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When most athletes slip up in public, they generally have to answer to someone: a team owner, a league commissioner, sponsors, or even teammates. But in today’s sports business, there is no higher authority than Tiger Woods — and therefore there is no template for this scandal and no way for a skittish industry to forecast its toll.
“The hurricane is still going on and everyone is in their cellar waiting for it to blow over,” says one prominent golf agent. “It’s very difficult to condone his behavior, even for all of us who are grateful to Tiger.”
The first cracks in Woods’ empire emerged Tuesday, with the news that all of Tiger’s sponsors pulled TV ads featuring him in the aftermath of his Nov. 27 car accident. According to Nielsen, no Tiger ads appeared on TV last weekend — not even during NBC’s broadcast of the Chevron World Challenge tournament, which benefits Woods’ charitable foundation. Gatorade, which in 2007 signed Woods to a five-year deal worth a reported $100 million, also announced it is discontinuing a line of Tiger-branded energy drinks, though the company says it will continue its relationship with the golfer and the decision was unrelated to Woods’ sex scandal.
“I definitely don’t think golf is benefiting from this in any way,” says Jim Herre, managing editor of Sports Illustrated‘s Golf group, which owns Golf.com and Golf Magazine. “Tiger is greatly diminished, and I think it’s extremely disappointing.”
Nonetheless, nearly all of the companies affiliated with Woods, including Nike, Gillette, and Electronic Arts, have affirmed their commitment to the 33-year-old golf star, even in the wake of near-constant tabloid reports featuring lurid details about his alleged infidelities. Neither Woods nor Mark Steinberg, his long-time agent at International Management Group, have spoken publicly or given any indication about when Tiger will field questions from the media or compete in a tournament. Many golf insiders believe Woods’ first public appearance will likely be in Torrey Pines, Calif., in late January, at a tournament he has won several times and which is located about two hours from his childhood home in Southern California.
The Woods scandal comes at a particularly sensitive time for the PGA Tour. Three events on the 2010 schedule do not currently have title sponsors and another 10 tournaments are in the final years of their sponsorship deals. The Woods scandal comes at a particularly sensitive time for the PGA Tour. Three events on the 2010 schedule do not currently have title sponsors — including the Torrey Pines tournament, which was formerly sponsored by Buick — and another 10 tournaments are in the final years of their sponsorship deals.
Thanks to the uniquely laissez-faire relationship between the PGA Tour and its players, Woods cannot be compelled to play in a particular event or forced to explain himself by PGA commissioner Tim Finchem. To maintain a spot on the tour, players merely have to play 15 qualifying events — and in recent years, Tiger has generally played the bare minimum. He routinely skips established tournaments like the Northern Trust Open in Los Angeles and the Crown Plaza Invitational at Colonial Country Club in Ft. Worth, Texas. “We’re not holding our breath for Tiger,” says a spokesman for the FBR Open in Scottsdale, Ariz., which Woods has not played since 2001.
The scandal may end up forging closer ties between the PGA Tour and Tiger, according to several golf agents and industry insiders contacted by FanHouse. In recent years, Tiger’s schedule has often been a sore spot for the Tour because his presence has such a dramatic impact on TV ratings and sponsor interest. (Ratings for events featuring Tiger typically draw double the number of viewers.)
When the economy was booming, there was often speculation in golf circles that Tiger might utilize his leverage with sponsors to break away from the PGA and form his own tour. It’s not as far fetched as it may seem: As a former champion, Tiger would not need PGA Tour status to play in the four Major tournaments, and it’s likely that he would receive “sponsor exemptions” at nearly any tournament on the planet. In the mid-’90s, Greg Norman explored the idea of creating a new global tour but could not garner the support within the sport.
But after the events of the past couple of weeks? Tiger “needs the PGA Tour now,” says agent Rocky Hambric, who represents former British Open champion Justin Leonard. “He needs their protection, and he and the Tour probably have more mutual interest than they’ve had in a long time.”
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Woods’ ordeal is very different from previous high-profile sports scandals because of the degree to which his sponsors are invested in his brand — and because he has not been charged with a crime. Typically, celebrity marketing deals have conduct clauses that give companies the right to terminate if the athlete is charged with a crime (example: Kobe Bryant), makes a statement or is caught in an act that puts the sponsor in a bad light (Michael Phelps), or is seen utilizing a competitor’s products (Britney Spears). For all the allegations about his sexual predilections, Woods has done none of those things — so far.
It’s very likely, however, that several of Tiger’s sponsors will have to alter their existing campaigns with Woods. In an ironic twist, Accenture, the management-consulting giant, has been running a print ad with Tiger that seems to foreshadow his media frenzy. The spot, which has been plastered in newspapers and airport terminals around the world, features a pensive-looking Tiger looking down at a ball in the rocks abutting a water trap. The tagline: “It’s What You Do Next That Counts.”
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What Does the Future Hold for Tiger Inc.?
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