WORLD GOLF - Repucom

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Insights by Repucom

WORLDGOLF

FROM TEE TO GREEN

The state of play in golf

today.

©2015 Repucom Insights by Repucom

3

WORLD GOLF

Paul SmithFounder and CEO, Repucom

Golf today is a sport that transcends entertainment, lifestyle, health and community. It is a multi-billion dollar industry that is experiencing some of its most tumultuous times.

A beacon in these difficult times, professional golf is arguably at its zenith; a new generation of players with diverse personalities are congregating at the top of leaderboards around the world, providing an enticing new dynamic for fans, broadcasters and sponsors.

Golf fans are now able to watch these rivalries develop in new ways, as the major tours and broadcasters deploy new technologies and platforms to meet the demands of a social and digital age. Tournaments, sponsors and players, meanwhile, are increasingly building a platform in social media as a way to engage with fans and promote themselves.

Geographically, too, changes are afoot. The traditional heartlands of golf, North America and Europe, remain at the top of the rankings in terms of view-ers, interest and, at mass participation level, even number of golf courses, but other markets, primarily Asia, are joining the party. The growth of the game in the emerging markets highlights the global context of golf, particularly the profes-sional game. For a long time, The European Tour has pioneered these regions and has built a global framework that has delivered new fans and revenues.

Despite all these positives the underlying challenges for golf, declining play and associated consumption, remain. The 2016 Olympics will put golf back into a very historical sporting context, but it is no quick fix. The traditional con-fines of golf will need to be challenged from within to create an openness to change; a concerted effort to engage former and future players in an innovative way is the pathway to growth.

2015

CONTENTS04 I FANS

Interest by market and what golf fans are buying.

10 I SPONSORSHIP The major brands and how they activate.

14 I EVENTS A multitude of options for brands and fans.

18 I PLAYERS The impact of winning and the relationship with brands.

In collaboration with IMG and the HSBC Golf Business Forum, Repucom carried out a survey of the global golf community – the golf industry and who subscribe to the Golf Business Community – during August and September to gain an insight into the current state of the game, its tournaments, the sponsor-ship landscape, the spectator experience and how the sport’s future is shaping

up. Respondents were predominantly male – 84 per cent versus 16 per cent female – and nearly a quarter each came from the United States and United Kingdom, where the golf industry is most established and mature. 39 per cent of respondents said they play golf themselves.

WORLD GOLF INDUSTRY SURVEY 2015 – WHO TOOK PART?

Golf sport Journals Print

< 29 25%30 ‒ 49 49%50+ 61%

Social Media (e.g. Facebook, Twitter, YouTube)

< 29 78%30 ‒ 49 76%50+ 39%

Specific TV Broadcasts (live, replay)

50+ 88%30 ‒ 49 84%< 29 69%

THE STATE OF THE GAME

Asked to use one word to describe the current state of golf, significant differences in sentiment emerged amongst age groups.

The younger respondents tend to be hold a more positive view of golf; im-portantly, fewer under-29s believe the sport is declining than the older age groups. The use of words such as ‘stagnant’, ‘stale’ and ‘steady’, particularly from the older two age categories, point to a perception of a lack of progress. Some of the most-used words included:

Up to 29 years

Changing, Competitive, Crossroads, Declining,

Democratisation, Depleting, Elitist, Expansion,

Expensive, Fragile, Good, Growing, Healthy, Hopeful, Improving, Old, Optimistic,

Rebounding, Slow, Stagnant, Struggling,

Technical, Underachieving, Underplayed, Youthful.

30-49 years

Challenging, Changing, Declining, Exciting, Fun, Global,

Rising, Stagnant, Stale, Steady, Struggling.

50+

Challenging, Declining, Elitist, Exclusive, Good, Pressure, Rising, Stable,

Stagnant, Struggling.

Multiple responses

WHAT DOES THE INDUSTRY THINK ABOUT ITSELF?

SPONSORS

Underlining that the respondents were largely members of the golf industry, the unprompted brands awareness scores were high. BMW, Nike, Titleist, Rolex and HSBC achieved the higher scores in this survey, suggesting that these sponsors are achieving a high level of cut-through amongst the keenest followers of the game.

CONSUMPTION

Clear differences emerged amongst the three age groups when the industry was asked about how they consume media, particularly around use of social media and television.

72% of respondents say new

media platforms would have a positive impact on golf, while

79%

would like to see improvements in broadcast coverage using

technology, such as better replay systems and other innovations

such as those demonstrated by Fox, CBS and Sky Sports during

golf coverage in 2015.

SPECTATOR EXPERIENCE

Asked what would improve the spectator experi-ence at tournaments, there was a strong response, regardless of age group or gender, for more player interaction – it is a unifying theme. Those under 29 also want more hype and social interaction; those aged 30 – 49 are keen for stadium course designs, more seating and better viewing opportunities; those over 50 expressed a desire for cheaper tickets.

Higher importance over

80%Athletics

Swimming/AquaticsCyclingTriathlon

medium importance over

50%Basketball

BoxingGolf

ShootingEquestrian

less importance below

50%BadmintonTaekwondo

Rugby

HOW IMPORTANT IS THE OLYMPICS TO THE PROFILE

OF DIFFERENT SPORT?

4Fans

5Fans


Source: Sports DNA (May 2015)

FANSIn markets where golf is emerging, there is an opportunity to promote golf as a more gender- neutral sport to a younger group of fans.

