SBJ/July 30-August 5, 2012/Leagues and Governing Bodies

Latin American tour ready, but are sponsors?

Title sponsorship of the new PGA Tour Latinoamerica is proving to be a tough sell.

Tour officials said they likely will start the Latinoamerica tour season this fall without an umbrella sponsor. The PGA Tour has FedEx as its umbrella sponsor, while its U.S.-based developmental tour recently switched to Web.com from Nationwide. The Latinoamerica tour, the PGA Tour’s first series outside of the United States, will be a developmental tour on golf courses throughout Latin America that feeds players to the Web.com Tour.

Mexico’s Yucatan Country Club will host the Latinoamerica tour’s first stop in September.
Photo by: YUCATAN CC
But having an overarching sponsor is not necessary to underwrite the PGA Tour Latinoamerica, which will begin its inaugural season with an event in Mexico in early September. The 11-tournament season will run through mid-December. The Latinoamerica tour is fully sanctioned and supported by the PGA Tour. Tom Wade, the PGA Tour’s chief marketer whose team has been trying to sell an umbrella sponsorship for the Latinoamerica tour for roughly the past year, said the tour will be fully supported this year regardless of its sponsorship status.

“The tour is not contingent on an umbrella sponsor,” Wade said. “It’s important to penetrate the Latin American market as well as develop a following in the Hispanic population in the U.S. … This is a major move for us in the global marketplace. We’re pioneering something that we’ve never done before, in terms of starting a tour outside of the U.S.”

The PGA Tour has been making Latinoamerica tour pitches to brands and agencies in both the U.S. and throughout Latin America. Wade described the marketplace as curious, but it’s clear that finding the right fit will take a lot of legwork.

He said a deal with the tour could be beneficial for U.S.-based companies that are looking to generate awareness throughout Central and South America, as well as for companies that are based south of the border and do all of their business there. But the tour is so spread out, with events ranging from Mexico to Argentina, an umbrella sponsor would want to have a broad base to match the type of wide coverage the tour provides across seven countries.

The PGA Tour Latinoamerica will hit Mexico, Colombia, Brazil, Argentina, Peru, the Dominican Republic and Puerto Rico in its first year. In subsequent years, the tour will grow to as many as 18 to 20 tournaments, said Jack Warfield, president of the tour.

Future events would target Chile, Uruguay and Panama, as well as markets in Brazil, Argentina and Venezuela, proven areas that have a strong golf following.

Argentinian Angel Cabrera, a past winner of the Masters and U.S. Open, is largely credited with driving interest in the sport recently. Others have followed, including Colombian Camilo Villegas and Venezuelan Jhonattan Vegas. With the Latinoamerica tour providing a pathway to the Web.com Tour, the PGA Tour is hoping to provide more opportunities for Hispanic golfers, who could develop into stars in the United States.

“There are big commercial markets in that part of the world and we are there from a TV standpoint,” Wade said. “It’s also something that has the potential to strengthen our appeal to the fastest-growing demographic in the U.S., the Hispanic community.”

The PGA Tour’s own measurements show that interest in golf is growing in those regions. The tour has increased the TV distribution of its primary tour by 228 percent since 2000, increasing the number of available households from 10.2 million to 33.5 million in Latin American countries. That’s nearly twice the growth the PGA Tour has seen in other parts of the world.

Traffic on PGATour.com also has grown in key countries. Daily unique users from Colombia grew from just under 400,000 a year in 2007 to more than 600,000 a year in 2010. Argentina, Brazil and Venezuela have seen strong growth as well, although not to the extent that Colombia did. Traffic from Mexico has been fairly flat.

That growth has been central to the PGA Tour’s selling efforts. Wade’s team also has been emphasizing golf’s re-entry in the Olympics in 2016, saying now is the time to catch the wave as the sport’s popularity grows in that region.

An umbrella sponsorship on the Latinoamerica tour will go for $3 million to $4 million a year, industry experts say, and the PGA Tour is willing to be flexible in how it structures the package.

Many of the standard bells and whistles are included, such as extensive on-course branding, messaging on PGA Tour and Web.com Tour broadcasts, hospitality, eight pro-am spots, tickets, and visits from players.

The media piece would include a highlights package produced by Golf Channel Latin America that will be distributed to various outlets and PGATour.com. There also are plans for a preseason show, a postseason wrap-up and eventually a weekly 30-minute highlight show with the sponsor integrated into the programming.

“We’re in discussions with a couple of companies and we’re taking our time,” Wade said. “We never really expected to have a sponsor for the first part of the new tour and we may not in 2013. But at some point, we’ll find the right partner.”
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