Tiger Woods' Cheating Scandal: How Will It Affect His Endorsements?

Bleacher ReportSenior Analyst IDecember 2, 2009

Tiger Woods has never shanked a drive this badly in his life.

First, Tiger was challenged by the outlandish accusations of the National Enquirer, then came the suspicious single-car accident early on Friday morning, and now reports in US Weekly of another affair have put Tiger in some of the deepest rough he has ever stumbled upon.

The last encounter proved to be the tipping point for Woods, who released another statement this afternoon.

In light of his most recent comments, in which he apologized to his family for any wrongdoings, one must begin to wonder if the lucrative sponsorship deals that made him the world's first athlete to amass $1 billion will be affected by the drama of this situation.

We saw Nike drop Kobe Bryant for being unfaithful and Michael Vick for going Cujo on on some dogs.

We saw Michael Phelps lose his deal with Kellogg's after going one toke over the line.

But there was hard evidence in each of those cases.

The lawsuit for Bryant; the infamous bong photo for Phelps; the disturbing images of the dog-fighting compound for Vick.

In this case, we are left with a voicemail that depicts Tiger telling Jaimee Grubbs, one of the alleged mistresses, to change her answering message in order to trick his wife, Elin.

It doesn't prove anything definitively, but it certainly holds enough power to skew the perception of Woods' persona.

I think the huge pendulum swing in the public's view of Woods can best be captured by going way back to 2004, when Forbes Magazine characterized Woods as being the "good looking, clean-cut, articulate, scandal-free golf whiz."

So much for that whole "scandal-free" thing.

For the first time in Woods' storied career, which began in 1996 when he turned pro at the age of 21, he has hit a wall (and a fire hydrant and tree) with his image.

But I still find it hard to believe that Phil Knight and Nike, his biggest endorsers who re-signed him in 2006, will abandon Woods over an issue in which no one knows the full details.

Tiger has exponentially expanded the brand power of Nike, something that even Kobe and Vick couldn't do.

That's because they play team sports, in which there is always a new face to latch your trailer to and start up a new campaign.

In golf, there isn't that sort of thinking when it comes to the face of the game.

It's pretty simple logic: If Tiger represents golf, and Nike sponsors Tiger, then Nike is golf.

And, although this has been anything but a desirable end to his 2009 season, Tiger will undoubtedly come back with the same passion and fire to be the best golfer in 2010.

But there are other organizations with more options on the table that might become weary of the same hazy details that keep Nike on board and in Tiger's corner.

EA Sports struck a new six-year contract with Woods in 2006 to keep producing the video game that bears his name.

In 2007, Gatorade rolled out Tiger's own brand of sports drink in a deal that will earn him over $100 million through 2012.

Along with superstar tennis player Roger Federer, Woods is making between $10-20 million as one of the leaders for the Gillette Champions marketing campaign.

Woods' contract with Buick expires soon, a deal that originated in 1999 and was re-worked in 2004 to the tune of around $40 million.

And those companies may be thinking, what really happened that night?

Where was Woods going?

How did he cut his face?

The answers to those questions are really neither here nor there, but the fact that they are asked exposes the real problem for Woods that arises within the world of sponsorships.

EA Sports can produce a game for Anthony Kim; Gatorade can start making a brand for LeBron James; Gillette can put the workload on Federer; Buick can get David Beckham.

The point is that these other brands are not tied directly to the world of golf, and they have the ability to move away from Tiger and take their business elsewhere.

But aside from Nike, where the world of golf and sponsorships meet, Tiger will indelibly be juxtaposed to Phil Mickelson.

Phil is his closest competition both on the golf course and in his wallet.

In a world built upon the mentality of “what have you done for me lately,” those who award lucrative sponsorships are left with far different impressions of Phil and Tiger at this juncture.

Our most recent memory of Mickelson is as the brave family man, who stood next to his wife, Amy, as she battled cancer.

We can relate to the way Phil took time off to be of the utmost support to her and the family, and those looking to shell out millions of dollars in endorsements will have that at the forefront of their impressionable minds.

On the other hand, we have Tiger, who made his latest statement asking for privacy and apologizing to his family for any indiscretions.

He has withdrawn from his tournament this weekend, and keep in mind that this isn’t your regular tournament withdrawal.

The event functions as a huge fundraiser for the Tiger Woods Foundation; his absence will plummet ticket sales and take money away from his charity interests.

How can current and prospective sponsors not be turned away by those actions, and instead turn to Mickelson to be the pitch-man for their campaigns?

The simple answer is that they can't look away from what might have happened.

So while Nike will more than likely stick by its man, Tiger may see that $1 billion bank account begin taking in fewer deposits going forward.


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