Saturday, October 18, 2008

A preview of things to come

This week the Fry's PGA tournament, this year renamed to the Justin Timberlake Shriners Hospitals for Children , is the future of sponsorship...as soon as next year...and it's scaring the pants off Der Finchem.

..and it's not yet Halloween!

The future for golf next year will be a lack of sponsors...lack of tournaments...lack of TV...lack of audiences...lack of money...and finally, lack of players.

Thanks to The Greatest Ponzi-scheme of all time (house and land-flipping), our country is for sale. The trickle-down effect will be enormous not just in Mom-and-Pop USA, but for fans of all sports everywhere, as sponsors will not be lining up to give money away. Corporate sponsorship is a discretionary expense...that means in particular, that the PGA will lose over half if not more, of their sponsors next year.

You don't need to look to far to see that The Playoffs, where 2 of the sponsors are tar-and-feathered banks, and the other 2 sponsors are getting killed by LIBOR (short-term lending rates) will not be around next year.
I'll predict that the PGA chalks it up to a learning experience and next year cancels the whole Playoff concept. It was an inept attempt to create excitement so TV viewers would tune in to pay for advertisers...but has failed miserably in generating the hype that it attempted to bring. Lack of sponsors will only hasten its demise.

Looking at the whole PGA schedule (pre-Playoffs and Fall series), 9 of the tournaments are sponsored by banks, and other than the US Bank tournament in Milwaukee, I don't see any re-upping next year (especially The Memorial which this year was presented by Morgan Stanley...eeesh!) good luck with that one Jack!

6 PGA events have car sponsors...ok, John Deere isn't a car, and they will probably re-up (a big boo-ya to the Midwest! Thank God for agriculture), but as far as Tour players being shuttled around in Buick's...well, forget it. It's time to put them back in the garage.

So that leaves a handful of events that might retain the same sponsors for next year, but make no mistake there will be a huge scramble for dollars...and the PGA will need to make major concessions to get or keep them. This will be at the expense of fans, tournament organizers and the players, but I guess the biggest losers in this whole situation will be the charities, who plan their budgets around the generous contributions of the PGA and their sponsors. It won't be there next year and that, in MyDailySlice terms...will suck.

Time to dig out the Survival Handbook:

For the PGA to survive and thrive next year, they will need to cut down the amount of tournaments they play in the US, as supply is way over what the demand will be. They need to cut out the Playoffs and the Fall series and add more International play. This will create a supply constraint in the US, the result being the revenue per tournament will rise, and quality sponsors will ante up for that. By going overseas, the PGA can flex its muscle into weakened economies and expand its brand into new high growth markets and new advertisers.
The majors have nothing to worry about, and that's why I think they will make 2 more Majors next year...the Players, and either the Memorial or another foreign Major. Once a major, sponsorship is never an issue because of the value of high quality.

These are going to be extreme times for sports...as there is a smaller dollar pie that will be shared for all. The ones that make extreme changes will save the only thing that counts in sports...image. Image brings dollars.

I will leave you with a silver lining that I read in today's WSJ. During the depression, golf courses were having a hard time staying open. A young Bobby Jones, in an attempt to keep his new golf course in Augusta from the grasps of demise, invited the world's best amateurs and professionals to Magnolia Lane for a weekend of golf. This sincere invitation by the world's greatest golf ambassador was later renamed...

...to The Masters.


Thanks for reading. Keep it in the short-grass,

JFB

3 comments:

Mr Business Golf said...

I wholeheartedly agree with you one. I am expecting Finchem to ask for a bailout come this next year. I am certain the Nationwide tour may be sacrificed to keep the main show own...I don't even think Tiger will be able to help keep the PGA going. I hate to see it, but it looks like there will eventually be only two golf events to watch on TV and that is the Masters and the British Open.

PS: my new blog site is at www.scotduke.com

Par Fore said...

All good points. However, over the last couple of weeks we've heard so much about the global economy and foreign banks having just as much of a problem as the US has had in both areas.

Cameron Strachan said...

It doesn't look good for the PGA Tour. I think they're in a better situation than many other tours though...

The Aussie Tour is in all sorts of trouble (some would say they've been in trouble for years) with major issues finding sponsors for our two biggest events. It looks very bleak over here. There's no wonder the good Aussie players head to the US to play.

I do think that Tiger coming back will help - God help golf if he doesn't get back soon.

Good golfing,

Cameron