Quail Hollow Golf Shows Upheaval of Sponsorships
By Michael Buteau
May 1 (Bloomberg) -- The Quail Hollow Championship, a PGA Tour event that sold out six straight years, is an unlikely candidate to be suffering from an identity crisis.
While Tiger Woods and other players walk past signs that say “Quail Hollow,” ticket holders have stubs bearing logos of Wells Fargo & Co.’s Wachovia bank.
The scenes around the seven-year-old tournament are a microcosm of the difficulty facing sports sponsors during the worst economic decline in a generation. While companies still want to be associated with powerful athletes like Woods, who ranked No. 1 on BusinessWeek magazine’s list of 100 most influential sports people in October, some would simply prefer to keep their relationships less public.
“Financial institutions are under a different kind of microscope these days,” Steve Rosner, co-founder of 16W Marketing LLC of Rutherford, New Jersey, said in a telephone interview. “They have to be extremely sensitive of how they spend their money, because not only do they have to answer to shareholders, they now have to answer to the government.”
Wells Fargo Chief Executive Officer John Stumpf told shareholders this week that the bank plans to repay $25 billion to the U.S. Treasury’s Troubled Asset Relief Program as soon as possible.
Printed Earlier
All tickets for the golf tournament were printed when the bank said in February that it would take its name off the marquees and stop entertaining clients on the grounds. On the event’s official Web site, all mentions of Wachovia have been replaced with “the Championship.”
Entertaining clients during the tournament could “send mixed signals about our priorities to many of our stakeholders,” Wells Fargo said when announcing its plans. Wachovia’s contract to sponsor the tournament runs through 2014.
The Charlotte-based championship, which didn’t sell all of its tickets this week for the first time, is more fortunate than other events. It’s now named for the host course, the Quail Hollow Club.
Ginn Resorts, based in Celebration, Florida, ended its sponsorship of the 50-and-over Champions Tour’s Ginn Championship. The company also cut its ties with the LPGA’s Ginn Open.
The Quail Hollow winner will receive $1.2 million of the tournament’s $6.5 million purse, which increased by $100,000 from 2008.
Golf Is Hit
Golf has been hit particularly hard around the world.
UBS AG, Switzerland’s second-largest bank, said in March that it will stop sponsoring the Hong Kong Open after this year’s tournament is played November.
Jim Remy, president of the PGA of America, today defended the sport in a letter to USA Today, three weeks after the newspaper ran a column denouncing golf as a representative of “what’s wrong with the USA.”
Golf is a “vital part of America’s fabric” and “most important in these times, a source of stable employment” for more than 55,000 club pros, managers and course superintendents, Remy wrote.
“I think golf has been unfairly targeted but it has been targeted,” said Kym Hougham, director of the tournament. “Everybody is dealing with it differently.”
In other sports, the Chicago Cubs had sued Under Armour Inc. after the sports apparel-maker pulled out of its five-year, $10.8 million contract with the team. The team dropped the suit in April, after the company renewed the agreement, according to the Chicago Tribune.
Yankees Price Cut
The New York Yankees, baseball’s most successful franchise, slashed season-ticket prices for a few hundred premium seats to $1,250 from as much as $2,500 a game after the team played several games in its new $1.5 billion Yankee Stadium in front of rows of empty seats.
DHL, which sponsors Major League Baseball’s monthly and yearly “DHL Delivery Man” awards, ended an agreement with the Atlanta Braves in November, soon after the Deutsche Post AG unit had fired 14,900 workers and closed three-quarters of its outlets because it failed to compete with United Parcel Service Inc. and FedEx Corp. in the U.S.
Anheuser-Busch InBev NV, the world’s biggest brewer, told General Electric Co.’s NBC television network that it plans to cut Olympic ad spending by as much as half, the Wall Street Journal reported this week.
The world economy is in its worst recession since World War II and the International Monetary Fund projects it will shrink 1.3 percent this year.
English Soccer
Still, it’s not all doom and gloom in the sports world.
English Premier League soccer club Everton signed a 10-year agreement with sports retailer Kitbag Limited today that may be worth a club-record 30 million pounds ($44.5 million).
Under the pact, the biggest commercial contract in Everton’s 131-year history, Kitbag will provide worldwide retail services for the club, operate an Everton retail brand and be responsible for shopping, mail order and the club’s online store.
As a contrast, American International Group Inc., the insurer rescued by the U.S. government, said in January that it won’t renew its $22 million-a-year sponsorship of English and European soccer champion Manchester United. British insurer Prudential Plc may replace AIG, the Sunday Telegraph reported last month.
Back on the golf course, as much as the sports sponsorship landscape is changing in places like Charlotte, one thing remains the same: Woods, winner of the 2007 Wachovia Championship, was one shot off the lead after two rounds.
To contact the reporter on this story: Michael Buteau in Atlanta at mbuteau@bloomberg.net
Last Updated: May 1, 2009 18:21 EDT |
