Don’t lose any shut eye being concerned about the financial state of the PGA Tour. As you can read in Matthew Futterman’s article in the Wall Street Journal the beds of Tim Finchem, the PGA Tour, and the players fortunate enough to stay in the top 125 and cash in on the weekly spoils are all amply feathered with Jacksons as the tour has successfully navigated itself through the first Post-Tiger period.
After Tiger’s run in with the hydrant and the resultant free fall from grace because of personal indiscretions exposed, the PGA brass was very worried that the golden calf that his fame had help create was going to be seriously devalued without his persona dominating our Sunday television screens.
Apparently the sport had more self-sustaining momentum than they thought and with a fresh crop of young and talented players from the global golf pool stepping into the void the product proved as attractive as ever to the two parties that matter the most-the TV broadcasters and the corporate sponsors.
Futterman points out that the new nine-year TV contract inked in 2011 with NBC and CBS represented an average of about $800 million a year-a 33% increase over the expiring agreement. The tour revenues for last year rose over $90 million (close to 10%) in a year when most businesses were just trying to figure how to eke out a low single digit increase in this sputtering economy.
Every one of the 42 PGA Tour events has a title sponsor kicking in anywhere from $6 to $12 million for the event. Uniquely these sponsors commit to buying around 75% of the ads during the broadcasts, this is a huge hedge for the television broadcasters who have put so much on the table. Viewership has continued to grow robustly justifying their outlays.
As Futterman says, the PGA Tour has succeeded in redefining the story of the tour. It is now way more than one dominating force in a red shirt on Sunday-it includes Bubba Golf and Ricky Golf and Rory Golf and so much more. The pot of gold is there for the players and more of the great athletes of the next generation will be proudly wearing soft spikes and bright colored shirts (with white pants of course) trying to dip their hands in that stash.
Against all the odds the PGA Tour has managed to redefine it’s attraction and connect with more folks than ever. Just listen to that resonating ka-ching….it is louder than ever.
(Click to read Matt Futterman’s WSJ article on the PGA Tour)
Wall Street Journal