GOLF FANS IN 2015

The average age of the golf fan differs significantly by market, as the se-lected list below shows. While established golf markets such as Canada, the UK and the USA each have a fan average age of above 40, the other end of the spectrum features a cluster of growing and developing golf markets – the average age of the golf fan in Turkey and the United Arab Emirates, two grow-

ing markets is below 35. This demonstrates that in new golf markets, the sport is attracting a younger audience and, as the second table on this page shows, often posi-tioning itself as a more gender-neutral sport, as opposed to some of the more traditional golfing nations.

Average age of golf fans by market

Male/Female interest in golf by %

Despite being a sport traditionally dominated by male interest, the gender gap has dropped to around 60:40 in many major markets around the world. In a market like South Korea, a country which has enjoyed much success in the women’s game thanks to the likes of Se Ri Pak and now Inbee Park, female in-terest has reached 40 per cent. Although the gender gap is wider in some mar-kets such as France and particularly Australia, where men make up over 70 per cent of the golf fanbase, the picture is different in some of the developing golf nations. There is nearly an even gender split in interest in Turkey, for example, while the gender split in Italy is particularly striking for a country in one of golf’s traditional heartlands, Europe.

Sout

h Ko

rea

45.7

cana

da

44.8

Japa

n

43.6

UK

41.7

USA

40.5

Aust

rali

a

39.9

Aust

ria

39.4

spai

n

39.4

Italy

38.9

Sing

apor

e

38.3

Thai

land

38.2

Fran

ce

37.8

Germ

any

37.8

Mex

ico

35.7

Mal

aysi

a

35.5

UAE

34.3

Turk

ey

33.2

29.1

Aust

rali

a

70.9

Aust

ria

34.6

65.4

Italy

50.5 49.5

Cana

da

65.5

34.5

Fran

ce

61

39

Germ

any

64.6

35.4

Japa

n

39.6

60.4

Mal

aysi

a

63.8

36.2

Mex

ico

57.2

42.8

Sing

apor

e

39.3

60.7

Sout

h ko

rea

40.1

59.9

Spai

n

41.1

58.9

Thai

land

44.4

55.6

Turk

ey

47.952.1

UAE

14.5

85.5

UK

33.6

66.4

USA

34.4

65.6

Source: Sports DNA (May 2015)

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SportsDNA is the world’s larg-est multi-client study in sports, based on more than 30,000 interviews in over 30 countries. Research is conducted twice yearly amongst 16 – 69 year olds and a nationally repre-sentative sample.

6Fans

7Fans


GLOBAL INTEREST IN GOLF

North America and Europe are golf’s traditional heartlands, in terms of inter-est, watching the professional game and participation. But interest, amongst 16–69 year olds, is growing in other regions; indeed, across Asia and Oceania and the Middle East, interest levels in golf are now higher than across Europe. Drilling down into individual markets, however, shows that over a quarter of the

population has an interest in golf in five markets: South Ko-rea, Thailand, USA, Turkey and the United Kingdom. By population, the United States and China dominate, fol-lowed by Japan and Mexico. Just over 10 per cent of the population in Brazil currently have an interest in the sport.

South Korea 33Thailand 33USA 30Turkey 25United Kingdom 25Singapore 24Japan 24Malaysia 23Canada 23Mexico 22 Australia 21Italy 20 United Arab Emirates 19New Zealand 18Spain 17France 17Austria 16Germany 16Argentina 15Sweden 14Brazil 11China 10Russia 10Poland 10Netherlands 9South Africa 8Indonesia 3India 1

GOLF FANS: WHAT ARE THEY BUYING?

Historically, golf has enjoyed tremendous support from the financial services industry and the value of the sport to that sector is clear: golf fans are far more likely than the average person to use or purchase credit cards and insurance. Golf fans are also far more likely than the average person to purchase sports-wear – unsurprising given the links between professional golf and the leisure side

Top 5 by %

Participation

SERVICES AND USAGE INTENTION

Top 5 by %

INTENDED PRODUCT PURCHASESWhat they currently use or intend to purchase in the next 12 months What they currently use or intend to purchase in the next 12 months

Golf fans are also more likely to buy a subscription TV package, take flights for business and leisure and are twice as likely to use sports betting services than the average person.

OF THOSE WHO ACTIVELY PARTICIPATE IN SPORT, HOW MANY PLAY GOLF?

Aust

rali

ans

5.7%

cana

dian

s

9.3%

Japa

nese

9.9%

Sout

h af

rica

ns

3.4%

Sout

h ko

rean

s

12.6%

brit

ons

6.9%

amer

ican

s

7.7%

USA 68China 54.7Japan 20.5Mexico 17.3Thailand 16.9Brazil 13.3United Kingdom 12.3South Korea 10.2Turkey 9.6Germany 8.8Italy 8.3Russia 7.9France 7.4Canada 5.7Spain 5.7Malaysia 4.7Argentina 4.2Australia 3.4Poland 2.7Indonesia 2.3South Africa 1.7India 1.6 Singapore 1.1Netherlands 1.1Austria <1Sweden <1United Arab Emirates <1New Zealand <1

Interest by market (top 2 box)

USA

30

Australia

21

UK

25

South Korea

33

Southafrica

8

Japan

24

MARKET INTEREST

MARKET MILLIONS OF PEOPLE

TOTAL 291.06

MILLION

in percent

GLOBAL AVERAGE

17.7%

Banking/ financial services

Mobile network/ wireless service

Quick service restaurants (fast food)

Credit card

Insurance

69

68

65

63

62

golf fan

68

70

64

53

57

average person

Soft drinks/ beverages

Mobile devices

Healthcare Products

Sportswear

Consumer Electronics

Consumer Electronics

73

65

63

60

60

golf fan

76

65

63

48

58

average person

% interest by selected markets

of the game. The link between the professional and partici-pation strands of the game has been a major topic of de-bate for many years. Nearly eight per cent of the Americans who actively play sport, play golf along with around seven per cent of Britons and one in ten Japanese adults.

