By Barry Janoff, Executive Editor
April 12, 2010: Marketers who stood their ground and supported Tiger Woods, and those who might be considering joining his roster, received good news during The Masters: Woods still has his competitive edge and still draws major attention both on and off the golf course.
That means such companies as Chrysler, Coca-Cola's Powerade, Verizon, Visa that may be harboring intentions of signing Woods to endorsement deals would go into any such alliance knowing that there is a significant upside in attracting consumers and in building trust.
Woods struggled but finished a solid fourth in The Masters behind Phil Mickelson. But Woods' first appearance on the pro golf circuit since mid-November and his then personal upheaval that engulfed his life drew record numbers on ESPN and had near-record numbers on CBS. ESPN reached 4.94 million viewers on April 8 with its first day of coverage, a 3.6 household rating, That was up 50% from coverage in 2009 and up 80% from 2008, and was the biggest audience a cable network has ever gotten for golf. ESPN continued to roll on April 9, attracting about four million viewers, according to industry analysts, and finished third all-time on cable behind Thursday's coverage and U.S. Open coverage in 2008.
On CBS, which took over third-round coverage on April 10, numbers indicated that ratings were 7.6, about 33% higher than comparable overage in 2009, its highest Saturday numbers since 2001. However, ratings on CBS were higher for its Saturday Masters coverage in 1997 and 2001 (Woods won the event both times).
ESPN made the most of its coverage on Thursday, with commercials that included K-Swiss, ESPN's coverage of the World Cup, New Era with Evan Longoria, the Avatar DVD release, iPad, Michelin, Wrangler with Brett Favre, DirecTV, Jack Daniels, Quaker State and Nike's new Tiger Woods spot. EA Sports also last week broke an online effort to support Tiger Woods PGA Tour Online.
Still, Tiger Woods is half the man he used to be, and (with apologies to Nirvana), he certainly is far from finding a personal nirvana.
Woods' professional career has been defined as much by his marketing endorsements as his victories. In both cases, the numbers are huge. In 2008, Woods earned in excess of $100 million from endorsements, more than twice that of fellow golfer Mickelson, who ranked second among all pro athletes with about $45 million in marketing deals and could see a boost following his showing at the 2010 Masters.
But General Motors, under pressure to restore its shattered economic situation, ended its contract with Woods, taking about $10 million off the table for 2009. When Woods' life-changing Thanksgiving Day accident opened a Pandora's box of marital infidelities and, as Woods himself put it, "lies and deceit," that led to broken alliances with Accenture ($15-20 million), AT&T ($10 million) and PepsiCo's Gatorade ($1-2 million). That took about as much off his sponsorship roster as LeBron James, the leader among NBA players, earns in annual endorsements ($28-33 million), more than Nascar endorsement leader Dale Earnhardt Jr. ($22-25 million) takes in and more than twice as much as Peyton Manning, who leads all NFL players ($13-15 million) sees in endorsement income.
"Do I understand why they dropped me?" Woods said during his press conference at The Masters in Augusta on April 5. "Of course. I made a lot of mistakes in my life and I totally understand why they would do that."
Ironically, among the companies that could see a significant bump due to their alliance with The Masters is AT&T, which is just one of three major corporate sponsors along with IBM and ExxonMobil.
Although companies can adjust the current deals they have with him, Woods still could earn close to $60 million in endorsements in 2010, the majority from a pact with Nike that pays him an estimated $25-30 million annually. EA Sports ($8-10 million) has not only stood behind him but unveiled two titles since December. Gillette ($15 million) and Tag Heuer ($5 million) pulled ad campaigns with Woods but remain aligned with him, along with such marketers as Upper Deck, NetJets and TLC Vision.
"Tiger has admitted and accepted responsibility for his actions. More importantly, he is taking action to restore the faith and trust of his family, friends and fans," said Mike Norton, Communications Director, Male Grooming at P&G's Gillette, which has used Woods in a range of advertising for the Gillette Champions program since 2007. Gillette would not comment on upcoming campaigns, but it seems unlikely Woods will appear alongside such other Gillette spokesmen as Derek Jeter and Roger Federer in the near future. "As a matter of practice, we don't discuss our future advertising plans," said Norton.
Woods said that he and his representatives have been in touch with his sponsors during the months since his accident. "Hopefully I can prove to [them] going forward that I am a worthy investment, that I can help their company grow and represent them well."
