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PGA Tour looking to tighten belts

Although the PGA Tour is fully sponsored for next year, Commissioner Tim Finchem says plans have been made for replacements if any openings are triggered by the global financial crisis.

Turmoil in the auto and financial services sectors has left the sport vulnerable to the loss of marketing and advertising dollars, and 11 of the Tour’s title sponsors come from the financial sector.

“It would be imprudent for us just to assume that everything is going to be fine and dandy in this environment,” Finchem told Reuters during Saturday’s third round of the Chevron World Challenge.

“We have to assume that we are going to take some hits and that we’re going to have some turnover.

“In preparation for that possibility, we are talking to a range of companies in other industry sectors. It’s a tough environment out there and very few companies are untouched by this downturn.

“But we are making some progress in identifying companies that want to be involved with charity, want to be involved in golf and want to take advantage of the platform. We’ll just have to see how it goes.”

The PGA Tour is highly dependent on corporate sponsors such as General Motors Corp and Wachovia Corp to support its tournaments. GM has warned it is running short of cash while Wachovia is being acquired by Wells Fargo & Co.

Last month, GM’s Buick brand ended its endorsement deal worth an estimated $8 million annually with Woods one year early in a move to cut costs.

On Friday, GM and Chrysler were beneficiaries of a $17.4 billion bailout by the U.S. government.

GM is the title sponsor of two PGA Tour events, the Buick Open and Buick Invitational. Both tournaments are on the schedule for 2009 and their contracts run through 2010.

“Hopefully, the work we are putting in now will pay us some dividends when we get further down the road and see what our fallout is going to be here,” Finchem said.

“Our goal is to come out of this stronger than when we go in and that means if we have to replace a company, we replace it with an even stronger, more focused and more dedicated sponsor.”

In a bid to enhance existing sponsorships, Finchem has sent a video to Tour players and their managers asking them to consider adding tournaments to their schedules and to reach out to sponsors on site.

“There’s always some detail at every golf tournament that can be done better, whether it’s the Masters or any other tournament,” Finchem told reporters on Saturday.

“I think the players are doing a great job, and I think the reason we have been 100 percent sponsored the last 15-18 years is because of the players.”

Although other major U.S. sports organisations have laid off staff because of the economic recession, Finchem said the PGA Tour remained unaffected.

“Layoffs we have been able to avoid to date,” he added. “We have reduced our cost structure in an aggressive way across the board.

“Our strategy is to look carefully at people and if there is an opportunity here or an opportunity there to combine jobs, we will do. But we’re not going to take a let’s cut 10 percent of our work force attitude.”

 

December 22, 2008




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