Natural Evolution of Advertising Hits Golf

Editor's note: In last week's BrandCast, Doug Pirnie mentioned ProBagAds as one example of how sports marketing continues to find ways to evolve. Here's Michael's take on the new product.

ProBagAds might be changing how player sponsorship and advertising for golfers work. SBJ reports the company has released a golf bag with a built-in H-D, weatherproof digital display that can show advertisements, similar to the outdoor digital billboards that are growing in popularity. Tour player Michael Allen debuted the bag in August.

At a time when sports sponsorships have come under fire, hitting golf particularly hard, and with technology innovation creating new, potentially valuable inventory this product is a natural fit. For those who say digital advertising on a golf bag would mar the traditions of the game should go look at what sponsorship has already activated, look at the Fed Ex Cup format, and the purses that golfers earn at each tournament. In the end, if golfers want to earn the big paychecks and support each other, the golf community needs to be open to these ideas.

Don’t expect to see Tiger or Phil walking this course with these bags anytime soon. They don’t need to, since they garner so many top notch sponsorships. It’s targeted to the middle and lower tier players, those scrapping through with less fanfare. Even if those player’s previously had sponsorships, those sponsors have to question the ROI of paying individuals with less media exposure and less probability of contending for wins. This brings those players back in play – and creates potential opportunities for tournaments and the Tour itself to boost revenue.

I envision a formula similar to online ad networks emerging, where ProBagAds (or an agency representing them) will sign players on to use the bags for a percent of revenue generated from their bag. This incentivizes and rewards good play, since golfers who make the cut have four rounds of inventory instead of two, plus national television exposure on the weekend. ProBagAds can find a way to price inventory different for players in contention receiving more media exposure on the weekend, and subsequently pass through the additional revenue to those players.

On the sponsor side, ProBagAds can then go sell a network of inventory across many players to the sponsors. This mitigates the risk of sponsoring an individual, expands the reach and exposure of a golf-based campaign, and reduces the cost of entry by sharing it across many advertisers. Further, the digital component offers space for more compelling creative, calls to action, and better recognition overall thanks to the clarity of the screen. Inventory is probably best sold on a time basis, similar to TV.

While more complicated, tournaments and the PGA Tour could potentially get a stake in the process by signing up players without other sponsorships and offering some form of compensation. Then they could sell advertising or create more value for current sponsors, and use that to help underwrite the growing purses that have put some tournaments at risk.

Outdoor digital advertising works, and works well. The economics are sounds – the screen only costs $2500-$4000 to install, which the product will easily make it back in short order. It’s a great way for brands to get involved with the sport without committing big money, a way for players not earning millions to supplement income, and golf properties to earn incremental revenue. The questions remains though, who will play the role in sales and representation as the product evolves.

Michael is studying for his MBA at NYU’s Stern School of Business, with a focus on business development and strategic planning in the sports industry. A passionate sports fan, Michael revels in the use of statistical analysis in sports, and continues to pursue that in his leisure. In addition to sports, Michael brings a strong interest in media, with a focus on the shift to digital media and the transformation of cable. Don't forget to check out Michael's previous posts. More of Michael's insights can be found on sennosportsbiz.com and he can be followed on Twitter at twitter.com/mjsenno.