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Tiger Woods absence hurts golf financially

April 24, 2014

Sure, it’s a sports story but it’s a business story, too. For all of the mistakes, bad press, and general lack of media savvy Tiger Woods has shown, he’s made golf, and the companies involved in the sport, a lot of money.

To name a few, Mercedes-Benz, Samsung, Pepsi, OfficeMax, all of the major TV Networks, Deere, American Express, and Travelers. Then there are the direct sponsors of Tiger Woods including Fuse Science, Warren Buffett-owned Netjets, Nike, Rolex and more.

Tiger Woods is more than a single sports figure. While the PGA and many of its players might disagree, Woods is golf. No other sport has a single figure that defines it but in the world of golf. When Woods isn’t playing, a whole lot of people stand to lose a whole lot of money.

Take golf’s most prestigious event, The Masters. According to an article on Golf.com, the day after Woods announced that he would miss the tournament due to injury, the price of a one-day pass plunged nearly 20 percent from $1,165 to $940.

TV ratings were anemic. With only a 7.8 rating, that’s a 25 percent drop in viewership, according to Bloomberg. That’s par-for-the-course at any event where Tiger isn’t present.

To be fair, there was a perfect storm of events including the sport’s number two face, Phil Mickelson missing the cut and a lack of any real drama on the final day but the big story was still Woods.

Woods isn’t just a golfer. He’s the face of one of Wall Street’s favorite sports. It’s no accident that some of the PGA’s biggest sponsors are companies that cater to the higher economic class. It’s also no accident that the ad spots seen during a golf tournament include the major financial services companies far more than Larry the Cable Guy peddling acid reducers.

The good news for golf is that content deals are made years in advance making any near-term impacts negligible, but industry analysts say that Woods’ long-term absence or his retirement could be a $15 billion blow to the $68.8 billion golf industry. This includes impacts to brands that rely on the reach of golf to higher economic class demographics that are hard to find in other sports.

Others caution that Woods’ impact might be slightly overblown. Golf survived the loss of Hogan, Nicklaus, Palmer and Norman, but none had the worldwide star power of Woods.

For now, there’s no reason for alarm but the impact from Tiger’s absence from The Masters proves that his presence isn’t only important for golf, but all of the companies involved in the sport.




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