Category: Business
Golf is big business. The most recent figures shows that the golf economy comes to more than $60 billion. Compare that the movie industry’s $57 billion. That’s bigger than the Gross Domestic Product of Peru, Romania, Ukraine or Morocco. How big has golf become? In 1958, Arnold Palmer was the PGA Tour money leader, with $42,000 in winnings. In 2005, Vijay Singh won a little over a million in just two tournaments. This section is devoted to the business of golf.
Callaway Cuts Losses
Callaway Golf has reported that it has cut its third quarter losses to $4.8 million, down from $35 million in the third quarter a year ago.
If charges for its acquisition of Top-Flite were excluded, Callaway would actually have shown a profit.
Much of the turnaround came from a 23% growth in the golf ball market.
PGA Faces Tough Television Negotiations
Businessweek has an article on the weakened position that the PGA finds itself in as it prepares to negotiate a new round of television contracts.
Flush with Tigermania, the networks paid $850 million in rights fees between 2003 and 2006. The thought apparently was that golf was the next big thing in sports marketing.
But as Tiger struggled, so too, did tv ratings.
Now the networks are threatening to cut coverage and rights fees.
And that will produce a good deal of fallout in the golf world, as purses will decline, and smaller tournaments, perhaps, will find themselves out.
As noted before in this blog, one thing the Tour is considering is an end-of-the-year “playoff” similar to the very successful program that NASCAR is running. Players would accumulate points over the course of the season to qualify for the final three tournaments.
The season then would end in September with the Tour Championship, leaving a couple of smaller tournaments in the fall for players on the bubble to try rise up the money list.
The thought is that the “chase” would build excitement throughout the summer, and that it might force the marquee players (read Woods and Mickelson) to play more. (No need to force Vijay to do so).
There also will be a reshuffling of the schedule so that there is a “major” event each month, moving the Players to May, and the Tour Championship up to September.
I actually think that the reshuffling of the season would be enough. Starting in April, you would have The Masters, then The Players, The US Open, The Open (British) Championship, the PGA Championship, and then the Tour Championship in September.
I actually hate the idea of a playoff. The golf season has traditionally revolved around the majors and should continue to do so.
Golf Digest and The PGA Tour Form Partnership
Golf Digest and the PGA Tour have formed a “multi year marketing partnership” in which the magazine and its subsidiaries—GolfWorld, Golf for Women, GolfWorld Business, Golf Digest .com, etc.—become official sponsores of the PGA Tour.
You can read the press release below:
Hurricane Rita Cuts Golf Ball Supplies
You knew that Rita has caused gas shortages that have driven up the price.
But golf balls?
Apparently Acushnet was forced to lay off 200 people following shortages of surlyn—the material used in many golf ball covers—caused by Hurricane Rita’s pounding of a DuPont plant in Orange, Texas.
Callaway To Cut 500 Postitions
In an attempt to return to profitability, Callaway Golf apparently is cutting 500 jobs. Oh, how the mighty have fallen.
