The Biz: Masters may face sponsor-less future

By Published on .

Is the Masters golf tournament heading down a cart path that will eventually lead to a sponsor- and commercial-free event every year?

In the wake of dropping its sponsors, Augusta National Golf Club and Viacom's CBS have reached an agreement to split the $2 million production costs of next month's tournament. But some observers wonder if the caretakers of the Masters will exert even more control over the already-limited sponsorship and advertising.

"It will be interesting to see how the people at Augusta National and the Masters feel after this year's tournament is over," says Paul Swangard, managing director of the Warsaw Sports Marketing Center at the University of Oregon. "They need to figure out how the event derives economic value without sponsors. But if they think they can do it without corporate sponsors, I wouldn't be surprised if they were the ones to try."

The most famous golf tournament in the world was never a money-maker for CBS, which will televise the Masters for the 48th consecutive year on a one-year contract. Augusta National permitted only three event sponsors and just four minutes of advertising per hour during the four days of televised coverage. The sponsors were not allowed signage on the course and CBS has never been allowed to promote its shows during the coverage.

"This has always been a slightly better than break-even proposition for CBS," spokeswoman Leslie Anne Wade said. "We do it for the prestige."

"It was the anchor golf tournament for a very important programming series for CBS," said former CBS Sports President Neal Pilson. "It's unlikely the Masters will go without sponsors after this year. I just hope the issues get resolved because an event with the dignity and grandeur of the Masters will become a circus this year."

The circus hit town last September, when the Masters became engulfed in a controversy that is overshadowing this year's event and has become the predominant story on the PGA Tour. Martha Burk, chairwoman of the National Coalition of Women's Organizations, asked Augusta National chairman William "Hootie" Johnson to admit a female member to the all-male club before the April 7 tournament.

Johnson went public with his vehement opposition to the request, saying the club would not be held "at the point of a bayonet" in admitting its first female member. Johnson then took the extraordinary step of dropping IBM Corp., Coca-Cola Co. and Citigroup as sponsors, saying he did not want the marketers to become embroiled in the controversy.

IBM, Coke and Citigroup each paid between $5 million to $7 million in sponsorship fees, which normally cover the production costs of sporting events. In the event that a network assumes sole responsibility for production costs, it does so in the knowledge that it will make the money back-and then some-in advertising sales. But the Masters was always different.

keeping it clean

"Augusta National always wielded an incredible amount of influence over sponsorship and advertising because they wanted to keep the tournament clean," said a sports-marketing expert. "For years you could only show the back nine on live television, the ad time was extremely limited, and CBS capitulated because they wanted the tournament."

Representatives for the three marketers did not return calls. Glen Greenspan, spokesman for Augusta National, also did not return a call. Ms. Wade said no decisions have been made on whether IBM, Coke and Citigroup will return as sponsors for next year's tournament.

The debate between Johnson and Burk has escalated. Burk plans to protest on or near the club and has the support of the Rev. Jesse Jackson's Rainbow/PUSH Coalition. On the other side, a women's group in support of the all-male policy and a member of the Ku Klux Klan have also applied for permits to protest, threatening to turn the Masters from a tradition-laden event into a media sideshow.

With that backdrop, Swangard said, it isn't out of the realm of possibility to think the Masters could survive without sponsors and advertising. He suggested the Masters might look to licensing deals, such as an apparel line. "They've held back on the major assets and potential revenue streams they might have. After this year, they'll see what other triggers they can use."

Most Popular