Nike executives were grinning ear-to-ear yesterday as they basked in the glow of their endorsers’ 1-2 finish at The Masters, sure that their five-year plan to dominate the world – of golf – was working out exactly as planned.
Consider that the Tiger Woods-David Duval battle for first place had the ubiquitous “Swoosh” of the $9 billion sporting goods behemoth plastered across TV screens all weekend and on the front page of every major newspaper in the country yesterday.
While the superior performance of Woods has powered Nike Golf from zero to annual sales of $200 million to $300 million – while affording the golf whiz $54 million a year in endorsement cash – it was the first major tournament for Duval flying the Nike flag.
The 1-2 Woods-Duval marketing punch, which company insiders are comparing to the Michael Jordan-Scottie Pippen marketing powerhouse Nike used to secure its grip on basketball, is being primed to win Nike its own golfing grand slam – that is, domination in golf shoes, apparel, balls and clubs.
This is how those Nike insiders view the plan.
In 1996, when Woods turned pro, Nike put the plan into action by signing a five-year, $40 million endorsement deal with Woods. The phenom would wear Nike apparel and shoes and help put Nike on the golf map. Today, despite some missteps, the Woods sub-brand, with its $90 golf shirts, is among the best sellers in Pro Shops.
Nike next teed up the ball category. Woods switched last summer from Titleist to the Nike Tour Accuracy solid-core ball and the country changed with him. Nike went from 2 percent market share to 10 percent of the U.S. ball market, an $80 million revenue pick-up – and Nike ups its deal with Woods to $20 million a year from $8 million a year.
The clubs sector was next. With Woods under contract with Titleist, Nike successfully wooed Duval. Beginning last January, Duval started using Nike balls, clothes, shoes and irons. He will endorse a line lower-priced than Woods’.
Those irons will hit stores next year. A second sub-brand, for Duval, is not out of the question.
With Woods just 25 years old and Duval 29, Nike believes its dynamic duo is now in place for a two decade run. At least.
Whether the golf division, no matter how successful, can affect a $9 billion company, though, remains to be seen.