Golf and television industry executives say they’re not ready to sweat a decline in PGA Tour ratings that has now hit two seasons and is in the midst of a run of nine straight tournaments showing declining weekend viewership over 2003.
But it’s on their minds.
“It’s definitely a concern,” said Jon Miller, senior vice president of programming for NBC Sports, which televised five PGA Tour events this year, finishing with the recent BellSouth Classic. “Nobody’s panicking, but everyone has to take a good look at it.”
Ratings for PGA Tour events declined to an average of 2.8 last year, down from 2.9 in 2002 and 3.0 in 2001, the year the tour signed a four-year, $850 million multinetwork package amid a run of Tiger Woods wins in golf’s major events. That TV contract took effect in 2003.
Now, as Woods has struggled through a winless streak over the last seven majors, ratings have continued to dip. For the nine PGA Tour events between the AT&T Pebble Beach Pro-Am in February and the BellSouth Classic, which concluded April 4, ratings were down for 16 of the 18 weekend telecasts compared to last year. This comes despite the fact that eight of those nine tournaments were determined on the final putt.
Negotiations for the new television package beginning in 2007 will likely take place this time next year, and one golf columnist recently opined that “unless something changes, the networks will hold all the cards.”
But not all golf marketers agree, as they note that television ratings are just one part of a complex equation that still gives the tour considerable strength.
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| Ratings were down a bit for Adam Scott’s win at The Players Championship. |
For instance, the networks are guaranteed a considerable chunk of revenue in the current deal, coming directly from event title sponsors, who have 32 television spots “baked into” each tournament deal. Despite the gradual ratings slide, the tour continues to sign title sponsors — including U.S. Bank just three weeks ago for the former Milwaukee Open — and is as close to fully sponsored as it has ever been.
This speaks to a satisfaction with the status quo, including the TV component, and gives the tour a foundation to build from in negotiations.
“A dip in ratings isn’t necessarily an issue, because the tour makes it clear it’s delivering a specific audience and delivering it better than anyone,” said Nick Paul, vice president and management director of 361 Sports + Event Marketing, which consults for Hewlett-Packard on its golf involvements.
That “audience” is upper-income men who travel, play golf, make investments and buy automobiles, financial services and pharmaceuticals.
But despite golf’s target marketing, the ratings specifics are important, too.
“Buick’s sponsorships [four tournament titlements and an official tour sponsorship] are more than just a TV buy,” said Tim Humes, vice president and director for McCann-Erickson’s Momentum, Detroit, which oversees the Buick account. “But the big concern is that the price of poker continues to increase, and if ratings don’t keep pace, red flags will certainly be raised.”
For clubmaker Callaway Golf, the flag was raised last year, and its current-year television ad budget is “significantly” lower than last year’s, said Patrice Hutin, president and COO. He would not state exact figures, and Callaway does not disclose them in its SEC documents, but the company’s overall ad spending has been between $44 million and $45 million annually for the last three years.
Hutin said the company’s TV budget took a double-digit cut, with the money spent instead on print and interactive advertising and other initiatives that the company could leverage for more involvement. He added that network make-goods on ratings shortfalls don’t benefit the company because they’re rarely in programming that delivers the strong golf demographic.
“Ratings the past few years have been inflated by the Tiger effect, and if the health of the investment depends not only on Tiger playing but being in contention, that’s a very risky proposition,” Hutin said.
Ad buys by clubmakers are down across the board, Miller said, and while overall spending is up marginally this year — thanks to rivalries in the financial and pharmaceutical sectors — golf isn’t profitable for the network. “It’s still a work in progress,” he said. “But one we feel is important to maintain.” Top industry insiders say NBC is not the only network seeing red ink with golf this year.
While some observers point out that even several dramatic finishes haven’t kept ratings from declining this year, Gil Kerr, the tour’s senior vice president of broadcasting, programming and productions, instead touts the emergence of a new group of golfers ready to challenge Woods and help the tour keep eyeballs.
“Adam Scott won the Tournament Players Championship, and the ratings were down just a bit, 3 percent, because you didn’t know him,” said Kerr. “Well, you know him now — an incredibly charismatic, well-spoken, talented player. You can’t depend on one player, and we think there are a lot of great players emerging.”
CBS Sports President Sean McManus said ratings are only a part of the equation.
“What’s equally as important is the overall health of the marketplace … how much enthusiasm there is for advertisers to buy golf,” he said. “There has to be the combination of the two for us to be aggressive.”