Italy

20

spain

17

Source: Repucom SportsDNA (May 2015)



8Fans

9Fans


MEDIA COVERAGE AND CONSUMPTION

Golf has been a television sport for decades – the 1947 US Open was broadcast locally in St Louis, the BBC in the UK broadcast its first Open Championship in 1955, while the first Masters broadcast, an hour per day, was provided by CBS to the United States in 1956. Increasingly sophisticated and blanket coverage of tournaments and tours has followed, complemented in recent years by interactive coverage, additional streaming and dedicated apps offering statistics, alternative camera angles and other content. Television, though, remains the dominant medium for golf fans to find out information about their favourite player or news about a tournament: over 97 per cent of

golf fans use television as a sports information resource, compared to 90 per cent of the average population.

But golf fans are also major users of social media and mobile devices, utilising the platforms far more than the av-erage person to find and consume information about sport – over 85 per cent use social media compared to 66 per cent of the total population, while nearly 87 per cent of golf fans are using mobile devices to read or watch sports news.

Media used for sports information (%)

Venues with a strong focus on music events and without a sports team as anchor tenant are in bold.Source: Repucom Market Intelligence

EMBRACING DIGITAL: PGA TOUR LIVE

In April the PGA Tour announced a multi-year partnership with Major League Baseball Advanced Media (MLBAM) to create and produce a new OTT subscription service, providing additional live coverage of its events.

Designed as a complement to existing tournament television broad-casts, the service, PGA Tour Live, debuted at July’s Quicken Loans Na-tional PGA Tour event, with coverage of the morning groups during the first two rounds and, when the Golf Channel’s US television coverage began, featured holes.

As it debuted the service was priced at $4.99, with initial availability in selected markets including the US, Canada, Australia and United King-dom. In all, the service has been trialled at seven 2015 PGA Tour events, before a broader rollout next year.

“PGA Tour Live is an important development for golf fans, as it will bring live action to the devices they use most, while building great momen-tum and viewership for the ensuing broadcast coverage each weekday afternoon and into the weekend,” said Tim Finchem, commissioner of the PGA Tour, as the new service was announced. “Working with MLBAM was a natural fit, as it was a top priority to find a partner to meet the challenge

of delivering the digital hybrid our fans want most – a live HD broadcast with world-class technology distri-bution. ”MLBAM has established itself as a class leader in developing OTT solutions and platforms. It has previously worked on streaming service projects for HBO, Playstation, ESPN and the WWE.

CASE STUDY

Key market interest in Major championships

PGA Tour coverage is split between CBS and NBC in the United States, with the most recent contracts, signed in 2011, running to 2021. In addition, the tour has a cable broadcast rights contract in place with Golf Channel, which also runs until 2021. In 2014, UK broadcaster Sky Sports signed a new seven-year deal to broadcast PGA Tour events live until 2022, in a deal including more on-site coverage. Sky Sports also has the live UK rights to the European Tour, plus the Ryder Cup.

In 2016 the broadcaster will provide live coverage of all four Major tourna-ments for the first time, after picking up the exclusive live rights to The Open Championship after the BBC pulled out of its deal a year early. The BBC will continue to broadcast free-to-air highlights of each round, and also has live weekend coverage of the Masters until 2017.

In the United States, Fox replaced NBC this year as the broadcaster of United States Golf Association events, in-cluding the US Open, after agreeing a 12-year deal. NBC, meanwhile, is to replace ESPN as the US broadcaster of The Open from 2016 after signing its own 12-year deal. NBC also has a contract with the PGA of America to broadcast every Ryder Cup until 2030.

Alongside state broadcaster CCTV, online broadcaster LeTV – Leshi Internet Information & Technology – has picked up the Chinese rights to a slew of international golf tours and tournaments over the past year as it rolls out its sports service.

golf fan74 92

average person

Daily newspapers

golf fan

79 95average person

Internet

golf fan

62 87average person

Magazines/ sport magazines

golf fan65 87

average person

Mobile devices

golf fan90 98

average person

golf fan66 85

average person

Social media

tv

golf fan69 88

average person

Radio


Augusta NationalMasters

US PGAPGA of america

Interest levels in golf’s four an-nual Majors differs significantly by market. In the USA, where three of the four tournaments are held, the Open Champion-ship unsurprisingly has the low-est interest levels. But despite a similar timezone there are strik-ing differences in interest levels for both the US PGA Champi-onship and the Open between Japan and South Korea.

NEWSLETTER

golf fan53 81

average person

Email Newsletter


22.6% 16.5% 19% 12.7%

21.3% 12.8% 6.4% 21.8%

17.8% 19.4% 18.7% 9.8%

21.8% 17.1% 15.3% 23.1%

japanUSA UK south korea

Open championShipR&A

US OpenUSGA

Pho

to: G

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es

10Sponsorship

11Sponsorship


Golf attracts significant sponsorship for its major tours, tournaments and players, with format changes including the European Tour’s Race to Dubai and the PGA Tour’s FedEx Cup recently presenting new options for brands.

