Nike announced on Wednesday that it was exiting the golf equipment business.
The decision came after years of declining sales of golf clubs, balls, and bags. Last year, sales within Nike’s golf division fell 8% to $706 million. Why was the company’s golf business in decline? This Google Trends chart, highlighted on Twitter by Tim Crow, the CEO of the London- and New York-based sponsorship agency Synergy, gives some indication.
As the chart suggests, interest in golf has been on the wane for some time — but that didn’t keep interest in Tiger Woods from maintaining a fairly steady level before a recent slump.
Interest in Woods blew up in 2009 when the golfer’s many affairs were revealed by several women.
Nike was one of the few sponsors to stick by Woods at the time, and he has essentially been the driver of the company’s entire golf business.
Nike created its first line of golf apparel in 1984, but it only really began booming when it signed a 20-year-old Woods in 1996 and invested heavily in major advertising campaigns placing him at the center.
A study carried out by the Tepper School of Business at Carnegie Mellon University in 2009, reported by CBS News, found that in a decade of sponsoring Woods, Nike’s golf ball unit alone added $91 million in additional revenue and $60 million in extra profit. When Woods endorsed Nike, 4.5 million new customers followed, according to the study.
But during Woods’ monthslong hiatus from golf after the 2009 scandal, the entire golf ball category lost $10.2 million in revenue, the study said. Woods’ period of leave also saw ticket and sponsorship sales slump 15 to 20%.
Read more at BusinessInsider.com
