Can Tiger, Topgolf Take Golf Out Of Rough Times?

Although golf is a top driver among sponsors, consumers and fans, recent developments have put the game in the rough.

This month, No. 1 golf retailer Golfsmith filed for Chapter 11 in an effort to streamline its operation. Nike Golf is in the process of transitioning out of equipment — including clubs, balls and bags — though it said it would "accelerate innovation in its golf footwear and apparel business (and) partner with more of the world’s best golfers.” Adidas has put a major chunk of its golf division up for sale, which includes TaylorMade, Adams and Ashworth.

Still, led by activation from companies including Anheuser-Busch, MasterCard and Coca-Cola, sponsorship spend on golf worldwide is projected to top $1.8 billion this year, up from $1.72 billion in 2015, according to research firm IEG, Chicago.

During the Summer Games in Rio last month, NBCUniversal's Golf Channel ran some 50 hours of coverage of the competition, which returned to the Olympics for the first time since 1904.

According to NBCU, ratings “far exceeded expectations.” Even with such top-ranked golfers as Jordan Spieth, Rory McIlroy, Jason Day and Dustin Johnson skipping the event due to Zika-related issues, the closing holes of the men's competition averaged 8.8 million viewers, ranking it on-par "in every metric for NBC Sports golf events on record."

The number of people watching golf on TV, if for no other reason than curiosity, is expected to get a serious bump with the anticipated return of Tiger Woods, who said he would play in his first events in more than a year, potentially including his own Tiger Woods Invitational (Oct. 10-11) and then the Safeway Open (Oct. 13-16 NBC).

Despite being away from the game due to surgery and rehab, Woods still takes in about $45 million in endorsement deals that include Hero Motorcorp, Kowa and Rolex.

Veteran golfer Phil Michelson is tops among golfers with $50 million in endorsements, including Barclays and Rolex, according to Forbes.

McIlroy’s endorsements, at $35 million, include Nike and Omega. Spieth’s endorsement earnings are at $32 million from such partners as Under Armour, AT&T, Rolex and Coca-Cola.

Day this month signed a long-term deal with Nike, valued at $100 million, to wear their apparel and shoes (but still use TaylorMade equipment).

And Arnold Palmer, the golf icon who passed away on Sunday, had a net worth of some $675 million and, even in his 80s, was still earning millions from endorsements and golf-related property ownership, licensing deals and investments.

Amid this, helping to drive golf to the public, is Topgolf, which in about 30 sports-entertainment destinations nationwide serves more than 13 million guests annually and boasts “the world's largest digital golf audience.”

Each venue features climate-controlled hitting bays and interactive courses with microchip-embedded golf balls that enable users to track accuracy, distance and other stats, enhanced by food, drink, HDTVs and, in some locations, pools and concert stages. 

Topgolf, which launched in the U.K. in 2000 and came to the U.S. in 2005, is in a major expansion mode, both physically and technologically.

The company boosted its interactive platform this year with the acquisition of World Golf Tour, a digital golf gaming community, with more than 14 million players worldwide.

In May, Topgolf aligned with the PGA Tour and LPGA to “create new fans, participants and enthusiasts and enhance the playing and fan experiences through event and media initiatives.”

The first Topgolf Tour, launched in August, has seen competitions at various Topgolf locations. In November, the top players will meet for the championship in Las Vegas in the company’s recently opened flagship location.

Other new locations include Cincinnati, Portland, Jacksonville and the Sacramento suburb of Roseville. 

The Vegas destination, adjacent to the MGM Grand. features across 100,000 square feet on four levels more than 100 hitting bays, 100s of TVs, a concert venue that holds upward of 900 visitors and VIP cabanas and suites.

“This has always been a vision of sports and technology convergence,” said  Erik Anderson, Co-Chairman & CEO for Topgolf. “But we have really evolved the sports and entertainment community.”

Numbers from the National Golf Federation show a dip in 2015 to 24.1 million among those over the age of 6 who played at least one round of golf, down from 24.7 million the two previous years and down from 25.7 million in 2011.

However, figures remained strong in several key areas, including committed golfers, beginning golfers and in the number of people interested in taking up the game, according to NGF.

Topgolf is at the high end of pro active, including expanding its Topgolf Media division.

“We are engaged with sports. And we have become a lifestyle brand where people can come in and have a great time,” said Anderson. “We have in recent years seen a large uptick in the number of women who come to Topgolf, which is fantastic. We are working on ways to keep building interest not just in Topgolf but in golf as a sport.”

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