The Decline of Golf: The Tiger Woods Effect
Tiger Woods is arguably the most recognized golf player in the history of the PGA. His multitude of fans, sponsorships, and accolades has truly made him one of the most successful players not just in golf, but in the sports world. As a result, Woods has earned an estimated personal net worth of over five hundred million dollars. His effect on golf goes beyond attendance and ticket sales, directly affecting the Associations sponsorship deals and TV ratings. After going pro in 1996, Woods immediately started making a name for his self. When he won his first major, the 1997 Masters, he won in a record breaking performance by twelve strokes which instantly propelled him into stardom. By June of 1997 he had ascended to the number one ranking in the world. Following a scandal in 2009 and a decline in performance, Tiger fell to his lowest ranking of fifty eight by November of 2011. After winning the Arnold Palmer Invitational in March of 2013 he again ascended to the number one ranking, where he currently sits today.
In 2009 when the news broke of Tiger Woods’ “unmoral” activities, Tiger saw a flight of sponsors. Nike was one of the few that stuck by him, and still continues to sponsor him to this day. While a multitude of experts expected the company’s golf business to sink, Nike in fact reported two million dollars in sales of Tiger Woods merchandise in the days and weeks following the scandal. The effect for the rest of the industry was not as pleasing. With its biggest star absent, the overall category of golf merchandise lost an estimated ten million dollars in revenue during the absence of Tiger. That fact that Woods had that kind of impact speaks volumes of his effect on golf – the fact that his absence or presence can cost the industry millions of dollars, regardless of whether he wins or loses. Nike Golf president Cindy Davis put its best by saying “He elevates the energy around golf as a whole. Look at the television ratings, with and without Tiger. Look at the PGA tour, attendance with and without him.” (www.cbsnews.com)
2014 marked the first Tiger-less Masters since 1994, and the negative impact was astounding. Not only has his absence affected attendance, but it has directly affected revenue for the PGA. The day after Woods announced that he would not be participating, Stubhub reported a twenty percent decrease in ticket prices, and spokesman Carmen Papp was quoted as saying that “no athlete in the world has more of an effect on ticket prices than Tiger Woods.” Secondary ticket supplier, TiqIQ, reported a sixty six percent decrease in the price of admission for the first round of The Masters. Goviva, a company that provides hospitality services to clients to attend the Tournament, reported a thirty to thirty five percent decrease in the number of corporate bookings to The Masters, and a twenty five percent drop on the hospitality services side of their business, which includes housing, tickets, and transportation. (www.cnbc.com)
The negative impacts have not been strictly limited to ticket sales, and attendance, but have affected TV ratings as well. According to Golf Digest, ESPN reported a 1.5 rating and two million viewers for the first round of the 2014 Masters. Conversely, the first round of the 2013 Masters drew a 2.0 rated with an estimated 2.8 million viewers. Woods has routinely created a tremendous buzz for the networks that telecast the tournament, and has created the most excitement and buzz for the Masters, despite going winless in Augusta since 2005. Sponsors have also felt the pinch of his absence. According to CNBC, the 2013 Masters generated twenty five percent more value per second for player sponsorship than the next closest major on the PGA tour. Tiger’s absence means less airtime for the company’s that sponsor him. Data from Nike, a Woods sponsor, indicated that the company received three times the amount of exposure for Woods endorsements than the company’s next biggest endorsee, Roy McIlory. Translate that to the absence of Woods from the 2014 Masters, and it translates to approximately three to four million dollars of lost exposure for Nike. In a usually mature and competitive market, Nike has been able to go from not having a golf business before 2000 when they signed Woods, to controlling roughly eight percent of the market today. (www.cnbc.com)
One area that appears to be “Tiger-proof” is Woods’ merchandise line. According to Dick Sullivan, the CEO of the PGA Tour Superstore, no noticeable decline in merchandise sales has been noticed, and the Tiger line of merchandise continues to grow as an overall percentage of the stores business. This fact put Tiger Woods in an exclusive category of athletes. Compare his affect to that of the late Dale Earnhardt on NASCAR. Thirteen years after his death, Earnhardt is still arguably the biggest star of NASCAR, and his legacy continues to draw fans and drive up merchandise sales. One can only wonder if Tiger will have this sort of effect once he is absent from the sport for good? (www.golfdigest.com)
In closing Tiger Woods’ effect of the golf industry as a whole may never truly be known. He has propelled companies into the Golf business that otherwise would have never entered it, and has even designed his own courses. He has cemented himself in golf immortality by becoming one of the most successful men to ever pick up a golf club. His ability to directly influence ticket sales, TV ratings, sponsorships, and overall exposure is unmatched by no one. To the average observer it would appear that Tiger has truly made the PGA what it is today, and its success is directly linked to his presence and his absence. Tiger does not need to win in order to create buzz, he simply has to show up.