2003 Ad

Golf Digest, Feb, 2004 by Ron Sirak

INSTRUCTION: Players can cash in on direct sale of their image and likeness (video games and trading cards) as well as instructional videos and books. Woods' instructional book, How I Play Golf, has sold more than a million copies worldwide and earned him royalties of $7 million in 2003.

The range of business opportunities open to a player is demonstrated by six-time major-championship winner Nick Faldo: instructional schools through Marriott Resorts, an equipment deal with Nike Golf, course design through IMG, associations with Lloyds TSB Bank and Wingard wines, corporate outings, playing for appearance fees, a Bally clothing contract, a contract for an autobiography, instruction books, a column for The Sunday Times of London and TV work for the BBC and NBC.

LPGA purses have mushroomed from $7 million a year in 1983 to $40.5 million in 2003, and PGA Tour prize money has surged from $17.6 million to $236.7 million over the same time. That growth shows sponsor and TV satisfaction with the game. The off-course explosion of endorsement money shows the corporate world's delight with the players as investments.

"For a sports league to succeed financially it needs two things: labor stability and a geat TV contract," says David Carter, founding partner of the consulting firm Sports Business Group. "The PGA Tour has both. When shopping their clients, agents market that overall stability along with the extremely positive perception of the players' image by the public. In terms of marketing golfers, things will only get better. With no union and a $1 billion TV deal [through 2006] that gives great exposure. They are in relatively great shape at a time when the economy is expected to recover."

That translates into sponsorship dollars for the organizations and endorsement dollars for the individuals.

"Golf is an efficient investment because the golf viewer is a corporate decision maker who supports our corporate market," says Barry Hyde, VP of global sponsorships and event marketing for MasterCard International. "That's where we justify the money we spend for golf."

What's winning a major championship worth?

A major championship is the gift that keeps giving. Not only does it pay off with an immediate large check, but it opens the doors for endorsement opportunities, overseas appearance fees and greatly increases a player's fee for a one-day corporate outing. For an established player like Mike Weir or Jim Furyk the off-course payoff is at least equal to the $1 million prize they got for winning the Masters and the U.S. Open, respectively. In the case of relative unknowns such as Ben Curtis (British Open), Shaun Micheel (PGA) and Hilary Lunke (U.S.Women's Open) the impact is even greater--not in dollars but percentage.

"We have quite a few deals we're negotiating," says Richard Gralitzer, who represents Micheel for Creative Sports Management. "His day rate went up substantially. Also, we have had a very nice Silly Season and have significant opportunities in overseas appearance opportunities." Sources familiar with first-time major winners of a stature similar to Micheel's say he'll earn about $500,000 total in outing and appearance fees in 2004, and a minimum of $750,000 in new endorsement deals--more if he meets bonus goals.