Over the Green

Titleist may be sold
Acushnet Co., makers of the top rated and best selling Titleist Pro V1 golf balls and FootJoy shoes, could be part of a corporate shedding by parent Fortune Brands (NYSE:FO). Rumors have both Callaway Golf (NYSE:ELY) and Nike (NYSE:NKE) as potential purchasers of Acushnet, the world’s largest golf equipment company.

The equipment business has not been doing well in recent years with insiders citing a shrinking golf base in the U.S. and a collapse of formerly high growth markets in Asia. Acushnet reported third quarter operating income down 43 percent ($5.5 million) for the three months ended Sept. 30 and down from $9.7 million for the third quarter 2009. Sales were $265 million down $13 million quarter over quarter. Compared to last year Acushnet sales were up about 2 percent to over $1 billion had operating income of $115 for the nine months, an 85 percent increase over 2009.

So at least Acushnet is making a profit. Callaway Golf, contrasting to Acushnet’s core ball business (over 50 percent market share) has not seen their basic business of metal woods expand in the face of dominant competition such as adidas’ (PINK:ADDDF) TaylorMade Golf. Callaway had more than a 10 percent loss in the most recent quarter and lost 1.6 percent in 2009 so unless they find affordable financing they probably cannot afford a deal for Acushnet.

Nike’s golf business is built around Tiger Woods and particularly in the past year has not done well as they would like especially with the previously top ranked fan-favorite (see next item) golfer as spokesman. Nike most likely has the money and it would be a way to pair the competitive environment at the top of the golf equipment market from four players to three.

Tiger shut out
Tiger Woods, golf’s fallen idol, according to a story on Bloomberg.com still retains his attractiveness to tournament goers, at least in Australia. Playing to a fourth place finish in this past weekend’s Australian Masters, Woods the defending champion still drew large crowds whether watching him warm up or his amazing 6-under par finish in the last round.

It was almost one year ago; two weeks after Woods triumph at the 2009 Australian Masters and last tournament victory, his troubles came to light with the early morning car crash at the end of his suburban Orlando driveway. The victory last year was not without controversy though, since he received a reported $3 million appearance fee which was justified as having helped generate $34 million for the local Victorian economy. Total tournament purse was $1.5 million and Woods received the same appearance fee this year.

With this loss Woods also missed his last chance to win a sanctioned event on one of the world professional tours in 2010.

The Great White Shark & Lorena vs. The Golden Bear & Annika
With the 2016 Olympics being held in South America and for the first time in a century including golf, host city Rio de Janeiro needs a golf course worthy of the competition. Stepping up to win the bid to design the new Olympic course are a couple of interesting couples.

Jack Nicklaus has teamed with Annika Sorenstam while Greg Norman and Lorena Ochoa will co-design if they are chosen. No word if Arnold Pallmer will pair up with someone like Laura Davies or maybe Tom Fazio will look to Natalie Gulbis as a partner.

The siege of Troy
Nobody has ever said professional-level golf was easy as PGA Tour rookie Troy Merritt well knows. Trying to keep his Tour card for 2011 Merritt started the final week of the season at 121 on the money list seemingly a comfortable distance above the magic 125 spot to retain full playing privileges.

Sunday of the Children’s Miracle Network Classic at Walt Disney World Merritt lost ground in the marathon which becomes a sprint at the end of the year, but did manage to finish right on the 125 spot. He also went back home to Arizona with a million dollars from his one hole playoff win of the Kodak Challenge over Rickie Fowler and Aaron Baddeley.

Well, it’s official. Tiger Woods is no longer leader in points, no longer ranked as the world’s number one golfer. Lee Westwood is atop the listing after Woods’ fall from grace and the loss of his competitive game.

To add some perspective to this well reported event, Woods current reign lasted 281 consecutive weeks but since turning professional the number one spot has been his one week short of 12 years or to do the math, 623 weeks. Dominating would be the best way to describe it.

Englishman Westwood, since Woods’ last victory in the Australian Masters one year ago has also won once, the Houston Open for his second PGA Tour title. Not exactly dominating.

The problem is the rankings, which by definition take into account past performance, and with Woods having such a large lead (until his car wreck) it took the other very good world-class players this long to overtake him. But that aside the problem is the rankings themselves.

