Tiger Woods and Nike: A $500 million empire spanning 27 years

On Saturday, December 30, Tiger Woods turned 48 years old. A day later, on Sunday, December 31, a historic relationship came to an end (or so it seems). The final days of 2023 also marked the end of the iconic sponsorship deal that the American golfer and Nike first signed in 1996. After 27 years and over $500 million received by the winner of 15 majors for his image, the partnership has come to an end without either party having communicated publicly whether they are definitively parting ways or will continue to work together in some way. The continuity of an empire that shook global sports is still up in the air, as is the possibility of Nike shutting down its golf division, which was built around the star.

On August 25, 1996, a young Tiger Woods played his last round as an amateur. He ended that phase of his life in style. That Sunday, he won his third consecutive U.S. Amateur Open, which had never been seen before. Two days later, he confirmed that he was going pro, and in a major way. Even before Tiger played a round of golf among the elite, Nike paid him extravagantly: $40 million for five seasons. An iconic TV commercial accompanied the signing. “Hello, world. They say I’m not ready for you. Are you ready for me?” Tiger says on the screen. Phil Knight, Nike’s founder, asserted that “the world has not seen anything like what he will do for the sport.” He was right. Two days later, on August 29, Woods made his debut at the senior level in the Greater Milwaukee Open. In April of the following year, he won his first major as a professional, the 1997 Augusta Masters, and started a revolution. Indeed, nothing would ever be the same.

The first $40 million for joining Nike was just the beginning of a moneymaking partnership for both parties. Tiger severed his previous relationship with Ping and Reebok, and he became an income-generating machine. Nike increased its revenue tenfold, from $30 million a year before the Woods era to $300 million just two seasons after he was signed. To put that in perspective, in 1984, when it signed Michael Jordan, the company gave the basketball player a $250,000 check plus a percentage of Air Jordan shoe sales to convince him not to go to Adidas. In 1996, Greg Norman had the previous best sponsorship deal in golf. Reebok paid him $2 million, 20 times less than what Nike gave the young star. Tiger broke all the molds.

Woods’s game was already an advertisement in itself. Like the chip on the 16th hole of the Augusta Masters in 2005, when the ball rolls smoothly until it falls in the hole at the last second, showing the Nike logo, it was real life, but it seemed to be something out of a movie. So, Nike continued to renew and enrich the star’s contract: in 2001, they gave him another $100 million for another five years; in 2006, eight years for a deal ranging from $160 to $320 million; in 2013, an extension of 10 seasons and $200 million more. That’s a 27-year-long partnership, for which Tiger has earned between $500 million and $660 million. The impact on the company is almost incalculable. Woods’s comeback at the 2019 Masters alone brought the company a profit of $22.5 million.

Nike stood by Tiger even in his worst moments, during his long history of injuries and especially amid the scandal of his infidelity, when many other companies abandoned him (including AT&T, Accenture, Gatorade, Gillette, TAG Heuer, etc.). Nike has continued to outfit Tiger for battle even though it stopped manufacturing golf equipment in 2016. Today, Woods uses TaylorMade brand clubs, Bridgestone balls and FootJoy sports shoes, a special design that the golfer has been using since his terrible car crash in 2021. His next destination may be Greyson Clothiers, which already has agreements in place with his son Charlie, 14, and his close friend on the circuit, Justin Thomas.

The $500 million that Tiger and Nike have earned looks even better in comparison with the $120 million that the American golfer has amassed in prize money during his long career, including 15 majors (behind Jack Nicklaus’s record of 18) and 82 titles on the PGA Tour (tied with Sam Snead, that is the best record in history). According to Forbes magazine, Woods, Michael Jordan ($94 million in NBA salary) and LeBron James are the only three athletes ever to have exceeded $1 billion in net income between their sports payrolls, businesses and sponsorships (Tiger has earned $1.7 billion).

At a time when golf is divided by the advent of the Saudi league, which has notched record signings like Jon Rahm, Tiger continues to behave like the multinational he has always been. Greg Norman, the CEO of LIV, admitted that Tiger turned down between $700 and $800 million to switch sides. For over a quarter of a century, Nike has been paying him like a legend, starting before he even became one.

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