GOLF’S GLOBAL SPONSORSHIP SPEND

Professional golf in all its forms offers a variety of sponsorship platforms and levels of investment, from entire tours to individual tournaments, players to teams and governing bodies. The sport boasts some of the longest standing sponsorship agreements in sport and retained brands from traditional catego-ries like watches, cars and financial institutions, such as Rolex, BMW and HSBC, through the global financial crisis. But despite these challenges the ex-pansion of calendars, implementation of new formats and geographical shifts

have opened up opportunities for new sponsors and cat-egories, while new funding models, including from govern-ment and tourism agencies, have also proved successful for tournaments around the world. These agreements hinge on the direct and indirect economic impact a major golf tournament, with all the attendant media attention and spectator spend, can bring to a region.

The global spend on golf sponsorship 2013 ‒2015

$ 2015 1.6BN

2014 1.55BN

2013 1.45BN


CASE STUDY

PATRICK FITZGERALD – SENIOR VICE PRESIDENT OF INTEGRATED MARKETING AND COMMUNICATIONS, FEDEX

“We recognised a lot of connections between our brand and the at-tributes of golf and the PGA Tour – things like reliability, global focus, a diverse workforce. We got into conversations with the tour about the con-cept of the FedEx Cup, which really has transformed the sport in terms of the calendar. It has an intensity and drama that attracts the best golfers and fans around the world.

“Having somewhat of a blank slate to create that was more attractive for us than just taking over an existing sponsorship or system that was already in place. We are in our ninth year of our FedEx Cup sponsorship and to see how quickly it’s grown and how firmly established it is now really demonstrates that the need was there.

“Clearly with events happening year-round, globally, it does give us an opportunity to host and allow our team members to connect at local events, but the other very strong connection that we have is that we con-nect the FedEx Cup with our FedEx Cares programmes, our charitable focus and community-based activities, where we have thousands of vol-unteer hours around the globe and tens of millions of dollars in support and in-kind shipping that we provide to communities where we do busi-ness around the world.

“We have great familiarity with the various sports and sponsorship opportunities and how they connect with our customers; we are very impressed and pleased with the connection that we have through golf and the PGA Tour.”

SPONSORSHIP

World number one Jordan Spieth celebrates his 2015 FedEx Cup victory.

Source: Repucom Market Intelligence

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12Sponsorship

13Sponsorship


THE HEAD-TO-TOE MODEL

Sportwear giant Nike continues to be the largest corporate spender on golf around the world, not least through its head-to-toe sponsorship of Tiger Woods over the past 20 years and, more recently, a similarly all-encompassing deal with Northern Ireland’s Rory McIlroy. The head-to-toe model, which restricts players from wearing other logos whilst on-course, has also been adopted by Under Armour, which has Jordan Spieth under contract until 2025. “You work from the endemics and work your way out – apparel, shoes, playing equipment, golf

clubs,” explains Carlos Fleming, who as Senior Vice Presi-dent of Talent Marketing for IMG represents another Nike ‘clean apparel athlete’, US star Michelle Wie. But whilst golf has a number of rising talents and a new generation of established, top-level players, it is the major sponsors of Woods and his old rival Phil Mickelson which continue to dominate the list of largest player sponsorship agreements.

Sponsorship sector analysis

Tiger Woods

NikeHero

MotoCorp

Phil Mickelson

KPMGCallaway

Nike

Rory McIlroySource: Repucom Market Intelligence

Pho

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AFP

HSBC’s recent renewal of its global golf sponsorship programme, a port-folio including the World Golf Cham-pionship-HSBC Champions, HSBC Women’s Champions, The Open and the Abu Dhabi HSBC Golf Champi-onship, underlines the continuing im-portance of the banking and finance sector to professional golf. It remains the largest sector in terms of spend, ahead of apparel companies such as Nike, Adidas and Callaway, and car manufacturers, including Mercedes-Benz, BMW Group and General Mo-tors. Just under a fifth of the global spending on golf sponsorship rights fees comes from the consumer goods market. The tourism sector, made up of government agencies and hotel groups, is a relatively new category, a reflection of the attrac-tiveness of hosting a professional tournament and golf’s global status.

REMAINING CATEGORIES

28%

BANKING & FINANCE

18%

APPAREL

15%

AUTOMOBILE

13%

CONSUMER GOODS

9%

IT – SOFTWARE & HARDWARE

7%

FREIGHT AND LOGISTICS

5%

TOURISM

5%

Under Armour have signed Jordan Spieth, seen here at the 2015 Open Championship, to an exclusive head-to-toe sponsorship agreement until 2025.

Top 5 player sponsorship deals

Source: Repucom Market Intelligence based on analysis of over 700 deals globally

14Events

15Events


EVENTSProfessional golf tournaments generate major economic impacts for host regions, while on the participation side Asia is becoming a major force alongside North America and Europe.

THE PROFESSIONAL GOLF CALENDAR

Like all major sports, golf’s sponsorship landscape is diverse, with various governing bodies, tours, promoters, tournaments and players all presenting commercial opportunities for brands.

The men’s professional golf season is dominated by the four ma-jor championships – the Masters, US Open, Open Championship and PGA Championship.

Although there are several other tours, such as the Asian Tour, two dominate the golf landscape at the highest professional level. America’s PGA Tour and the European Tour are in constant competi-tion for players and eyeballs, but both manage to co-exist, not least in recent times by tweaking formats to help retain interest and attract or retain the best talent.