First of all the guy who is playing the best right now is the best player in the world, not because he won X number of times in the past but because he is playing the best today. Think of the way the NFL determines who is the best with the Super Bowl.

Our system does not name the best player just the one who has the most points accumulated based on some arcane computerized formula with adjustments for things like “strength of field.” However remember the real point of this rankings exercise; it is not about who is the world’s best player but all about the marketing of golf in general and the PGA Tour in particular. One shouldn’t get too excited about which golfer is at the top of the pyramid. It will change and all the media attention is a good thing.

Let’s see, for the first time Tiger Woods will go a full season without a tournament win, rules officials at every level seem to be in the news – most of it not good, Dustin Johnson showed he has game by winning at the BMW Championship after the U.S. Open and PGA and the USGA after making repeated statements of the inadvisability of two sets of rules-one for pros and a different one for the rest of us-has done just that by the decision to disallow box grooves and then phase in implementation over more than a decade. Makes one wish for simpler times.

The latest revelation is the USGA has been testing shorter flying golf balls. Dick Rugge, Technical Director of the Association, says this has been an ongoing program for five years which naturally raises everybody’s hackles as in why the secrecy. Rugge explains it by saying the program and most especially the results have not been publicized since they don’t want to affect future testers with past results.

This naturally begs the question, if you were asked to test a golf ball by the USGA, wouldn’t you think one if not the most important result they were looking for was distance?

In any event the issue of two sets of rules is out in plain set still and needs to be addressed in some other manner than the USGA is doing presently, such as not being so worried about secrecy or tradition and more about the health of the game. One can understand both points of view by the Far Hills administrators however these are not the most pressing problem faced by the game or the business of golf.

Golf has always been and presumably always will be changing. New materials, manufacturing techniques, agronomic improvements and better player conditioning each play a part and if you read anything of golf history always have. To focus solely on equipment (drivers, grooves, balls) which the USGA has done particularly behind closed doors is both short sighted and bad for the game.

Frank Thomas, former USGA Technical Director and current industry consultant, wrote recently:

It is true that the USGA is testing a golf ball, which has reduced flight properties — about 20 to 25 yards less distance than the present ball. The distance the elite players hit the ball has been a concern since 1890. The fear is that the increase in distance will continue and that something needs to be done. It is this mindset that has initiated numerous and very questionable rules changes, which have had no effect on the distance balls go.

Having said this; the good news is that the USGA is conducting tests which I am sure will include the average gofer not just the elite (.001%) of the golfing population, and that the effect on the game as a whole will be very carefully considered. This is a sizable study which if done correctly will take a number of years to complete. The bad news is that the tests are being done as much behind closed doors as possible. This is not the way to govern the game.
If we really have a problem with the distance the ball goes we need to clearly define this problem. We then need to explain to the golfing public – indirectly the USGA’s constituents – that this problem needs to be resolved to protect the integrity of our game.

Elin Woods and Tiger Woods are finally divorced roughly nine months after Tiger’s extramarital escapades with prostitutes and other women came to light. It’s the end of a life changing tragedy for the Woods family.

As one woman put it after hearing the final papers had been filed in a Panama City, Fla. court, “Good. She dropped him like a bad habit,” which of course he was.

It remains to be seen if he continues his destructive behavior.

Another tragedy has already begun, two more children being raised without their father living with them.

In light of this, another point seems inconsequential but it would be best if Tiger finds the character to return to his former dominate position as the best player in the world. Golf needs him.

Has anyone noticed? The past couple of weeks in the world of golf have been very unusual if not down right weird.

An Oklahoma amateur shoots a score of 56 in a local member-guest tournament, an Alabama teen records a 57 in his state’s Boys Junior Championship plus of course Stuart Appleby humbles the field with a 59 at the Greenbrier Classic for a classic come-from-behind win. Kind of makes David Frost’s 61 yesterday up in Minnesota to take his first Champions Tour event almost irrelevant…except presumably to Frost.

In the race for number one ranking in the world Tiger Woods played the four days at Firestone like his was trying to give away his top spot to Phil Mickelson and Mickelson played like he didn’t want to take it. If it’s of any significance or what may be a preview of the coming PGA Championship, Tiger won the two man battle of the fourth round Sunday with a 77 to Lefty’s 78. One could compare these two efforts to winner Hunter Mahan’s 64, but that would be labeled cruel and unusual punishment.

