The Coming Tiger Crash: Woods' Absence Spells Trouble For Golf Industry
How much is that Tiger in the window, the one with the bristly disposition and the balky back?
Let’s call it $15 billion. According to one estimate, that’s the price we might ultimately pay if Woods remains removed from competitive golf.
You knew the signs weren’t great earlier this month, when tickets prices for the Masters fell after the Injured One announced that he’d miss the event for the first time in his professional career. Single-day badges, which had sold the day before for $1,165, plunged to $940, a drop of nearly 20 percent.
Small potatoes, right? But then came the tournament itself, which drew a paltry 7.8 TV rating, the lowest since Phil Mickelson's 2004 win on Easter Sunday.
Sure, there were a number of contributing factors: Phil missing the cut; a lack of back-nine drama; balmy weather across an Eastern seaboard that was coming off a brutal stretch of winter.
Still, no one doubted the strongest force at play. Even in absentia, Tiger was the elephant in our living rooms. The Masters, of course, is a different sort of beast, with just three sponsors and only four minutes of commercials every hour. One year of skimpy ratings does little, if any, financial damage to the broadcast network (CBS) or Augusta National itself.
“Those advertising deals were done well before the tournament,” says Neal Pilson, former president of CBS Sports and founder of Pilson Communications, a consulting firm specializing in sports television, media and marketing.
What’s more, Pilson points out, sponsors see the Masters as “a prestige buy, not a ratings buy.” They’re paying for the association with tournament golf’s most prestigious brand. In that regard, Pilson says, Tiger’s no-show “doesn’t really make any difference at all.”
But the year’s first major has come and gone, and the World No. 1 remains a spectator. Word is he’s bound to miss the U.S. Open as well.
What if he lingers on the sidelines?
In the short-term, TV advertising rates for Tour events aren’t likely to change, since most of those deals are locked up in multi-year agreements. But over time, dwindling ratings have a domino effect, influencing more than advertising revenues. Spending tumbles across the industry. Tickets, merchandise, equipment, tee times, golf-related travel -- no sector stands entirely immune.
According to Brad Adgate, senior vice president and director of research for Horizon Media, a New York-based media services company, the 25-30 percent ratings drop we’re accustomed to seeing at Tiger-free events threatens to translate into similar percentage losses across the board.
Adgate and other analysts say it's impossible to a put a precise price tag on Tiger's absence. But if we do the math and arrive at a ballpark number in a golf industry valued at around $68.8 billion, it pencils out at roughly $15 billion. Gulp!
Not that we’re sounding the drumbeat of doom. Golf has suffered downturns before, just as the Tour has survived the loss of its iconic figures: Hogan, Palmer, Nicklaus, Norman. Tiger, of course, outweighs them all in his global impact.
But Rick Horrow, CEO of Horrow Sports Ventures and visiting expert on sports law and business at Harvard Law School, says the prospect of a golf world without him gives us cause to pay more attention. If a Tiger Crash is coming, maybe we should see it as a market correction.
“Life without Tiger can be effectively good for the industry,” Horrow says. “It gets promoters, sponsors and TV executives thinking more creatively, working to cultivate a greater understanding and appreciation for the inherent excitement, tradition and allure of golf.”
That’s a nice thought, but in the meantime: Tiger, get well soon.
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