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| 1 minute read

Disruption is par for the course and no one is safe

For many, golf is fascinating viewing, for others not so much. But right now the business of golf makes for particularly compelling viewing.

The Saudi-backed LIV tour is proving very attractive to some of golf’s biggest names and the established tours are starting to feel the pain. While a number of players have remained loyal, other notable stars have decided that the better business decision for them is the one with guaranteed income over the need to compete.

While the purists may find this distasteful, it is really no different to the disruption of new market entrants that we’ve seen play out time and time again across different industry sectors. Golf is not immune from disruption. No business is.

LIV has made a compelling offer to golf's elite professionals and, underpinned by large amounts of investment from KSA, can guarantee them earnings that they’d otherwise have to win. A new model has upset the established order, yet the PGA can combat this because clearly money is not an issue. However, allocation and distribution to players may well be. While this doesn’t yet look like an existential challenge for the PGA, they will need to act and look beyond just suspending players. One possible route would be to reward players for qualifying for the PGA Tour and making the field for any given tournament. It is an accomplishment in itself, so why not reward those who clear this very difficult bar with guaranteed money? This would enable them to compete with LIV commercially – at least in part by mirroring the model to a degree – without diminishing the prestige of their brand. Based on this recent report in the Wall Street Journal, it seems direct financial competition won't be possible. 

Post-pandemic global economics are uncertain and it is likely that we will see more funding and backing from new or unusual sources across a range of industries. The PGA/LIV situation may not interest non-golf aficionados, but it could be a warning to other businesses that nothing is certain and change is the only constant.

In his first press conference since LIV teed off earlier this month, Monahan took direct aim at the Saudis, dubbing the operation an “irrational threat” that isn’t concerned with any return on investment. He also made clear that the PGA Tour can’t match the gobs of money being offered by the Saudis.

Tags

disruption, sport, golf

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