The FedEx Cup, introduced by the PGA Tour in 2007, concludes with four play-off events – in 2015 they were The Barclays, the Deutsche Bank Championship, the BMW Championship and the Tour Championship. The winner claims a US$10 million prize, part of a total US$35 million prize fund.

The European Tour, mean-while, has introduced its own seasonal narrative device over the last decade. Since 2009 the Race to Dubai has run through-out the season, culminating in the DP World Tour Champion-ship at Jumeirah Golf Estates – DP World is a Dubai-based shipping logistics company.

The European Tour has also broken free of the continent’s borders, running tournaments successfully in South Africa, the

United Arab Emirates, Malaysia, Thailand, India, China, Mauritius and Morocco. In August, the European Tour announced an ‘innovative joint vision for the future of professional golf’, with the Asian Tour.

Every two years room is found in the crowded calendar for team matchplay events – the Ryder Cup, between the United States and Europe, and the President’s Cup, between the US and a team comprised of the best non-Europeans from elsewhere in the world.

Senior tours and second-tier competitions, such as America’s Web.com Tour (formerly the Nationwide Tour) and Europe’s Chal-lenge Tour, and their affiliated tournaments open up other commer-cial possibilities.

Women’s golf is structured in similar fashion: the LPGA Tour and Ladies European Tour are the major seasonal contests, but each year is also peppered with major tournaments. For the past three years, women’s golf has had five major tournaments

per season – in 2015 they were California’s ANA Inspiration (for-merly the Kraft Nabisco Cham-pionship), the KMPG Women’s PGA Championship, the US Women’s Open, Ricoh British Women’s Open and France’s Evian Championship. The Sol-heim Cup, held every two years, is the Ryder Cup-equivalent for the women’s game.

In 2016, every top-level tour will be punctuated by a trip to Rio de Janeiro for the return of golf to the Olympic Games, at an under-construction course in Barra da Tijuca. The men’s and women’s tournaments will fea-ture 60 players.


CASE STUDY

THE MAJOR: THE MASTERS

Professional golf’s most traditional and romantic tournament, the Masters, held each April at Augusta National Golf Club in Georgia and organised by the club’s committee, plays largely by its own commercial rules. The Masters brand is fiercely protected by the organising commit-tee, so much so that live television coverage is still restricted to a set number of hours per day. CBS, host broadcaster in the United States, has shown the Masters every year since 1956, although its deal is be-lieved to be renewed every year. Along with other broadcasters around the world, such as Sky Sports and the BBC in the UK, CBS is restricted in what it can broadcast live. The 2015 tournament had just five sponsors: IBM, AT&T and Mercedes-Benz were the three global partners, with Rolex and UPS designated as ‘international partners’. With branding rights so limited, the sponsors are collectively granted four minutes of advertising time per hour during live broadcasts on CBS across the US in return for a multi-million dollar spend.

David Horsey, the winner of the European Tour’s Made In Denmark tournament in 2015.

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16Events

17Events


Professional golf is inextricably linked to the leisure side of the game inso-far as golf courses, even those built and promoted as championship courses, need to exist as businesses beyond their annual PGA Tour, European Tour or Asian Tour events. The global market is a multi-billion dollar industry, which has touchpoints with real estate and tourism, comprises private and public facilities, and which has spawned a multitude of course architects, designers, maintenance firms and other services and suppliers. According to data from the National Golf Foundation, published in a report commissioned by the R&A,

golf’s governing body, earlier this year, there are over 34,000 golf facilities in the world, spread over 206 coun-tries, with nearly 700 others currently under construction or at the planning stage. Of the 34,011 existing courses identified, just under 80 per cent are located in ten coun-tries: the USA, England, Japan, Canada, Australia, Ger-many, Scotland, France, South Africa and Sweden. 2016 Olympic host Brazil currently has 123 courses.


CASE STUDY

THE WORLD GOLF CHAMPIONSHIP: WGC – HSBC CHAMPIONS

The HSBC Champions has been played each season in China since 2005 and from 2009 became one of four tournaments per year played under the World Golf Championships (WGC) banner. The group of events, which also feature the Cadillac Championship, Cadillac Match Play Championship (which will be renamed the Dell Match Play from 2016) and Bridgestone Invitational, was created in 2009 and are sanc-tioned by the International Federation of PGA Tours (made up of the

Asian Tour, European Tour, Japan Golf Tour, PGA Tour, PGA Tour of Australasia and the Sunshine Tour) and the China Golf Association. The tournament, widely regarded as the closest event to a Major in Asia, is played for an overall purse of $8.5 million and is promoted by IMG. HSBC has been title sponsor since the tournament’s inception.

CASE STUDY

The John Deere Classic was one of 47 FedEx Cup tour-naments on the PGA Tour’s 2015 schedule. The tournament, won in this year by Jordan Spieth, has a prize purse of $4.7 million. Traditionally it is been played the week before the Open Championship (organisers invest in a Sunday evening charter flight across the Atlantic in order to encourage as many of the world’s elite players as possible to compete) but next year’s edition will take place in August to accommodate the return of golf to the Olympic Games. Staged since 2000 in Silvis, Illinois, the tournament has been sponsored by Illi-nois-headquartered construction equipment manufacturer John Deere since 1999. In July, the company signed an ex-tension to its title sponsorship deal and to its wider market-ing relationship with the PGA Tour. The tournament will now be known as the John Deere Classic until at least 2023.

