By GENE YASUDA
Deputy Editor/Business & MultimediaLarry Peck, Buick’s golf marketing manager, is feeling the business effects of Tiger Woods’ absence – and in more ways than one.
Because his company doubles as one of Woods’ top corporate endorsers and as title sponsor
of this week’s PGA Tour stop, Peck is in full scramble mode. His “to do” list: Refund 3,000 ticketholders who paid $50 to $150 to attend a Woods golf clinic at Comerica Park in Detroit. Cut short a Buick promotion that has the world’s No. 1 caddying for the lucky winner. And cross fingers to ensure attendance and media interest don’t drop for the tournament.
“There’s no substitute for Tiger,” Peck says in the understatement of the year.
As the game’s single most dynamic catalyst, Woods – or in this case his absence – is having a rippling effect across the businesses he touches, from tournaments to networks to the products he endorses.
There may be some revenue shortfalls, but likely not as much as people expect: Tickets and hospitality packages for many of the events Woods was scheduled to play this fall sold out long ago. Likewise, network analysts say there’s little, if any, commercial inventory left to sell for the remainder of the season.
The greatest loss from Woods’ hiatus is the very real, yet immeasurable intangible he delivers to the game. After all, how does one even begin to translate into dollars the excitement Woods generated for the sport at the U.S. Open two weeks ago? Most significant, Woods’ absence likely will underscore how much of an enduring brand he has become.
“The whole reason we partnered with Tiger is because he’s relevant whether he is playing or not,” says Jill Kinney, senior communications manager for Gatorade, which recently launched the Gatorade Tiger line of performance drinks.
Indeed, for companies such as Gatorade and Nike Golf that are so intimately linked to their marquee endorser, the concern isn’t a sudden loss of business. It’s more the lost opportunity
to capitalize on sales “spikes” that only Woods can create.
For instance, sales of Nike Golf’s Tiger Woods apparel aren’t likely to slump because the world’s No. 1 isn’t playing. But retailers won’t receive the windfall that usually follows when Woods unveils new Nike shirts or footwear at a tournament.
A major hit Nike will endure is loss of TV exposure. One attempt at quantifying it comes from Joyce Julius. Cited in a CNBC.com report, the sports marketing research firm estimates Nike could miss out on as much as $75 million worth of exposure the rest of the year – based on converting the typical amount of time Woods and his “Swoosh” appear during tournaments into a hypothetical media buy.
Nike officials, however, maintain they’ll continue to get their fair share of TV time. The company’s staff has nine PGA Tour victories to date – more than half coming from people not named Tiger: K.J. Choi, Trevor Immelman, Anthony Kim, Justin Leonard and Stewart Cink, who won last week’s Travelers Championship.
But without Woods, golf on TV will not be the same. Joked NBC’s Jay Leno: “Mathematicians at Stanford University have calculated the smallest number known to man. It’s the Nielsen ratings golf will get without Tiger Woods.”
Steve Dennis, the PGA Tour’s senior director of communications strategy, says “The Tiger Effect” on weekend network broadcasts typically boosts ratings by 29 percent. In the past several years, according to the Tour, when Woods has contended on Sundays, the Nielsen rating has averaged 4.4. When he has finished outside the top 5, the rating has dropped to 3.4. Each network rating point equals 1,128,000 households.
But even if such declines occur in upcoming Tiger-less events, they won’t necessarily result in significant revenue loss or advertiser defection for networks.
“A good part of the extra viewership for Tiger isn’t really the target audience golf advertisers are buying,” says Neil Pilson, president of Pilson Communications and former president of CBS Sports. However, networks may be required to offer “make-good” TV spots to advertisers if audience sizes fall below guaranteed levels.
Audience drop-off is a concern for tournament directors, too.
The BMW Championship, a FedEx Cup playoff event, was to mark Woods’ first appearance in St. Louis. Tournament director Jon Kaczkowski estimates Woods’ absence will cost the tournament $500,000 in lost ticket, merchandise, and food and beverage sales.
Some fans already have called seeking refunds.
Regardless, early fears of huge attendance declines seem unfounded. That’s because Woods mostly plays in premier tournaments that draw big crowds – with or without him.
Officials at the WGC-Bridgestone Invitational and the Tour Championship say
they implemented multiyear agreements for corporate hospitality packages that “locked in” business for this year and beyond. Tour Championship executive director Todd Rhinehart says corporate hospitality and weeklong ticket sales are up 20 percent from last year.
And at the AT&T National, where Woods serves as host, tournament director Greg McLaughlin says corporate hospitality suites have been sold out since May and total attendance is expected to mirror last year’s number of 150,000.
The bottom line: Corporate America will miss Tiger, but the world of business inevitably goes on. In fact, one company that endorses Woods actually may prosper from his absence.
“We’ve got Tiger 365 days a year, albeit in a virtual form,” says Peter Moore, president of
EA Sports, which is set to debut in August “Tiger Woods PGA Tour ’09” – the latest
edition of the popular video game.
“If you need your Tiger fix, the only way you can do it is playing our game.”
– Dan Mirocha and Adam Schupak contributed• • •
Gene Yasuda is
Golfweek’s deputy editor/Business & Multimedia. To reach him e-mail
gyasuda@golfweek.com.
Posted: 6/30/2008
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