Tiger Woods is the only athlete who will come close to earning $100 million in endorsements this year. But the actions of two of the companies he had deals with questions whether Woods is worth the price companies pay.
Last week, American Express signed a deal to become the official card of the PGA of America and the USGA--and in the process decided to end its deal with Woods after a 10-year relationship with the brand. This after Buick decided earlier in the year to stick Woods on OnStar instead of focusing on its cars--after Woods apparently failed to lower the average age of the Buick driver.
He wins more than any athlete (other than perhaps Roger Federer). He’s a fan favorite. And he’s actually pretty good in the commercials he stars in. So the question is, what is wrong with Tiger?
First, we must provide the context. Michael Jordan is seen as the greatest endorser of all time. He did wonders for Nike . But let’s not forget that he didn’t increase the market share of Gatorade and he didn’t do tremendous wonders for Rayovac or Ballpark Franks.
Tiger’s deal with Buick never made sense. People didn’t think that given the choice, he would drive a Buick so the deal never made sense from the start. It also didn’t make sense because Tiger’s good, but he’s not going to drive a $50,000 purchasing decision.
While Tiger is doing plenty for Nike golf, Upper Deck and Electronic Arts , it’s hard to say he could do much for American Express either. American Express is seen as the elite credit card. People feel special when they spend with AMEX in a way they don’t when they have a Visa or a MasterCard. The fact that Tiger Woods had an AMEX made sense, but did it drive card increases? I’d doubt it.
So the bottom line is: there are limits to endorsements. Tiger is golden for the companies I mentioned above (Nike, Upper Deck, EA), but for everything else (including Accenture , Tag Heuer and yes, American Express) he’s a non-factor. I think it just took American Express 10 years to figure that out.
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