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Home LPGA is off to a strong start in 2012


Less than two weeks into 2012 and there are some signs that golf is on an uptick. While everyone waits on the economy to show some clues its finally on the mend, one organization is already foreshadowing it will be a good year. The challenges ever present in the current, be it lingering, economy create additional pressures on any business and indirectly tests the strength of a brand and its products. Some years it’s easier to overcome a poor performance when economic tailwinds are pushing from behind. However, when it’s the opposite then mistakes prove quite costly. Therefore, many business leaders remain interested yet reluctant to make financial commitments until supporting evidence bolsters a case that action becomes prudent.

Recently, the PGA TOUR Policy Board rewarded Tim Finchem with a contract extension.  It was certainly warranted for many reasons. Truth be told, there are plenty of companies and organizations that would like to have someone that has overseen a period of tremendous growth since taking charge. In the last few years, the TOUR has been challenged on a variety of fronts and appears to have weathered the storms better than anyone expected. The brand remains popular and appears poised for another strong year and it has four more years to develop a succession plan for Finchem’s eventual retirement. Not every business is the PGA TOUR, however, and it doesn’t properly reflect the remainder of the golf industry.

Its fair to say there is, and has been, plenty of people pulling for the LPGA to do well. However, there haven’t been as many that are willing to write a check to help with its cause. Actions often speak louder than words and when it comes to the topic of money, it’s been a difference maker lately not only for the LPGA but many businesses it seems, the PGA TOUR being the exception to the rule.

Mike Whan, LPGA Commissioner, is being applauded for his efforts to help resurrect the LPGA tournament schedule. Among some of the highlights in 2012 are five new events, including four in North America. A new Japanese TV rights partner (WOWOW) and more than a 15% increase in total purses ($47 million in 2012). It isn’t difficult to say that the LPGA is regaining its health. A year ago many would have argued it was on life support. It isn’t in the same stratosphere as Tim Tebow (is there anything that currently is?) but more tournaments; more corporate partners should lead to more fans. “While many fans and media may focus on our new tournament additions, I think it’s just as important to understand the core elements that have created this upward momentum for the LPGA,” Whan said. “The commitment and support of our existing tournament sponsors, the dramatic improvement in our television production and viewership, and the significant growth in marketing partners is really the foundation for our schedule growth.

“I’m not sure the economy was much different in 2011 than in 2010. Every company is critically analyzing its market spend. But we are excited,” Whan said. “I’ve told my staff, the real work begins after a deal has been made. There are really only two business out there, former and stronger ones,” he continued. “You have to learn to be smarter and work with tighter margins and live a little skinnier. That doesn’t make you desperate, it makes you like every other business right now.”

Whan admitted in his first year on the job, he spent a majority of his time focused on the LPGA customer. “I spent one day a week talking to new customers and the other four on existing business,” he said, “and I think that lead to more business for us. The days of customers saying they like golf and cut you a check are gone. We have to deliver growth to CMOs and CEOs and when we do that it takes care of itself,” said Whan. While 2011 didn’t delivered many pleasant surprises around the world, Whan and company saw that less meant more for the LPGA. Despite only 23 official money tournaments last year, TV viewership of North American tournaments increased 38%. “Some people might have predicted some of this (improvement) but not a spike in TV rating by nearly 40%,” said Whan.

Yani Tseng enjoyed an incredible year that delivered a remarkable seven wins, two-second place finishes and a third in the 22 events she played in 2011. Lexi Thompson at 16 years old is already a player many fans can’t wait to see more of. In 2011, she won the Navistar LPGA Classic by five stroke and followed it up in December when she made history as the youngest winner on both the LPGA and Ladies European Tours when she captured the Dubai Ladies Masters. “I don’t think Lexi, frankly, had much to do with some of the growth we are having with our tournaments increasing and corporate sponsorship,” said Whan. “She is a sign for 2013 and beyond. I think our viewership increase and growth in events and sponsors is more about what I call our ‘young guns.’ We have a lot of really good stories. Can Yani Tseng separate herself from the others? Or will Suzann Pettersen have something to say about that. Michelle Wie is out of Stanford now and her game always generates plenty of interest,” explained Whan.

An area that was once considered a liability from a US stand point, was the Asian influence of LPGA players. It now appears to be an asset, especially in the business environment. “There isn’t a Fortune 500 company that doesn’t deal with globalization in their business. When I sit down with a CEO and I ask them to spend five minutes explaining their business, they always talk about globalization and Asia in particular. When I have my five minutes to talk about the LPGA, I share that we are also about globalization. We were the first in Asia golf. We made some mistakes, which happens when you’re first,” he explained. “When change happens fast, especially in sports it isn’t often handled well. But from a corporate sponsorship, it’s a global business today.”

Many golf businesses from equipment companies to course architects are touting the Asian landscape as room for growth. The LPGA is clearly a step ahead in part since several players hail from Korea, Japan and other parts including Taiwan where Tseng is originally from. “If your a fan of the Olympics, its a global game. Once you know the story of someone, say the bobsled team from Germany, you cheer for them. Golf isn’t any different. Once you know Yani, Annika, Rory McIlroy or K.J. Choi you follow and cheer for them,” said Whan. His product is a representation of the US, Europe, Asia and others parts of the world and it can pay dividends in the business world. “Take a company like HSBC that is based in the UK but you have a tournament in Singapore or six other countries,” Whan offered as an example. “This isn’t a formula, there are fans around the world and companies that are looking to connect with them for business. We offer a good rate of return to companies like R.R. Donnelley, Navistar and even properties like Kingsmill. They can have events beyond their headquarters. We’re unique.”

Golf and growth haven’t exactly been on the friendliest of terms lately. The LPGA has been swimming upstream, which doesn’t make it unique in these uncertain economic times. But delivering results despite the challenges certainly does.