Why are purses increasing?

[Nachosgrande]

Unfortunately, golf is dying. Less people play and less people watch every year. So on an economic level, can someone explain to me why purses continue to go up?

[thug the bunny]

Good question. Looking just at the thread title, I was about to reply sarcastically 'but I thought golf was dying'. If golf participation is dying, then tournament viewership should also be declining (I never ever watched golf until I started playing), which means sponsorship should also decline. Makes no sense. Let's wait for the explanations to roll in.

 

My thoughts are the 'golf is dying' numbers are contrived. By whom? Hmmmmm.....

[LittleLeftToRight]

The guy who hooks up the sponsors has really good blow.

 

That would be my guess.

[thug the bunny]

LLTR, look at our avatars. Interesting. Contrasting yet similar. Warm and glowing vs. cold and grey, like my soul. Just kidding. Now back to the thread...

[McCann1]

I don't think anybody here can give you an explanation unless they are involved in the Tour. Everyone else is just speculating

[Dave230]

I think golf is more sponsor friendly than ever, it will have videos on social media, branding the whole way through tournaments. Having your name on a tournament does make a difference, there are several companies/products that I only know because their name is on a tournament.

 

Also the length of golf, let's say Spieth goes wire-to-wire, he's probably going to show 15-16 hours worth of Under Armour clothing. They used to say 'how does Norman get paid so much if he's not winning majors?' and the answer was 'he's in contention therefore he's on TV, and that's all that matters'.

[Ristlager]

The biggest reason I can see is the globalization of golf. I don't think the PGA tour had that many viewers outside of USA in the 90ths and early 2000 (?), but now they are attracting viewers from from the whole world. And even though less people are watching in America, more people are watching from the rest of the world to make up for the decline. Which leads to more revenue and therefore more money for the players. And economic inflation yields more money.

 

And of course the Tiger effect ;)

[rorygilmore9]

Golf isn't dying.

[wcbjr]

The biggest reason I can see is the globalization of golf. I don't think the PGA tour had that many viewers outside of USA in the 90ths and early 2000 (?), but now they are attracting viewers from from the whole world. And even though less people are watching in America, more people are watching from the rest of the world to make up for the decline. Which leads to more revenue and therefore more money for the players. And economic inflation yields more money.

 

And of course the Tiger effect ;)

 

Pretty much this.

[JDCON]

In short, the PGA Tour is able to get more money for a sponsorship and merchandising. There's a lot more that goes into it than tv viewership. More money coming from a tournament sponsor and merchandise means more money for purses.

 

Also, golf is dying? ... okay?

[Vindog]

Pretty easy anwser actually One only has to research the current deal that was struck between a few years ago by Finchem & Co with the network coverage outlets. In those deals it was reported that purses were still set to increase on a yearly basis, albeit by a smaller margin than in the Tiger Prime era. This was all made public when it happened and really isn't a secret

 

The USGA got a crapload of money by Fox for it's coverage, The PGAoA has always been a high purse Major.

 

So whether participation or viewership is dying or not is irrelevant at the moment. The deal has been made.

[baaron008]

People that watch golf are a prime target market that spend lots of money. Their eyeballs are worth more than other viewers, so the absolute number of viewers isn't necessarily germane to purse sizes.

[moonshine]

I don't think anybody here can give you an explanation unless they are involved in the Tour. Everyone else is just speculating

You are kidding right? Basic business model....make more money and find accounting transaction on books indicating you are writing it off. Corporate tax structure in the country is idiotic...

[iBanesto]

I believe for the European Tour, there has been great investment into the tour from the Middle East, Asia especially China and Turkey over the last decade.

 

Globalisation has helped increase purses on the ET.

[baaron008]

I don't think anybody here can give you an explanation unless they are involved in the Tour. Everyone else is just speculating

You are kidding right? Basic business model....make more money and find accounting transaction on books indicating you are writing it off. Corporate tax structure in the country is idiotic...

 

This too. Most of the tournements are run by 501©(3) offshoots of Corporations as charities and the purses are written off, even though they are "really" advertising dollars.

[BlackDiamondPar5]

Golf is dying? ?

[Bad9]

Pretty easy anwser actually One only has to research the current deal that was struck between a few years ago by Finchem & Co with the network coverage outlets. In those deals it was reported that purses were still set to increase on a yearly basis, albeit by a smaller margin than in the Tiger Prime era. This was all made public when it happened and really isn't a secret

 

The USGA got a crapload of money by Fox for it's coverage, The PGAoA has always been a high purse Major.

 

So whether participation or viewership is dying or not is irrelevant at the moment. The deal has been made.

 

Yup. It will be interesting to see what the next contract looks like if the declining viewing and participation numbers continue(if these numbers are declining as reported in various threads here). If the decline is real it may not affect the majors much but the regular tour stops could be in for a major reduction.

[mosesgolf]

Golf is booming in Asia and so is viewership. The PGA Tour is now a global entity and while # of rounds may be down in the US, it doesn't mean it's down in other parts of the world. Big corporations are flush with cash. They spend a lot to get to their target audience and golf's target audience has money.

[BMC]

I just hope golf is dying this Saturday morning at 8:10 for a speedy round.