However, given the circumstances of infidelity that anchored his downfall, in which his wife Elin and kids were seen as the the ultimate victims, Woods' situation in reclaiming the vital female consumer demographic is more akin to that of Kobe Bryant than other athletes who have recently had ups and downs on Madison Avenue, led by Michael Phelps. In 2003, Bryant topped $55 million in annual endorsements. But when he was charged in Colorado with sexual assault, many of his sponsorship deals were terminated. The case was settled out of court in 2004, but it took years for Bryant to reclaim his marketing status. In 2010, Bryant's endorsements are expected to come in at about $20-25 million, most notably from Nike.
"Women make most of the purchasing decisions in the household, . . . He's toxic right now, especially with the female consumer."— Sue Rodin, WISE
"It's about the power of the purse: Women make most of the purchasing decisions in the household," said Sue Rodin, founder and president of the national organization, Women in Sports and Events, and president of New York-based marketing firm Stars & Strategies. "There is a definite gender divide regarding Woods. Many more women than men are turned off to him as a person and as someone from whom they would buy a product. He's toxic right now, especially with the female consumer."
Indeed, Woods' marketability is hurting across all demographics. According to the Davie Brown Index, which uses national consumer panels to track more than 2,000 celebrities regarding their ability to influence brand affinity and consumer purchase intent, Woods has a lot of work ahead of him. His appeal dropped from 82.3 (out of 100) in January 2009 to 57.2 in March 2010, trust among consumers plummeted from 68.8 to 42.9 during that period and his power as an endorser fell from 77.7 to 51.3, per DBI, which is an independent division of Los Angeles-based Davie Brown Entertainment.
"It is possible that brands with a heavily male demo will be the first to consider using Woods as an endorser again, as they might face somewhat less scrutiny than brands with more of a 50/50 demographic split," said Howard K. Brodwin, Managing Director at sports marketing and brand strategy firm Team Marketing Systems, Los Angeles. "For example, while Gillette did drop him [from marketing] early on during the crisis, I would not be surprised to see them return if their sales have significantly declined since the relationship was terminated."
Nike has remained loyal to the man who presence helped establish the Nike Golf division, and vice versa. (Nike declined to comment for this article.) Woods was wearing Nike golf shirts and hats during practice rounds and on the course for The Masters. The only other visible logo was Woods' personal TW, which appears on his hat and golf bag.
"Those quick to get in the cart with the new Tiger will enjoy loyalty pricing while stealing the brand equity from the former sponsors that left him," said John Meindl, President and CEO at sports marketing and production company SportsBrandedMedia, New York. "The chorus of 'it's the American way, everyone deserves a second chance' will be the mantra of brands such as Chrysler, Powerade, Verizon, Visa and others." (Woods appeared to be drinking Cola-Cola's Powerade during his press conference on April 5.)
EA Sports decision to not back away from its alliance with the beleaguered golfer is less altruistic than financial: The company said that since the launch of Tiger Woods PGA Tour 99, the franchise has sold more than 25 million units worldwide. Tiger Woods PGA Tour 11 is due for release in June) and Tiger Woods PGA Tour Online, which had its official release last week.
"Our focus is on Tiger Woods the golfer, and we have supported him all along," said Peter Moore, president at EA Sports. "We're excited to see how he does."
Moore confirmed Woods' assessment that marketing partners have been in contact with Woods and his management team, led by Leigh Steinberg of marketing powerhouse IMG, since the incident last November. "We talk to his management people every day, in particular with the development of the games," said Moore. "It has been very important to us that we are in full communication with them. And they have been very forthcoming with details. This relationship is much more than a sponsorship deal. His name is on our product and he is in our product." (See full Q&A with Peter Moore.)
TV ratings for golf thus far this year without Woods have been down about 50%, according to industry analysts. That tracks in line with a TV ratings decline in 2008 when Woods had knee surgery. "The game is much more exciting when he's in it than when he's not," said Moore.
As for Woods' future on Madison Avenue, perhaps marketing nirvana is not that far away.
“Once Tiger starts winning that will be the best medicine for restoring his image and rebuilding confidence amongst consumers," said Terry Melia, spokesman for Upper Deck, which has had an exclusive autograph deal with Woods since 2001. "People can’t get enough of him when he’s out on the links, and when he wins, we can’t keep his autographed memorabilia in stock.”