Nike adds Rory McIlroy, golf’s new No. 1, to staff long led by Tiger Woods

January 14, 2013

ABU DHABI — Golf's worst-kept secret was made official on Monday when Rory McIlroy and Nike announced a blockbuster new deal here in a ceremony that Siegfried and Roy would have considered ostentatious. No terms have been made public, but put it this way: the $10.9 million McIlroy recently spent on a Florida mansion is now considered petty cash.

For Nike the deal is a no-brainer. It wants to own a piece of the dominant athlete in every sport and McIlroy, 23, is clearly that guy in golf. (In May 2012, London-based sports business magazine SportsPro rated McIlroy as the second most marketable athlete in the world, behind Brazilian soccer star Neymar.) Cindy Davis, president of Nike Golf, introduced McIlroy on Monday, calling his arrival "one of the most important moments in the history" of the company. The press conference also featured taped messages to McIlroy from Nike icons Tiger Woods, Wayne Rooney, Roger Federer and Phil Knight.

So Nike can now pair the widely admired lad from Northern Ireland with longtime brand ambassador Tiger Woods, whose star power has been dimmed not only by his sex scandal of three years ago but also by the diminishment of his on-course prowess. With McIlory entrenched at No. 1 in the World Ranking and Woods currently holding down the second spot, forthcoming ad campaigns will make much of their burgeoning friendship and rivalry. The first such commercial, which pairs them in a trash-talking game of driving range H-O-R-S-E, debuts worldwide on Wednesday and is already on YouTube. "I grew up watching so many iconic Nike adverts," McIlroy told on Monday in an exclusive interview. "Hopefully this will become one of them."

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For McIlroy the deal comes with more risk. A pre-eminent feel player, he has used Titleist clubs and balls since turning pro in 2009. Few touring professionals spin the ball more than McIlroy, and dialing in the right ball/driver combination will be complicated. For now he will play the VR_S Covert driver and 20XI-X ball, and McIlroy expressed little concern on Monday about his change of tools, saying, "You know me, I don't overthink things. I'm not going to get overwhelmed by changing my equipment. In all honesty, it's been a pretty seamless transition." He noted that his ball speed off the driver has gone up about five miles per hour: "I thought I hit it long before, but this is going to a new level." He will also put into play a Method putter and VR Pro blade irons.

As expected, McIlroy gushed about all of his toys, but he has yet to play them under exacting tournament conditions. Martin Kaymer and Jim Furyk are just the most recent top players to struggle to adapt to equipment changes; both have said they spent more than a year scuffling to get comfortable with new gear. Of course, neither is a Mozart in spikes on the magnitude of McIlroy. As his buddy Graeme McDowell recently said, "He could probably win teeing off with a shovel."

For McIlroy the real challenge may be metaphysical, not technical. The Nike deal validates, and completes, his transformation from a mere golfer to an international superstar. There was already pressure to follow up last season's five-victory, player-of-the-year campaign. Now the spotlight will burn even brighter. Don't forget, it was the Nike publicity machinery that was largely responsible for creating a superhuman image for Woods that proved unsustainable.

But McIlroy is a well-grounded young player surrounded by good people and thus far has seamlessly adapted to his rising fame and fortune. He will continue to lean on a larger perspective, even as he jets between continents, often in the company of his famous girlfriend, tennis player Caroline Wozniacki. "Golf to me now is not the easy part — you still have to work at it — but I suppose the commitments and everything else that goes on around you becomes increasingly difficult the more high-profile you are," McIlroy says. "When you dream of winning tournaments, winning majors, you see the guys on TV, you see them holding the trophy, you don't see the rest of the stuff that goes on. That's something you have to adjust to. I feel like I have now, and it's part of my daily routine and part of my life."

An intriguing question is where this new deal leaves McIlroy on the larger sports landscape. He certainly now ranks among the most lavishly paid endorsers. For months rumors had circulated about the scope of the would-be Nike deal, with the Irish press bandying about the numbers 10 years and $250 million. Industry sources say that last year two other suitors presented McIlroy with deals in the range of five years and $50 million, but those were dismissed as not even in the right ballpark.

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"It's a monumental deal, for several reasons," says Bob Dorfman, an athlete compensation expert and executive creative director at Baker Street Advertising in San Francisco. "It may very well be the largest endorsement deal in history for an active athlete." Derrick Rose's current pact with Adidas is believed to be $183 million over 13 years, while LeBron James's Nike contract weighs in at an estimated $120 million for 10 years. According to Dorfman, Woods signed a five-year, $200 million extension with Nike in 2005, but those figures might have changed. "I have heard that that may have been negotiated down by as much as 50% in the last couple years, due to the scandal and poor sales. I expect he's currently making between $10 to 20 million annually with them."

Woods has traditionally been icy to any player who threatened his dominion, but over the last year his public displays of affection toward McIlroy led to the term "bromance" being worn out by the golf press. A cynic might suggest that Woods was merely being a good corporate soldier and aiding in Nike's recruitment. It remains to be seen if Tiger will continue to play nice now that he's been relegated to the second-most important property at Nike Golf. If Woods remains a polarizing figure, this new deal confirms McIlroy's vast appeal.

"It's definitely the most endorsement dollars ever paid to a non-American athlete," says Dorfman. "The fact that McIlroy is British does not hurt his marketability, though. More than just about any other sport, golf has broad international appeal. It's popular here, in Europe, in Asia, most everywhere in the world. And marketers are definitely thinking globally these days. McIlroy is an athlete who could appeal to and influence a broad demographic, across all continents."

The cross-cultural possibilities of the Rory-Nike alliance were evident during Monday night's glitzy unveiling, which played out with Abu Dhabi's famous Sheikh Zayed Grand Mosque looming in the background. For McIlroy, the Nike announcement capped a whirlwind 15 months during which he changed management companies, relocated to the U.S. and now consolidated all his endorsements into one mega-deal.

"It's been a little crazy, it's true," McIroy said on Monday. "Instead of feeling pressure [with the new deal], I feel relief. I'm excited. Now everything is in place and I can focus on playing golf."

He does that better than anybody on the planet. If that stops being the case, even in the short term, the second-guessing will be fierce. McIlroy knows what he has signed up for. "I just need to keep winning tournaments and everything will be fine," he said, with only the slightest hint of a smile.

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