THE TOUR EVENT: JOHN DEERE CLASSIC

Now following the same format as the Ryder Cup, the first Solheim Cup took place in 1990 and the most recent edition, played in September, saw the US regain the trophy following a dramatic comeback against the European team. The matchplay and team formats are popular on TV and in-ject a dose of tribalism into what is mostly an individual sport. The Solheim Cup is co-sanctioned by the Ladies European Tour (LET) and the Ladies Professional Golf Association (LPGA). Germany hosted the competition for the first time in 2015, while the Des Moines Golf and Country Club will stage the 2017 edition back on US soil. In 2015, SAP and Allianz joined the Solheim Cup sponsorship roster, alongside exist-ing global partners Ping and Rolex. Aside from traditional broadcast agreements, the 2015 event was the first to also be made available live via YouTube.

THE MATCHPLAY: SOLHEIM CUP

CASE STUDY

Number of courses by nation

BEYOND PROFESSIONAL GOLF: TOURISM, LEISURE AND DESTINATIONS

New and planned courses

Source: R&A Golf Around the World 2015 report

Source: R&A Golf Around the World 2015 report

Although there are a sizeable number of new and planned projects in North America and Europe, the sport’s traditional heartlands, the growth in Asia (including the Middle East) and to new re-gions, such as eastern Europe, is clear – there are, for example, new golf projects planned or under-way in no fewer than 27 Asian countries. Accord-ing to the R&A report, there were 185 new course openings in Asia between 2010 and 2014 com-pared to 155 in Europe and 58 in North America. Over the past five to ten years, meanwhile, some 110 courses have closed across Europe, 108 in North America and 73 in Asia.

Planning Under Total construction projects

Asia 115 92 207

North America 124 76 200

Europe 119 40 159

Africa 34 31 65

South America 12 18 30

Oceania 23 12 35

The economic impact of a major event

RYDER CUP 2010: CELTIC MANOR, WALES

The 2010 Ryder Cup, held at the Celtic Manor resort near Newport in Wales, offers a prime example of the local, regional and national eco-nomic impact value a major golf event can deliver.

» Total Direct Economic Impact for Newport: £28.3 million» Total Direct Economic Impact for South East Wales: £74.6 million» Total Direct Economic Impact for Wales: £82.4 million

The direct economic impact figure for Wales was created predominantly by spectators (68%), followed by contractors (17%), hospitality (11%) and volunteers (4%)

1

USA

15,372

2

Japa

n

2,383

3

cana

da

2,363

4

Engl

and

2,084

5

Aust

rali

a

1,628

6

Germ

any

747

7

Fran

ce

648

8

Scot

land

572

9

Sout

h Af

rica

512

10

Swed

en

491

11

Chin

a

473

12

Irel

and

472

13

Sout

h ko

rea

447

14

Spai

n

437

Jordan Spieth reflects on another PGA Tour victory, at the 2015 John Deere Classic The Solheim Cup was staged in Germany for the first time in 2015

15

New

Zeel

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418

Source: Repucom Market Intelligence

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PLAYERSA new generation of social media-savvy leading players have emerged in the both the men’s and women’s game, playing around the world and helping to drive new audiences to the sport.

ENDORSEMENT POTENTIAL

Celebrity Davie Brown Index (DBI) is Repucom’s tool to measure the pub-lic’s perceptions of over 8,000 personalities across 15 markets around the world, (including Argentina, Australia, Brazil, China, France, Germany, India, Italy, Japan, Mexico, Russia, Spain, Turkey, the UK and the USA), represent-ing the views of over 1.5 billion people.

It can look at specific demographics, including age groups and income groups, to give a clear identification of how audiences consider a personality or sportsperson. It enables users to compare specific markets and show the changes in the perceptions over time, critical considerations for brands un-locking the power of celebrity endorsements. These perceptions are meas-ured against eight key attributes which when combined provide an overview

of that person’s marketability, including the extent to which people regard the celebrity as a trend-setter.

Taking the world’s top ten male golfers as a guide and using the USA as an example market, Repucom ex-amined the awareness and then, for those that are aware of them, the trend-setter score of the sport’s leading players to create a new 2015 ranking. Although Rory McIlroy is the most recognisable of the top ten in the United States, it is Rickie Fowler who tops the list: of the one in five Americans aware of him, 81 per cent regard him as a trend-setter.

Official World Golf ranking as of 11th October 2015. / Source: Celebrity DBI

THE IMPACT OF WINNING ON AWARENESS

There are many successful professional golfers and the world ranking list is filled with effective and proven brand endorsers from across Europe, Asia, South Africa, Australia and the United States. But winning still matters most and over the past two years or so golf has been undergoing a generational shift, with a new group of players establishing themselves at the very top of the game.

Five of the last six Major Championships up to the end of 2015 have been won by Rory McIlroy, Jordan Spieth and Jason Day (only Zach Johnson’s play-off victory at the 2015 Open Championship prevented a clean sweep by the top three in the world rankings). McIlroy, who has four career Majors currently to his name, won the final two Majors of 2014, while Spieth won the first two of 2015. Day, a perennial challenger, recorded his first Major victory in August, winning the US PGA Championship.

The impact and importance of winning is underlined by Repucom’s Celeb-rity DBI tool, which shows that between March, prior to his victory at the Mas-ters, and July, by which time he had also won the US Open, awareness of Spieth in the United States had jumped from 19 per cent to 37 per cent. Simi-larly, awareness of Australia’s Jason Day in the United States moved from 19 per cent in April to nearly 25 per cent in August, following his Major win. In 2011, ahead of McIlroy’s US Open victory only 17 per cent of the US population

had heard of him. Following his victory, that number had jumped to over 48 per cent of the total population.

