The world of golf is calling “fore” after the PGA Tour bet that its strong brand image will be enough to protect it from being associated with the some of the more negative brand aspects of Saudi Arabia.
Earlier in June, the PGA Tour announced that it will merge with the Saudi Arabia-backed LIV Golf.
The golfing body then calmed everyone’s nerves by saying: “Fans can be confident that we will, collectively, deliver on the promise we’ve always made – to promote competition of the best in professional golf and that we are committed to securing and driving the game’s future.”
This sentiment is in stark contrast to what PGA Tour commissioner Jay Monahan said just before the merger announcement. He claimed that anyone who joined LIV would be “helping the Saudi regime ‘sportswash’ their reputation in return for tens of millions of dollars.”
So, now that the merger is going ahead, is everyone friends again?
It’s tough to know from the outside. But it really does look like the PGA thinks its brand is big enough to shoulder any image problems that might appear from the partnership. Brand is cumulative, and the PGA Tour has spent decades building a positive, collaborative image.
The Saudi Arabian Public Investment Fund (PIF), the financial vehicle behind the LIV, clearly recognises that PGA Tour’s brand has gravity. The merger will position PIF director Yasir al-Rumayyan as chairman but keep Monahan on as commissioner so it can have a hands-off approach to running the new golfing body.
Essentially, Saudi Arabia does seem to be more focused on putting its enormous wealth to work. In that sense, the merger is surely a win for the PIF, but it’s also an implicit admission that the PGA Tour brand is synonymous with the sport of golf.
The thing is, it’s not the first time a merger between two major sports bodies has occurred where the brand of one party became more powerful after the deal closed.
A good example was the merger of the American Football League (AFL) and the National Football League (NFL) in 1970. While it’s not directly analogous, it shows how a brand can emerge stronger after a merger deal.
The AFL was established in 1960 and quickly posed a formidable challenge to the better-known NFL, attracting top talent and securing lucrative television contracts. This rivalry led to bidding wars for players and drove up player salaries, causing financial strain on both sides.
It’s fair to say that the two leagues didn’t like each other. Rivalries are like that. After six years of rancorous debate, the leagues began discussing a merger. An agreement was eventually reached, and the merger was formally announced for the 1970 season to allow the leagues time to solve logistical and financial wrinkles.
The merger eliminated the competition between the two leagues, reduced the financial strains and allowed for better scheduling and coordination. The Super Bowl, which had started as an interleague championship game between the AFL and NFL, also became the official championship game.
But the merger had brand problems, such as how to integrate the teams from both leagues while maintaining their individual identities and fan bases. Not an easy task.
To solve these concerns, the new league held onto the historical identities of the teams from both the AFL and NFL. For example, the AFL’s New York Jets and Kansas City Chiefs were allowed to continue using their distinctive logos and uniforms. The same applied to NFL teams like the Green Bay Packers and Chicago Bears.
Another critical decision was to use a single name “National Football League” to reinforce the idea of a single, unified entity and help create a cohesive brand.
The merger was a huge success for the sport of football. The NFL expanded its television coverage, attracting a larger audience and securing lucrative broadcasting deals which allowed it to invest in stadium upgrades, marketing and player development.
Today, who remembers that the AFL existed at all? That merger should be a case study for the upcoming PGA/LIV deal.
Both the PGA Tour and LIV will no doubt be full of smart people who understand that explaining the reasons for a merger is only half the battle. They likely know that about 70-90% of mergers fail, so success depends on winning the golf world’s hearts as well as their minds.
This is where the new golfing body can learn from the AFL/NFL merger.
It should confidently outline tomorrow’s vision in a way that galvanises everyone who plays golf while also showing how the merger will help everyone – at any level of the game – to become more successful.
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