What Tiger Woods Is Worth to Golf and its Advertisers

Tiger Woods hasn't won a major since he returned to the PGA Tour after resurrecting his career from a personal scandal. However, he has regained the top spot in the world rankings. He's also -- love him or hate him -- a huge money generator for all of golf, not just his sponsors like Nike (NYSE: NKE  ) .

The $15 billion problem
Josh Sens of pegs the cost of a missing Tiger at 30% of the $68.8 billion golf industry -- or $15 billion. However, it's just a guess based on the impact of Tiger's absence at golf events throughout the years, which usually causes about a 25% to 30% drop in televisions ratings, according to Brad Adgate of Horizon Media.

One thing is certain -- the drop-off is real and it's significant. Online ticket broker Stubhub reported a 20% drop in Masters' ticket prices one day after Woods announced the major was a no-go. Another ticket reseller, TiqIQ, saw an over 60% decline of sales of first-day badges in the secondary market due to Tiger's injury.

Nike wants Tiger back
Marketing research firm Repucom estimated that Nike would lose more than $3 million of "media value" due to Woods' absence at the 2014 Masters. In 2013, he was featured on air for approximately 50 minutes, which translated into $3.8 million in "media value." Without him, Repucom says the sportswear giant will only get about $700,000 of exposure.

The polarizing effect of Tiger
Here's an interesting thing about Woods. Research by Celebrity DBI, Repucom's sports-marketing research division, shows Woods is one of the most recognizable (98% in U.S. and 80% in the world) and least trusted (bottom 5%) celebrity product endorsers. Adam Scott, who won the 2013 Masters, leads the golfing endorsers, winning the trust of nearly 88% of people in the U.S., followed by Phil Mickelson (86%), who did his part to add to this year's Masters' rating woes by missing the cut. Masters' runner-up Jordan Spieth (85%) garnered great exposure for Under Armour  (NYSE: UA  ) and came in ahead of Nike's other golf pitchman, Rory McIlroy (81%), as a trusted endorser. 

Source: Repucom

People may not trust Tiger enough to buy a product from him, but they sure like to watch him play the game of golf. Whether he wins or loses, drains a long putt or hooks a drive, pumps his fist or slings an expletive, he's good television and he keeps viewers in front of their sets -- and that's good for all of the companies that advertise with and sponsor golf.

Why every advertiser wants Tiger back
This year the weekend coverage of the "Tiger-less" Masters had its worst showing in 20 years, averaging an audience of 8.6 million viewers in 6.4 million homes. The final round had a 7.8 rating, the lowest since 2004, even with future star Spieth vying for Woods' record as the youngest golfer to win a Masters championship. That's a 24% drop from Sunday's numbers in 2013 (10.2 rating) when Scott won and a 35% drop from 2012 (12.0 rating) when Mickelson put on the green jacket. 

Not all of that was due to Tiger's absence, but hardly anybody would argue it had a huge impact. In a sense, every company that moves its brand through golfers and golf should be paying some kind of royalty to Woods, or at least praying he has a speedy recovery. Woods is the only golfer who can move the needle on ratings and that's good for companies across the board.

A Foolish argument
You may not like Tiger. You may not trust him. But even a fool can't argue the fact that he's great for the business of golf. In fact, all other "trustworthy" endorsers' value increases about 30% when Woods steps on the course, as he attracts and keeps 30% more eyeballs glued to the television set.   

Are you ready to profit from this $14.4 trillion revolution?
Let's face it, every investor wants to get in on revolutionary ideas before they hit it big. Like buying PC-maker Dell in the late 1980s, before the consumer computing boom. Or purchasing stock in e-commerce pioneer in the late 1990s, when it was nothing more than an upstart online bookstore. The problem is, most investors don't understand the key to investing in hyper-growth markets. The real trick is to find a small-cap "pure-play" and then watch as it grows in EXPLOSIVE lockstep with its industry. Our expert team of equity analysts has identified one stock that's poised to produce rocket-ship returns with the next $14.4 TRILLION industry. Click here to get the full story in this eye-opening report.

Read/Post Comments (1) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On April 23, 2014, at 11:31 AM, harryho wrote:

    I agree everything. Without Tiger, the game is not interesting. I do not watch TV golf lately.

    LPGA also needs similar star attraction.

    They are in trouble now.

Add your comment.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2925121, ~/Articles/ArticleHandler.aspx, 8/30/2015 2:26:57 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Chris Brantley

Chris Brantley is a contributor at The Motley Fool specializing in sports-related businesses, the food and beverage industry, and whatever else piques his curiosity in the world of business and beyond.

Today's Market

updated 1 day ago Sponsored by:
DOW 16,643.01 -11.76 -0.07%
S&P 500 1,988.87 1.21 0.06%
NASD 4,828.33 15.62 0.32%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

8/28/2015 4:02 PM
NKE $112.50 Down -0.12 -0.11%
Nike CAPS Rating: *****
UA $96.41 Up +0.72 +0.75%
Under Armour CAPS Rating: ****