And by the way, Woods personal problems have not fallen out of the media but then again gawkers drive slowly past a car wreck too.

Not to be out done in the unusual department, the LPGA’s triple A league Future’s Tour saw a rules official disqualify Sarah Brown during her round from the International at Concord for carrying a nonconforming Ping wedge, which the world now knows was conforming to the Rules of Golf. Tour management tried to compensate Brown with the laughable sum of $2,000 which Brown refused. However Brown and the Tour did eventually reach an undisclosed settlement. No one is blaming Ping or Brown and everyone is beating up on the Future’s Tour and the two officials who acted with world class stupidity. The USGA so far has escaped public outrage as the cause of this fiasco due to the “groove rule” they instituted last year.

And then as if to provide icing on the cake, Acushnet is suing TaylorMade Golf for trumpeting TMaG’s signing of Camilo Villegas. The young superstar is presently under contract with Acushnet’s Footjoy and Titleist brands and used in advertising for those products. TMaG inked a deal with Villegas starting in the 2011 season and put out a press release telling the world.

This is not normally done as it does lessen the endorsement value of any golfer to the company he is currently accepting a paycheck from and who knows when the shoe may be on the other foot.

Acushnet is asking for an injunction to stop TMaG from any further mention of Villegas until the end of the year and will ask for money to compensate for the loss of his endorsement for five months. Of course Villegas probably isn’t too happy either since he’s included in the law suit.

It’s hard to imagine what PGA Championship week will bring.

A story on the web site “The Street” noted research concerning sales of Tiger Woods PGA Tour 11 video game as falling far short of last years sales one month after its introduction. In fact the figures show a 68 percent decline for the Electronic Arts (NASDQ: ERTS) game compared to 2009 June sales when the Woods game was one of the hottest and most sought after releases.
EA says the poor sales are due to the economic slowdown and that Woods has only returned to the links this past spring plus he has not been a contender, much less a winner, since coming back.

EA did not fire Woods after the revelations of numerous extramarital affairs beginning in November 2009 as did other corporations including AT&T, Gillette, Gatorade and Accenture. Woods’ largest sponsor before and after his self-imposed hiatus from competition remains Nike who pays him an estimated $30 million per year and have built their golf marketing effort around him and the TW brand.

Nike chairman Phil Knight has made comments to the effect not only will Nike stand by Woods through the scandal but overall it is of little consequence to his career. Industry sources have guessed that prior to the onset of his personal problems Woods had an annual income of $100 million from endorsements and prize money.

If indeed Woods does not return at least part of the way back to his former status as paragon and star product endorser even those corporations that have continued their relationship will have to reassess all that money they pay him.

The well-chronicled fall from grace of the world’s number one player has had a far reaching impact on Tiger Woods, his family and golf in general. However, in spite of reports of a three quarter of a billion (yes, that’s a B) divorce settlement pending Woods is not going to have to peddle his used Nike clubs on eBay to make ends meet. He still has plenty of off course income from Nike, Electronic Arts and others who evidently were able to hold their collective corporate noses even after being fired from endorsement contracts with Gatorade, AT&T and Accenture.

An article on Forbes.com by Kurt Badenhausen puts numbers to the wages of sin. According to the story Woods lost about $30 million in endorsement deals but retains the estimated $30 million Nike pays him.

Of significance though is the state of Woods course design business and the troubles there are not linked to Woods’ actions as much as the worldwide economic slowdown and real estate collapse.

The high profile Al Ruwaya Golf Course project in Dubai for which Badenhausen reports Woods received $20 million plus a slice of real estate sales, has stopped construction. The Cliffs Communities in North Carolina promotes a Woods design that is has now been delayed for the second time and lack of financing casts doubts it will ever be completed. Finally the Punta Brava development in Mexico is having problems with permitting and an opening for a to-be-built golf course is in the far distant future.

He presumably will also get back to winning at some point so those on course earnings will help.

Jack Nicklaus, the best player ever, golf icon, etc. was quoted this week with the comment Ryder Cup captain Corey Pavin needs a “brain scan” should Tiger Woods not be one of the top eight in the points qualifying list for the US team and Pavin does not make him a captain’s choice. Could be, since Woods has the second best all time major record but as golf cognoscenti know he hasn’t performed very well in Ryder Cup competition with a 10-13-2 overall record for five Ryder Cups.

