf participation should increase among these groups.

Our analysis of NGF participation data tells us that demographic trends and income effects account for more than half of the Millennial golf participation drop. The question remains – how much of the shift in participation among Millennials is related to cultural or other changes?  We’re studying lifestyle changes of this age group as we speak, but here’s what we do know.  There are more than 6MM Millennials playing golf right now.  That’s one out of four of today’s golfers.  These Millennial golfers are spending a lot of money on equipment and other merchandise… we estimate about $1 billion a year.  And they are playing about 93 million rounds of golf.  That puts about $4 billion in the cash registers of golf courses each year.  Also worth noting, Millennials who are playing golf are playing a little more often (15 times per year versus 12 times per year) than similarly aged golfers twenty years ago.

One of the most encouraging things we discovered so far is that there is substantial latent demand for golf among this age group.  While there are over 6MM golfers, there are another 12MM+ people who are very/somewhat interested in playing golf now.  That’s two interested non-golfers for every golfer.  This ratio is two times higher than that of any other age group.  These numbers support our theory that Millennials don’t reject golf, they are just delaying entry to the game.  Need a real-life manifestation of this theory? Take a look at Top Golf, a thriving business that combines golf, entertainment, and food & beverage, and which derives the majority of its patrons from the Millennial age group.  NGF believes that the appetite for this product among non-golfing Millennials is the clearest expression of this group’s latent demand for golf.

There is no denying that Gen Y golf participation is down compared to the 18-34 year olds of the 1990s, but we shouldn’t be discouraged.  As we dig deeper into our research, we will gain more insight into this generation and what it will take to get them to the course. Stay tuned for research results NGF will publish later this year.

Project M is sponsored by PGA of America, GOLF Magazine and TaylorMade

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