2003: Business - Doral deal reflects PGA Tour’s auto focus
Whether you’re on site or watching on television, you’ll see Ford’s familiar blue oval logo splashed across Doral’s Blue Monster during this weekend’s Ford Championship.
The automaker, in the first year of a four-year deal sponsoring the Doral event, is the latest in a long line of car brands that have aligned themselves with the PGA Tour in a bid to drive sales.
This week Ford will unveil advertising
featuring pitchman Phil Mickelson, its answer to Buick’s alliance with Tiger Woods. The South Florida Ford Dealers Association has been
promoting the event by offering tickets to people who test drive cars. Ford will have 40 vehicles on display at Doral, with the goal of generating sales leads, and it will supply courtesy cars, which later will be resold by local dealers.
“The target audience, particularly the viewership, is right in the sweet spot of who they market to,” said Keith Bruce, senior vice president and general manager of 361 Sports and Event Marketing, the in-house sports marketing arm of advertising giant FCB Worldwide. “It’s the one thing that car dealers will rally behind and market behind on the local level.”
Ford’s research bears out that fact. According to the company, 34 percent of all golfers own Fords. That figure jumps to 37 percent for golfers ages 30 to 44, and 47 percent for those between the ages of 18 and 29. Rich Stoddart, marketing
communications manager at the Ford Division, noted that these consumers have a “high propensity to own SUVs,” which are highly profitable vehicles.
Ford is hardly alone. No industry supports the PGA Tour as aggressively as the automotive
“All of a sudden, in somewhat of a down marketplace, you have Ford entering the marketplace in a big way, Chrysler expanding its role, and Buick has not stepped down at all with the exception of one event in Georgia, but all they did was take that money and pour it into Tiger,” said John Von Stade, vice president of Velocity Sports & Entertainment, who has negotiated Tour title sponsorships.
Larry Peck, Buick’s golf marketing manager, noted that his brand was the first corporate sponsor of a PGA Tour event, in 1958.
“We’ve seen the value for a long, long time of owning an event for a week,” said Peck. “We find that extremely attractive from a branding
Buick now sponsors three PGA Tour events, plus the Buick Scramble, in addition to its alliance with Woods. Chrysler holds three tour title sponsorships, and Mercedes, Nissan and Honda have one apiece. Andy Pierce, IMG’s senior international vice
president, said other auto brands want a piece of the action.
“We’re talking to a couple of companies on this same subject, on how to expand their involvement if they’re in (golf), or how to get into it if they’re not already,” said Pierce.
These are serious financial commitments. According to various sources, the numbers break down like this: A title sponsor will commit to spending between $22 million and $25 million in direct payments over four years to support an event. A title sponsor can backload a small
portion of payments; for instance, it might spend
Ford, page 37 444
slightly more than $4 million in the first year, with the amount rising to $6 million or more in the contract’s final year.
This year, car companies will spend about $50 million as title sponsors for 10 sanctioned tour events. And Von Stade said a corporation will budget anywhere from $2 million to $12 million annually to leverage that sponsorship locally and nationally. For a company like Ford, which had $163 billion in revenues in 2002, those numbers are easily manageable, particularly if the event energizes the local dealer network. PGA Tour events, with their national television coverage and intensive local media coverage, are tailor-made for car brands.
“Entitlements work best for national companies that are nationally marketed, but are sold locally,” said Bruce.
Gauging return on a sponsorship investment is an imprecise science, and Ford and its competitors closely guard this data. Without offering specifics, Peck noted that Buick sees a spike in sales in the San Diego market after its event there, and Ford will be able track the number of sales leads generated before or during the event were converted to sales.
Pierce noted that IMG has measured car sales 30 days after a tour event and found year-over-year increases of “significantly more than 10 percent in the local market,” and smaller, single-digit gains nationally.
Some believe that Ford already is well on its way to paying for a big part of its golf investment -- Mickelson’s endorsement, which reportedly cost about $1 million annually. Mickelson’s recent dust-up with Tiger Woods and Nike generated a lot of publicity, leading Von Stade to speculate that more than 50 percent of golf fans already know Lefty is aligned with Ford. He applauds Ford for spending aggressively to leverage its Doral deal.
“If you’re going to enter the fray, enter it,” said Von Stade. “Don’t just spend a little bit of money, go after it. And that’s what Ford has done.”