While Tiger Woods, through his years of domination, remains by far and away the best known golfer, his declin-ing form and injury has allowed a new generation to pros-per. There is, though, much to be said for enduring appeal, particularly in a sport which places such a value on history and tradition.

The career of a professional golfer tends to be longer than that of the average sportsman; the decline in competi-tiveness can be gradual, often culminating in a slot on one of the lucrative senior tours on either side of the Atlantic.

For players who have reached the twilight of their ca-reers, there can also often be broadcast analyst jobs avail-able, while many players, including several of those still active, have embarked on golf course design projects. It is not uncommon for golfers to remain highly visible to the public long after their trophy-winning days are over.

The world’s top ten by trend-setter Celebrity DBI score

US awareness Trend-setter

1. Rickie Fowler (world ranking 5) 20% 81%

2. Jordan Spieth (1) 37% 80%

3. Jason Day (2) 25% 80%

4. Bubba Watson (4) 39% 78%

5. Rory McIlroy (3) 42% 75%

6. Dustin Johnson (8) 21% 73%

7. Zach Johnson (10) 23% 70%

8. Henrik Stenson (6) 15% 70%

9. Justin Rose (7) 19% 64%

10. Jim Furyk (9) 23% 59%

Trend-setter

81%

Rickie Fowler

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CASE STUDY

THE LPGA TOUR’S MICHELLE WIE

Carlos Fleming on the agent’s role“I represent athletes both domestically in the United States, but also

globally, such as athletes like Michelle Wie in golf, and international tennis players. My job is to do all of their brand development, endorsement and marketing work outside of the playing field – for example, with US sports we don’t negotiate the team contracts but we negotiate all the endorse-ment deals, we put together their whole marketing strategy. That could include publishing deals, television deals, you name it.”

On golf versus other sports as a commercial platform“I think the biggest differences are between global individual sports

like tennis and golf and sports that are more popular in domestic markets like American football and basketball. With the Major League sports that are more domestically focused, a lot of our marketing and endorsement opportunities are coming from league partners because you find often-times that it’s a pretty high priority for companies to partner with the leagues and then form partnerships with some of the athletes. In individ-ual sports, brands have first to be convinced to invest in the sport on a global basis and then they look at the athletes which make the most sense for them to invest in. You’re oftentimes not just selling the sport, but your individual athlete and some of their unique attributes – and that might even convince a brand that’s not interested in golf to invest in a golfer,

because they learn more about the demographics of the fans through the data that Repucom can provide, in terms of the likeability scores and so forth.”

On the commercial prowess of women’s golf“With Michelle, I just think she finds unique op-

portunities that might not be available to other LPGA golfers just because of who she is, what she repre-sents – having such a high profile at a young age, going to Stanford and graduating from there, the fact she is interesting, attractive, an artist, she’s not afraid to take risks in the fashion space, she’s multi-cultural. All of those things make her unique, and a non-tradi-tional golf type. She’s willing to put herself out there on social media. When fans and brands and the me-dia look at her, it’s a lot harder to put her in a box.”

On managing a player’s time“You have to look at the key levers, which are the

amount of money they want to pay and the number of service days. Sometimes we’ve got down to one day – one four-hour appearance day – in a negotiation and she’s had to say no sometimes because adding that one day next to four or five other sponsors, the days they need, and the amount of time you get in the off-season and for training, that really leaves you about 30 or so days during the course of a year to service your sponsors outside of tournaments. A lot of these sponsors want access during tournament weeks as well, when the core audience is there and you can’t really commit to doing that too often or you won’t be ready to play. We have to be very mindful of the services and matching that up to the price point a sponsor is offering and having a balance.”

On engaging a younger audience“My experience in sport is that you have to take

the sport to where the people are and without diluting the core following you have to come up with ideas that engage younger people, whether it’s clinics, whether it’s player appearances, visibility with that audience. You’re never going to change the way the game is played and how expensive it can be for some people and you’re never going to change where peo-ple are playing golf, typically, on more of a local level – it is more of an elite sport so I think you have to make it feel more accessible to people who aren’t typically thinking about playing golf.

GOLF AND THE OLYMPIC GAMES

Golf returns to the Olympics next year in Rio de Janeiro for what will be the sport’s first appearance at the Games since 1904. The return was con-firmed by the International Olympic Committee in 2009 and represents a ma-

jor opportunity to develop and promote the sport around the world, and attract and retain a younger, more gen-der-neutral audience.

GREATER GLOBAL EXPOSUREThe Olympics offers sports, even those as well established as golf, a platform for exposure like no other event and beyond a sport’s usual fan base. FedEx’s Patrick FitzGerald points to basketball’s impact at the 1992 Olympics as an example of what could follow. “You could make a comparison with what the 1992 US ‘Dream Team’ did internation-ally, following those Olympics,” he says. “Hopefully the sport will have an infusion of excitement and a growth spurt with future generations, espe-cially in non-traditional golf countries. When you look at the NBA and the international players there now, 20-plus years after the 1992 Olympic Games, plus the NBA’s international shift in general, it’s clear what hap-pened following those Games. You can expect some similar growth coming from golf.”

