by By Sarah J.F. Braley | July 01, 2009

0709 Golf mainWhen battling budget woes, some might argue that a golf event is a perk that can be skipped. And that could be true -- or it could be a very bad business decision. Consider the following scenarios.

• The sales team's relationships depend on the hours of uninterrupted nurturing time that a friendly outing allows.

• Cutting the event also cuts a major opportunity to garner new clients or solidify existing client relationships in this tough year.

• Canceling the tournament eliminates the chance to lure much-needed donations back to the organization or a designated charity.

For these solid reasons -- and many others -- the game should go on.

The ROI sand trap
When evaluating the worth of hosting any meeting, solid return on investment makes the best argument. In the scheme of things, measuring golf outings with a charity element is relatively simple. Some parts of the cost of the event are tax write-offs; the attendee response and the amount raised for the charity through entrance fees can dictate whether it is worthwhile to hold again. Getting sponsors to underwrite the tournament gives them the opportunity to look good and cuts your organization's expenses.

But when planners are asked about measuring the ROI of a corporate golf outing, where increased sales is the overt or unspoken objective, the conversation can get a little cloudy.

"I don't think you can say, 'If we do a golf tournament, we'll get x amount of business over time,' " says Jim Rye, president of Rymark International, an Orlando-based site-selection and event management company. In partnership with M&C, Rye hosts one golf and one ski trip each year, bringing his sales team, meeting supplier representatives and meeting planners. While he hasn't laid out the details in an Excel spreadsheet, Rye says he knows about 85 percent of his business comes directly or indirectly from those two events.

For his part, ROI specialist Jack Phillips, Ph.D., refutes the claim that a golf event's ROI can't be measured. As chairman of the Birmingham, Ala.-based ROI Institute and co-developer of the Phillips ROI methodology, he has studied the outcome of every kind of meeting imaginable, including golf outings.

In the book, Proving the Value of Meetings & Events, written with Monica Myhill and James B. McDonough, Phillips details the case of a CEO who was speaking at an annual shareholders' meeting when he was asked about the value of the company's annual golf tournament. Unprepared to answer the question, he came away from the meeting determined never to be in that position again, and he had the event analyzed.

The evaluation showed that 87 percent of the guests said their interaction with the company's executives and sales personnel had a direct and positive impact on whether they would continue to do business with the organization. Also, the study found that the company gained $3 for every $1 spent on the outing. "They did end up having a positive ROI," says Phillips. "I think there are a lot that do. It's a difficult thing to monitor, but it can be done."

Getting feedback
The process of measuring a corporate golf event starts with subtly setting up the attendees to expect some follow-up questions. Phillips stresses the importance of that subtlety, since most golf events begin with the organizers telling players they should just go out and have fun, rather than positioning the event as a chance to talk business. Without laying the proper groundwork, it's hard to go back to the attendees and ask them pertinent questions to calculate the worth of the outing.

The ultimate goal, Phillips notes, is to learn from players "the extent to which the increase in sales you are getting from their company is connected to your golf event."

Phillips outlines a four-part process for evaluating an outing. Level one sets the stage, laying out the messages to be delivered during the event and how the host organization should be perceived as the guests leave at the end of the day. Do you want the company to be seen as selling quality service? Do you want to be seen as an innovative company or as a long-term player in the market?

You also should decide in advance how long after the outing you will measure the guests' response -- whether you'll be looking at sales three, six or nine months later, or at contracts signed by clients who attended or at services sold to them.

Level two is determining if those messages were delivered, which can be accomplished by having salespeople ask the right questions of their clients during cocktail-hour chats or other low-key networking moments on the golf cart or at a meal function held after the event.

Level three is the application: "Did they do what you wanted them to do?" asks Phillips. "Did they check out your products, welcome a sales visit or a briefing?" The fourth part is the tangible impact. Did they buy more? Did sales go up? Was a contract signed?

"It's an expensive process," says Phillips, as hiring a consultant to do the study could cost $15,000 to $20,000. "But if I as an executive wanted to know the real worth of the event, I'd go down this path. If you don't know the answer, you're setting yourself up for some criticism."