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Nike & Tiger Woods Part Ways. Mistake. Big Mistake.


Has anyone else been thinking about the end of the Tiger Woods-Nike relationship? Is it just me who has spent considerable time deciphering it? Not just from the point of view of dollars and cents, but also around the lost opportunity and the strategy behind its termination.

 

A little history…

 

Tiger's first contract with Nike was in 1996, where he was to be paid $40 million over five years. In 2001, $100 million; then in 2006, a seven-year contract for $200 million; and in 2013, he signed another contract, the details of which are not public, but you can be sure it was still in the high seven figures per year.

 

Nike stayed with Tiger through his physical altercation and extra-marital PR disaster in the first decade of 2000. The four other biggies - Gillette, AT&T, Accenture, and Gatorade - all dropped him like a hot potato.

 

Nike stayed with him when he was arrested on the side of the road drugged out of his mind. They stayed with him when he went to rehab for sex addiction. And then, of course, there was the accident just a few years ago, where he went off the road without ever using the brake, decimating his leg in the process and severely affecting his ability to compete equally, regardless of how talented the rest of his game was or is. If you can't walk the course, you can't play the game.

 

Enough about Tiger. Let's look at Nike.

 

Nike didn't disclose revenue for its golf division before 2006 and after 2017, but it rose to a peak, and then in 2017, down to $600 million. What can we surmise from this? Tiger's behavior, while abhorrent to someone like me who thinks the person you are is as important as the wins you accumulate, never touched profitability. No one cared that he was a seriously flawed human when they bought his red shirt with the Nike smudge on its breast.


That brings us up to date. Or almost.

 

No one knows for sure who walked away, but with Nike shutting down its club-making operations and its diminishing profitability in the golf arena, one can make a case that Nike did the walking and let Tiger do the talking.

 

"Over 27 years ago, I was fortunate to start a partnership with one of the most iconic brands in the world," Woods wrote. "The days since have been filled with so many amazing moments and memories. If I started naming them, I could go on forever."

 

"Throughout the course of our partnership, we have witnessed, along with the rest of the world, how Tiger not only redefined the sport of golf but also broke barriers for all of sport." Nike said in a statement. "We watched him set records, challenge conventional thinking, and inspire generations of people around the globe."

 

Marketing has changed and continues to change. I think the value of Tiger Woods for Nike was not just about selling golfers tools of the trade - shoes, clubs, clothing, hats.

 

If you were evaluating the financial gains from Tiger's association with Nike, you would have to understand that it wasn't just golfers who followed Tiger Woods through it all; it was Americans who love a comeback story. It was people of color cheering on a winner in an all-"white" sport. Think Arthur Ashe. It was the red shirt and how it intimidated everyone on Sundays, with no one else wearing one. Or knowing that across the course, you could see that red shirt if you were competing and you knew he was on your tail or ahead of you down the fairway, always waiting to decimate you with red power. It was that guy who saw Tiger on social media, even if he didn't watch golf or even play, and then bought Nike because he saw Tiger as a mirror of himself and a window into what he aspires to be.

 

And now he's old. And damaged. And potentially not able to rise one more time like the phoenix he has been. And Nike isn't into golf, even though it's one of the fastest-growing sports in America. Beer-drinking fans at the notorious 16th hole in the Phoenix Open, who surely are not in competitive golfing mode, know Tiger Woods is the best player to have ever lived, even with his flawed background that no other player seems to mirror. Maybe because he's a dangerous personal-risk player. He always Just Did It.

 

No matter what, Tiger Woods never lost sight of going out and just doing it, no matter the pain, humiliation, or anything other than hitting the next shot where he wanted the ball to go. And add in his son; his arrogant, strutting son, who clearly doesn't have humility in his vocabulary but has the talent and doting famous father grinning from ear to ear with every shot he takes in a way he never smiled for his own accomplishments.

 

Marketing content? Are you kidding me? I think Nike should have paid Tiger whatever it cost to continue the relationship, golfing be damned.

 

They should have signed father and son. They should have pitched the following to every single person in America buying a sports shoe or shirt.

 

Just Do It. And, so will he. (Parent-child market) Just Do It. For however long it gives you joy. Just Do It. So many ways to win.

 

I’m not a Tiger fan, and I wonder if the kid will be able to continue to focus as he becomes more and more famous. But, I think Nike is short-sighted if they were the ones that walked away, which I suspect they were.

 

Short-sighted about the aging market and how now, more than ever, I’m wearing comfortable sporting shoes as I try to walk my 10,000 steps a day.

 

Short-sighted about how golf wasn’t the only thing that made Tiger able to sell the smudge shirts and shoes, any more than Michael Jordan's shoe was just for basketball players.

 

Short-sighted about profitability. $600 million in 2017 in sales might have meant you weren't marketing Tiger to the right demographic. Maybe you should have tried expanding his placement before you wrote off his potential payout.

 

The great ad man, David Ogilvy, did the same ads in newspapers for years and years because they worked. When they stopped working, he’d evaluate why and then decide what to do next. He didn't throw away the years of investment without considering more than just the lowered sales that were also based on bad advertising to a small market share.

 

And if Tiger walked away (why would he now?), then maybe he’s going to start his own company as he steps aside from playing and needs the freedom of building his own brand. But I don't see that really.

 

Just think about it.

 

--Christine Merser, Managing Partner, Blue2 Media 

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