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The Run to a Billion

For Tiger Woods, 2008 was a year unlike any other. Oh, in some respects it was the same. He finished the year on top of the world golf rankings and led the US in both Ryder Cup points and Presidents Cup points. He came in second in the money list with $5,775,000, despite not playing after June 15, and oh, yeah, he won another major - this time the US Open at Torrey Pines. However, there was that knee injury which required surgery right after the gripping 18 hole Open playoff win and caused Tiger to shut down the rest of the season. So, no, 2008 was unlike any other season, but he did get to spend valuable quality time with one year old daughter Sam Alexis, and, apparently, with Elin who is pregnant again.

Nevertheless, Tiger's quest to become the world's billionaire athlete continued as his earnings didn't suffer much while he was recuperating. The bulk of Tiger's earnings come from endorsements - to the tune of $100 million per year. In dollar value, Tiger's two largest endorsement deals are most likely Nike and Gatorade, which each are supposedly paying him $100 million over a number of years (5 in the case of Gatorade). Those are followed by Gillette and Buick, with his golf course design and development business in Dubai close behind. The Buick deal is up for renewal next year and given GM's financial difficulties, I suspect that it will not be renewed. Of course, that just frees Tiger up to negotiate an even better deal with a car company more suited to his place in the world, like maybe, Porsche or BMW?

The race to a billion dollars may now have a new entrant and one that may well give Tiger a good run for his money, so to speak. With his fifth place finish in the Brazilian Grand Prix, the second year driver Lewis Hamilton grabbed what was denied to him in this race last year, the world championship of Formula One. At the tender age of 23, he becomes the youngest driver in the history of the sport, one that has consistently seen its champion populate the upper reaches of the Forbes list of the highest paid athletes in the world. Assuming his success on the track continues, he is likely to follow closely on the Tiger's heels in the billionaire club. His current contract with McClaren, which runs to 2012, pays him an estimated 75 million pounds over five years, with endorsements bringing in another 30 million pounds. However, when the contract is renewed in 2012, expect that McClaren to jump to about 30 million pounds a year. He has already achieved a first in getting McClaren to allow him to obtain personal sponsors outside the team sponsors; something else which should ratchet up his income before the new contract.

As the first black champion in his sport (his father is black and his mother is white), he is practically a marketer's dream - young, good looking, bright and a winner. A package remarkably similar to Tiger Woods in a sport that is arguably more popular worldwide. If Hamilton's success on the track continues, the future is practically limitless for him and I wouldn't be a bit surprised if he follows Woods into the billionaires club just a few years later.

Full post as published by Sports Biz on November 04, 2008 (boomark / email).