Does Nike Get Its Money's Worth From Tiger Woods?

The assumption that Nike Inc. (NYSE: NKE) must have made when it extended its contract with Tiger Woods two years ago was that the great golfer would remain a great golfer in the future. Woods did win five PGA tour events that year. Since then, nothing.

Presumably endorsers have among their most important expectations that a champion will remain a champion. Champions get more TV time. In golf, this means a spot in the final few groups of players on Sunday, the ones the network cameras follow. In the most recent tournament he played in, the Memorial, Woods was in the first group on Sunday, by himself, because he had the worst three-day score as he started the last round — at 8:10 in the morning. Most of the media members who covered the tournament were probably still in bed, or perhaps at breakfast.

The value of Woods, for the time being, is that he is still the most recognizable figure in golf, and he should be for another year or two, unless he finishes in last place over and over again. Woods is close to breaking Sam Snead’s all-time career PGA victories. Snead had 82. Woods has 79. At the pace of wins Woods posted in 2013, he should have bested Snead last year. Pessimists believe he will never pass Snead at all, which takes away a great deal of Woods’s appeal. A small group of experts still believe that Woods can reach Jack Nicklaus’s record of 18 majors. But the number of people in that group shrinks as each major passes.

Some group of executives at Nike must already regret the Woods sponsorship. Rolex is his only other recognizable sponsor, which says a great deal about what major consumer-based companies think about Woods’s prospects, or his public troubles. Nike hung in for all of that period, in the hopes of something better.

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