Heritage golf tournament will find new title sponsor, predicts Clemson economist

Raymond Sauer has little doubt Hilton Head Island will eventually find a new title sponsor for its PGA Tour event.

The economics professor at Clemson University said current instability in the business world means organizers of the Heritage golf tournament might not sign a new title sponsor in the immediate aftermath of last week's announcement that Verizon will not return as title sponsor after 2010.

But there should be plenty of candidates after companies collectively get back on their feet, said Sauer, who has written extensively on the business of sports and is chairman of Clemson's Department of Economics.

"There's someone out there that's going to see this as an opportunity," Sauer said.

Sauer said he is so optimistic because the rise of television as an influential force in sports over the past 30 to 40 years has combined with increases in consumers' leisure time and incomes to make sponsorships of events such as the Heritage immensely valuable.

Many companies have cut corporate sponsorships during the recession, but the pool of companies eager to get on television in front of an attractive demographic group remains relatively large, Sauer said.

"That upward trend has still got legs in it, I think," Sauer said. "The trend and the thrust is still there."

Another factor working in the Heritage's favor: Its relative renown among the tour's destinations.

"It's not Pebble Beach, it's not Augusta, but everybody knows the week after Augusta they go down and play the Heritage on Hilton Head," Sauer said. "I would suspect, because of that, someone who wants to use the PGA to increase their brand awareness is going to come along and the tournament there is going to survive."

There are signs the market for sports sponsorships is recovering, even among the financial sector, which was particularly hurt by the global downturn, Sauer said. For example, English football club Liverpool recently surprised Sauer by signing a deal with Standard Chartered Bank to replace the brewer Carlsberg as the club's primary sponsor.

So which company might come to the Heritage's aid?

That's hard to tell, but it's likely to be an outsider, Sauer said.

He doubts a company with a presence in South Carolina will be willing or able to pay an estimated price tag of $7.5 million to $8 million to put its name on the Heritage.

The company that emerges to take over sponsorship of the Heritage need not be a household name, said Jon Podany, the tour's senior vice president of business development. He cited as an example contact lens maker Transitions, which sponsors a tour event in Tampa, Fla.

PGA Tour officials are on the constant lookout for potential sponsors, Podany said. And some focus solely on title sponsors, said Steve Wilmot, the Heritage's tournament director.

Although the tour probably will focus first on filling the four openings that remain on its 2010 schedule, a company could decide it would rather wait until 2011 to sponsor Hilton Head's tournament, Podany said.

A boat company, for example, would probably be more interested in sponsoring an event on Hilton Head than it would in Memphis, Wilmot said.

Tour officials expect to work closely with Wilmot's Heritage Classic Foundation to share leads, Podany said.

Wilmot's list of prospects grew significantly in the days after news surfaced Tuesday of Verizon's decision, he said.

He has been overwhelmed by phone calls and e-mails, he said. Many of those messages were from people interested in discussing a potential sponsorship or passing along information to corporate contacts.

Some will realize quickly they're not suited to make such a commitment.

"It's real easy for some people to say, 'Oh, I didn't realize it was that much,' " Wilmot said. Including expenses, such as travel costs, sponsoring the Heritage cost Verizon about $10 million per year, he said.

Despite that cost, Wilmot wasn't as quick as Sauer to discount in-state companies.

After attending Thursday's State of the Region breakfast sponsored by the Hilton Head Island-Bluffton Chamber of Commerce with other business and civic leaders, Wilmot quickly listed several name brands that do business in the Palmetto State.

"Obviously, you can tell we're thinking about this," he said.

Ultimately, a factor other than geography will be more important. "There might be some perfect marriages out there," Wilmot said. "But it comes down to dollars."

Wilmot said he has spoken regularly with tour officials since Tuesday's announcement.

He would like to have a sponsor in place before next year's tournament in April, and he would be "getting nervous" if that hasn't happened a year from now, he said.

Meanwhile, considering the possibilities has been energizing for Wilmot and his staff, he said.

"The term we're using around the office is 'a blank sheet of paper,' " he said.

TELL US WHO COULD TAKE VERIZON'S PLACE

What kind of company might fill Verizon's shoes as title sponsor of Hilton Head Island's PGA Tour event? A big company or a relatively small one? A foreign company or a domestic one?

Who do you think would be a good fit? Whom would you like to see?

Tell us by commenting on reporter Josh McCann's Lowcountry Business blog at blogs.islandpacket.com/lowcountrybusiness.