GREATER SHOWCASE FOR PLAYERS – AND BRANDS

For both players in developing golf markets and established players in more traditional golf markets, a suc-cessful showing at an Olympic Games offers exposure to a potentially new audience. “As someone who covers both the Olympic and golf space I be-lieve the potential for athletes to reach a wider audience through Rio 2016 is profound,” says Michael Pask, Senior Vice President of IMG Golf. “Similarly the opportunity to work with some of the most sophisticated marketing pro-grammes in sport will be both exciting and financially rewarding. Rio presents an amazing opportunity for any golfer to make history and it is fundamentally why both interest and investment is drawn to the unique nature and scale of the Olympics. Golf as it progress-es in the Olympic space can as such learn a lot from how tennis has truly embraced the Games”.

Michelle Wie hits an iron during the LPGA Malaysia tournament in October.

26-year old Michelle Wie has been a professional for a decade and is now an LPGA and Solheim Cup regular. She won her first Major in 2014 at the US Women’s Open. She is represented by Carlos Fleming, Senior Vice President of Talent Marketing, at IMG.

GREATER FUNDING FOR NATIONAL GOLF ASSOCIATIONSGolf will be one of 28 sports at Rio 2016 and each international federa-tion receives a slice of the IOC’s rev-enues – in London the IOC distribut-ed $520 million to this group. A similar amount is expected to be ear-marked for international federations following Rio 2016. Sports are tiered, with athletics, gymnastics and swim-ming making up Group A, which will receive the largest slice. Although golf has been placed alongside mod-ern pentathlon and rugby sevens in the fifth and final group, it still ensures the International Golf Federation (IGF) will receive a multi-million dollar sum which will ultimately filter down to national golf associations to help further develop the game.

RIO 2016

The impacts of golf’s Olympic return

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Copyright © 2015 Repucom. All rights reserved. Repucom and the Repucom logo are registered trademarks. Other product and service names are trademarks or registered trademarks.

All content herein is copyrighted. Any reproduction must contain a credit to Repucom.

All pictures copyright of Getty Images pages: 4, 9, 11, 14, 15 (at the bottom), 16, 18.

The Front cover is provided by AFP also all pictures on pages, 10, 12, 13, 15 (at the top), 19.Back cover: Shutterstock/Yellowj

Trends, challenges and opportunities facing the golf industry in 2015 and beyond, as identified by Repucom.

Olympic inclusion, starting at Rio 2016, offers a major devel-opment and promotional plat-form, with increased funding in more markets.

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The need, like all sports, to em-brace the digital world – the PGA Tour’s new OTT service is a prime example of how golf is tackling this; there is a need to engage the younger demo-graphic through effective use and then monetisation of social media channels.

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Further establishing and strengthening the link between the pro-fessional and leisure sides of the sport – does the professional game drive participation? – and main-taining tournament quality where tours rely on promoters to host and organise their events.

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Golf offers a multi-tude of sponsorship options and proper-ties – from entire tours, to individual events, teams, play-ers and golf broad-casters.

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The new leadership in place at the top of the sport – Martin Slumbers at the R&A, Keith Pelley at the European Tour and (Deputy Commis-sioner) Jay Mona-ghan at the PGA Tour; new thinking at the top of the sport?

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Slow play and the length of the game have potential implica-tions for television and partici-pation rates, especially in the current ultra-competitive sports and entertainment market.

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The matchplay mod-el: popular on TV, injecting a dose of tribalism into what is usually an individual sport, the Ryder Cup model has been rep-licated with events like the Solheim Cup, Presidents Cup and the EurAsia Cup.

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The world’s top players tend to be strong ambassadors for the game and are generally spon-sor-friendly; pro-ams offer a (nearly) money-can’t-buy expe-rience for sponsors or guests and gives great access to the star players.

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… And in Jordan Spieth v Rory McIlroy, with others like Jason Day and Rickie Fowler thrown in, golf can now point to a genu-ine rivalry at the very top of the game; a different dynamic following the era of Tiger Woods’ domination.

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Like all sports, the onus remains on golf to draw in new fans, particularly Millenni-als with whom golf currently has limited relevance – urban golf, shorter, punchi-er tournament for-mats, wi-fi availability for spectators on-course.

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The role of the wider golf indus-try: the influence of equipment manufacturers, course design-ers, real estate owners and other stakeholders.

15 The European Tour spreading far beyond its geographical boundaries; strengthening links with the Asian Tour and the ‘Race to Dubai’ format.

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In spite of the financial crisis, major, high-end sponsors – the likes of Rolex, HSBC and BMW – have been retained, demonstrat-ing the power of golf as a sponsorship platform ...

17… But new sponsors and alter-native sponsorship models and categories – government tour-ism agencies, for example – have been created and honed in recent years, and expansion into further categories (social media and technology) and partnerships with ‘edgier and more youth-driven’ sponsors (e.g. Under Armour) needs to happen to drive future growth.

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Aside from the major tours – notably the PGA and European Tours – golf has established and well-supported development and seniors tours around the world. These can also be valua-ble sponsorship opportunities, although these tours face a chal-lenge in attracting audiences.

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Strengthening of the Women’s Tours and major women’s golf properties like the Solheim Cup (last year’s Turkish Ladies Open trialled a Sunday-Wednesday format, as opposed to the usual Thursday-Sunday – a good ex-ample of such innovation).

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Making the sport as accessible as pos-sible, to remove the perception it is elitist and bound by tradi-tion …

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… But ensuring that the traditions that make the sport great – the Masters, the Open, the game’s etiquette, for exam-ple – are protected.

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