"You can’t just look at ratings and say the sport has a problem. People who say that don’t know what they’re talking about.”
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Yet tour executives remain confident that their next TV deal will bring increases from their current six-year, $2.95 billion contract, thanks to a business model that the tour’s network partners call the best in sports.
“Everyone looks at the ratings, but because of our business model, a decline in ratings doesn’t impact the bottom line like people think,” said Ty Votaw, the tour’s executive vice president of communications and international affairs.
“We make money for our TV partners. You can’t just look at ratings and say the sport has a problem. People who say that don’t know what they’re talking about.”
For PGA Tour events in 2010, CBS averaged a 1.4 rating on the weekends, down 26.3 percent from 2009, and NBC’s numbers averaged a 1.6, down 33 percent. Average viewership was down 31 percent to 32 percent on the two networks as well.
Why would advertisers want more eyeballs? Less is more! All is well. We're delivering value, so who cares if no one watches! What a world.
Those numbers and the uncertainty swirling around Woods led several industry executives to position the tour at an economic crossroads this year, with the TV talks at the center. Many just hope the tour can keep its right fees where they are, much less get a raise.
“The tour has done a pretty amazing job with the last couple of TV negotiations. They’re going to have their hands full on the next one,” said Mark Steinberg, IMG Golf’s global managing director. “It’s up to the tour to provide as much value as possible.”
Our first v word mention. Ty explains that it's simply the tour delivering 65 to 75 percent of advertisers over the season which has the networks sounding downright jovial.
“The tour contributes significantly,” said Seth Winter, NBC’s senior vice president, sports and Olympic sales and marketing. “They really are the archetype for the league and media relationship and they show it by really understanding the needs of the network. They are the best.”
Title sponsors of tour events that are televised by CBS or NBC typically pay about $8 million a year. Half of that goes toward the media buy with the network that carries the tournament and the other half goes directly to the tournament and contributes significantly to the purse.
“The tour has done an excellent job with their title sponsors and laying a strong base of media support for the property,” said John Bogusz, executive vice president of sales and marketing for CBS Sports.
Now here's the real shocker.
Some consider $4 million to be an expensive ad buy for simply units within golf programming, but it also comes with branding on several in-broadcast elements for the title sponsor, such as graphics and the leaderboard, as well as the obligatory “message from the CEO,” the staged interview the network does with the title sponsor’s chief executive. The contracts guarantee a certain number of mentions for the title sponsor on air, and the networks typically surpass those, the tour said.
Those interviews are staged? Heartbroooookkkken.
The CEO spots do make for a great bathroom break...for the five hundred people still not owning a DVR.
Okay, today's b-speak special is looming. Brace yourselves.
“We really are in more of a menu-ed market now and clients want the flexibility to choose how they spend their dollars,” said GMR Marketing’s Ed Kiernan, a senior vice president and the agency’s golf lead. “It requires a lot more leniency from the property on spending and we have seen the tour respond in some areas.”
Menu-ed market and property leniency (I think) have something to do with those Villages and SPCA ads that popped up the last two years, but I'm not sure.