[bladehunter]

Because The bababootieers are allowed to buy tickets. Ticket sales are up , so sponsored are buying in. Sponsors are being asked for more money to increase purses.

 

 

If you believe the above I have some land for sale. . Lol

[hdr_ric]

The PGA tour's success/failure and golf "participation" rates are not really correlated. OP started this thread with a false premise.

[knock it close]

The PGA tour's success/failure and golf "participation" rates are not really correlated. OP started this thread with a false premise.

came here to say this.

[bigmoneyp]

I dont understand when ppl say golf is dying. If I don't make my tee time for the weekend on like Wednesday, every course around me is booked solid. Any weekday after 3pm every course is jammed with leagues. If I drive to my local golf shop on a sunny day to check out equipment I have to park across the street at the range because the shop is so busy. I could keep going but I think you get the point...

[sandy]

I sure don't understand why purses would still be increasing. Tiger who drove interest and purses from the late 1990s hasn't been relevant in almost a decade. While there are a large number of excellent golfers they are very boring, lifeless compared to Tiger. Other than Day and McIlroy the interviews and press conferences are so boring. Jordan's act comes off as contrived and phony and Phil at this point loves to hear himself talk forever. Viewership is off for most tournaments except the Masters. 2 shots and a commercial and the same boring (CBS, NBC) announcers or incompetent announcers (Fox) doesn't help. I live in a couple of the golf hotbeds over the years with tons of courses. Many of those have gone under and many public courses are being closed and sold to real estate developers. Not enough rounds to pay for upkeep and cities looking to get out of the continued drain on budgets maintaining and running courses. I know personally I rarely watch any golf live...it is too much time wasted. Even the golf I tape I wind up fast forwarding it to golfers of interest or to bypass commercials. I might spend 30 minutes watching a 3 hour telecast.

 

Personally As far as playing I had a three some for years that got together every two weeks at a few favorite courses, but the amount of time a round takes these days is mind boggling.. By the way we all went to college on golf scholarships, so not a group of 90+ shooters adding to the 6 hour rounds. All the courses but one country club we used to play are all gone replaced by condos or water parks etc. We now might play 6 times a year where we used to play more than 24-30 times a year.

 

We also used to have a great selection of 9 driving ranges to choose from that all had grass tees with well maintained target greens etc. All but one gone to developers..just too much real estate not making money with dwindling customer base. We now have 1 left that is considering getting rid of grass tees and grass chipping and putting areas..going to artificial surfaces..

 

Just my opinion and personal experiences on golfs apparent waning and loss of interest in the two cities I live in plus a few more vacation spots.

[Vespar]

Unfortunately, golf is dying. Less people play and less people watch every year. So on an economic level, can someone explain to me why purses continue to go up?

 

 

simple, the purses have gone up due to sponsorship...btw many of the sponsorships cater to a much older audience, like insurance, Viagra, health care, luxury automobiles, brokerages and business software.

 

Here is another analogy I love watching hockey, especially the stanley cup finals. I have not skated in decades, no longer own a hockey stick or skates and have no desire to go skating....may people are like this concerning watching golf

[bscinstnct]

People that watch golf are a prime target market that spend lots of money. Their eyeballs are worth more than other viewers, so the absolute number of viewers isn't necessarily germane to purse sizes.

 

 

[RobS14526]

Pretty easy anwser actually One only has to research the current deal that was struck between a few years ago by Finchem & Co with the network coverage outlets. In those deals it was reported that purses were still set to increase on a yearly basis, albeit by a smaller margin than in the Tiger Prime era. This was all made public when it happened and really isn't a secret

 

The USGA got a crapload of money by Fox for it's coverage, The PGAoA has always been a high purse Major.

 

So whether participation or viewership is dying or not is irrelevant at the moment. The deal has been made.

 

Yup. It will be interesting to see what the next contract looks like if the declining viewing and participation numbers continue(if these numbers are declining as reported in various threads here). If the decline is real it may not affect the majors much but the regular tour stops could be in for a major reduction.

There were stories last fall that the tour may exercise an opt out of its current deals with CBS and NBC after the 2018 season and open it back up to the highest bidder. So they appear to believe they can increase revenues on the next deal, much less maintain the current deal.

[thug the bunny]

The PGA tour's success/failure and golf "participation" rates are not really correlated. OP started this thread with a false premise.

 

He did not establish a premise. He asked a question.

 

So you are saying that non-golfers watch golf on tv? I personally don't know of any..

[Bad9]

The PGA tour's success/failure and golf "participation" rates are not really correlated. OP started this thread with a false premise.

 

He did not establish a premise. He asked a question.

 

So you are saying that non-golfers watch golf on tv? I personally don't know of any..

 

My wife is a non golfer and will watch the majors if the "names" are in it. That said she is probably the exception. I know many golfers who don't watch golf on tv.

[Hattie Pants]

I don't think anybody here can give you an explanation unless they are involved in the Tour. Everyone else is just speculating

You are kidding right? Basic business model....make more money and find accounting transaction on books indicating you are writing it off. Corporate tax structure in the country is idiotic...

 

This too. Most of the tournements are run by 501©(3) offshoots of Corporations as charities and the purses are written off, even though they are "really" advertising dollars.

 

 

Sounds pretty smart to me