PGA Tour counts true cost of Tiger Woods fallout

18 December 2009

NEW YORK: The well-documented troubles facing Tiger Woods will cost the PGA Tour, and associated TV and merchandising operators, at least $220 million (€153m; £136m) in lost revenue next year.

The golf star's indefinite leave from the sport, announced amidst a blaze of publicity earlier this month, is likely to deprive the sport of its biggest attraction, and will have a knock-on effect on the entire game, according to Aaron Cohen, chief media negotiating officer at Horizon Media.

"There will be an audience for the sport after Tiger Woods, but it'll be far smaller because he attracts a casual fan who otherwise may not tune in," he said.

Basing his forecast on the dip in PGA viewing levels when Woods was out of the game with a knee injury last year, Cohen estimates that TV audiences may shrink by half, and TV advertising by 40%, without the presence of the world number one.

He believes that while the initial dip in TV audiences and the potential 20% reduction in tournament crowds will hurt broadcasters initially, while merchandisers such as Nike could face problems, too, if Woods decides to sit out the entire year.

The apparel brand, which has built its golf equipment business around the appeal of Woods, stands to lose more than $30m in sales, according to Claire Gallacher, an analyst with Capstone Investments.
Organisers of the annual PGA Tour itself are likely to feel the effects of recent events later, when networks seek to renew TV rights at far lower prices.
”It's not so much a ripple effect as a tsunami,” said Rick Gentile, a former CBS Sports executive producer. "The aura is gone."

Data sourced from Bloomberg; additional content by WARC staff