It should not surprise anyone with even the slightest knowledge of golf that Tiger Woods does just as well off the course as he does on it. Especially as it relates to product endorsements.
No one in the history of the sport has come close to matching his 2000 earnings of more than $50 million for attaching his name and likeness to a variety of goods and services, from Nike golf balls and American Express credit cards to Japanese coffee drinks and Buick cars.
But he is not the only person on tour making a few extra dollars in endorsements these days. In fact, the market for professional golfers never has been better, and though no one is making anywhere near Tiger money, their bank accounts are still becoming quite flush.
“It has never been a better time for golfers,” says Bob Williams, president of Burns Sports, a Chicago company that helps match athletes and companies for endorsement deals. “Go back just a few years, and golfers were pretty much relegated to endorsing golf-related products. Sure, there were some exceptions, like Arnold Palmer and Greg Norman. But for the most part, that’s the way it was.”
However, Williams adds, a much broader range of golfers are now getting the opportunity to make money as pitchmen for those nongolf companies, oftentimes on a national basis. “Tiger Woods has done some amazing things with regards to television ratings, and that has really opened the eyes of advertisers who previously viewed golf as a elitist, niche sport,” he explains. “Now, after seeing the increases in ratings and the new faces coming to the game, they want to get involved in golf as well, and that has opened a lot of doors for players.”
Rocky Hambric, owner and chief executive officer of Hambric Sports Management in Dallas, is just as enthralled with the current endorsement market. “Overall, I would have to say it’s the best I have ever seen, and I’ve been in this business since 1977,” he says.
Hambric concurs with Williams’ assessment of why the market for nongolf companies has grown so much. “And within the game itself, golf-related endorsements has been helped by the fact that three or four of the giants in that industry have been battling for market share,” he explains. “They’ve been competing hard for players as endorsers, and that has driven up the price for some.”
Among the beneficiaries have been top golfers such as Phil Mickelson and Davis Love III, who recently signed monster equipment deals with Acushnet Co., the maker of Titleist, FootJoy and Cobra products. But with so much money going to the top players, and also to some of the hot young kids coming out of college, a lot of middle-of-the-pack golfers are being left behind.
When marketing executives talk about endorsements, they are referring to the dollars spent on individual athletes to promote various goods and services. The world of sponsorship, they say, generally involves the backing of an event or association. The versatility of sponsorships allows them to achieve multiple business goals, but endorsements often can be a better value to gain exposure.
“By signing a player or players to an endorsement deal, you can take advantage of an affiliation with a sport that has a clean image and do that for about 10 cents on the dollar as opposed to a big sponsorship deal,” Williams says. “A title sponsorship may cost $6 million, but for maybe a tenth of that, you can get a top player, but not Tiger Woods, for a yearlong endorsement deal.”
The primary downside, of course, harkens back to the old adage of International Management Group founder Mark McCormack, who in discussing the differences between using an athlete or an event in a marketing campaign often said: “Bjorn Borg can always break a leg, but Wimbledon can’t.”
However, industry sources are quick to point out that golfers are a surer bet than most other athletes because of their clean image and penchant for staying out of trouble.
“There is a smaller chance for a downside with them,” says Alastair Johnston, a senior vice president at IMG and the head of its golf division.
And a very big upside for golfers, it seems, with an endorsement market that is expected to keep blooming, especially in the nongolf area. “I certainly see that happening,” says Williams. “It’s a growth sport, and golf has clearly captured the minds and hearts of advertisers.”