Of course the current leader of the points list, Phil Mickelson, also has a losing record at 10-14-6.

If the Ryder Cup team were chosen as of the May 24 point standings here are the Ryder Cup records of the next nine players, seven of whom would all automatically qualify with Pavin being allowed four picks.

Anthony Kim 2-1-1
Jim Furyk 8-13-3
Lucas Glover-Ryder Cup rookie
Hunter Mahan 2-0-3
Steve Stricker 0-2-1
Dustin Johnson- Ryder Cup rookie
Stewart Cink 4-7-4
Ben Crane- Ryder Cup rookie
Matt Kuchar- Ryder Cup rookie

Woods is number 11 and Nick Watney (Ryder Cup rookie) rounds out the top 12.

Some of my fellow media members are screaming for Pavin to consult with 2008 winning captain Paul Azinger to gain insight how the 2008 winning captain created the team that took the Euros at Valhalla. To date Pavin has not had that conversation, which on the face of it seems to be poor judgment but maybe he read Zinger’s book and doesn’t need a meeting.

That could rate as the worst thinking since…well it would be right along side not making Woods one of his four picks.

And in the for-what-its-worth department Nicklaus’ Ryder Cup record was 17-8-3, Palmer’s 22-8-2 and Watson’s 10-4-1.

Its amazing how little media attention has been devoted recently on Tiger Woods and his problems. Oh, there’s been speculation about a purported impending divorce and how soon everybody’s latest hero Phil Mickelson can overtake Woods as the world’s number one ranked golfer.

There’s been even more pontificating over the departure of Hank Haney as Tiger’s swing coach. (Two germane points: 1 – don’t forget Haney fired Woods and 2 – all the top swing coaches know what they are doing, it comes down to if player and coach can build a deep level of communication)

Woods return at the Masters and then withdrawal from the Players Championship with a weeks/months old neck injury, after saying just a few days before he had no physical problems, illustrates he has very long way to go before he understands his responsibility as a world class golfer/role model/pitchman.

The intemperate if not foul language still in evidence after his vow to change, most likely is a sign of something much deeper that is still amiss.

Watching the PGA Tour event this past weekend honoring Byron Nelson who is remembered as one of golf’s great gentleman brings to mind other dominant players of living memory such as Palmer, Nicklaus, Watson none of whom by any stretch of the imagination have gotten themselves in the mess Woods has made.

All of them suffered through the loss of a father and mother and at least in one case had heart wrenching family problems but each still maintained the civility and integrity which arises from intelligence and character.

Golf as a game and golf as a business needs a healthy, happy and functioning Tiger Woods. Lets hope he can pull himself together and start functioning as we all want him to as a man, champion and hero.

Is there any doubt Tiger Woods, by his behavior, has placed his family life in jeopardy? Of course he has but also his dishonest philandering has put in question his position at the top of the heap in the world of tournaments and golf business.

The latest flap over the resignation by Hank Haney as Woods’ coach only served to focus attention on the phoniness of Woods life and how, if there is any chance his image may be compromised, he is not above telling untruths if not outright lies.

The most recent example: At the beginning of the Players Championship week he was asked about how he was physically and the answer was no problems. At the end of the week he WDs with a neck injury which he says has been bothering him at least for weeks. Another instance of many, going back months if not years and it is too bad.

Golf is a game of integrity. This combined with the promise of a young golf god of mixed ethnicity who could hit all the shots, win with consistency and inspire young and old alike was a marketing dream come true. The image Woods cultivated made him hundreds of millions of dollars from both the marketers of golf and those who use golf to market their products.

Companies such as Nike who did not fire him as a pitchman-endorser decided cynically his value would return after the public, with its’ famous short attention span and only slightly longer memory, had forgiven or more likely forgotten.

Woods lack of integrity is as much on display as his sloppy and inept golf swing has been.

The end result of Woods sexual escapades looks like it might be a broken family as well as an abdication of his role model role. He had been looked up to, envied and emulated. Woods promised when he deigned to make a public appearance he was committed to a new Tiger. Now it seems to be more of the old Tiger.

Too bad. Golf needs a headliner of integrity and honesty. It doesn’t appear Woods has the character to be the one.