It's a major award

By Dick Hughes  

JUNE 16, 2011 11:34 a.m. (0)

With 325 million households around the world watching, South Carolina’s first PGA Championship next year at Kiawah Island promises benefits beyond the prestige of hosting an elite field of pro golfers.

The PGA Championship, the last of the annual major golfing events and considered the most competitive, will be held Aug. 6-12 at the Ocean Course at the Kiawah Island Golf Resort in Charleston.

It will be the first time in the PGA’s 94-year history that South Carolina will be the site for one of the four major golf tournaments.  There’s a lot at stake beyond the $8 million in prize money golfers compete for on the fairway.

“It is an opportunity for South Carolina to highlight our tremendous assets to the world,” said Minor Shaw of Greenville, one of several business leaders mobilizing 15 months ahead of the event to make sure maximum advantage is taken to tell the state’s business and tourism story.

“The Upstate should take advantage of this opportunity to showcase our industry, particularly our international businesses, as well as our domestic businesses that are known across the world.”

In an unusual step for a major PGA tournament, the Kiawah sponsors extended its support network to include representatives from throughout the state rather than contain it locally, the usual practice.

Shaw is one of 22 business leaders “who serve as resources or give us first-person contacts with corporations to approach them and sell them on why corporate hospitality is a good idea,” said Roger Warren, president of Kiawah Island Resort and event co-chairman with House Speaker Bobby Harrell.

According to PGA America, 154 hours of live TV coverage will reach 325 million households in 203 countries.  With a demographic weighted with business decision-makers, the audience is considered rich in potential for introducing the state as a good place to locate or relocate businesses, as well as to tour.

The Upstate SC Alliance effectively uses the BMW/Synnex Charity Pro-Am, a much smaller event with far less TV exposure, for that purpose and is pleased with the results.

“If you look at the demographics of your typical golf viewer and player, they generally fit into our target audience due to their business acumen,” said Richard Blackwell, vice president of the alliance.

“So hosting out-of-town guests and advertising around a golf event is a win-win for marketing this community for economic development purposes.”

The region and state will reap some benefit from on-air discussion by the golf commentators and from a limited number of public service spots, but “there is not a lot of formal opportunity other than buying advertising to promote the area,” Warren said.

He believes the South Carolina Commerce and the Parks, Recreation and Tourism departments “will find a way to use this event to promote programs … (and) to build industrial opportunities and tourism, which is still the No. 1 business in the state.”

A spokesman said Commerce does not advertise on television and has no plans to do so for the PGA event.  The Parks, Recreation and Tourism department and the governor’s office did not respond to phone and email requests.

The tournament comes with doubts by PGA America that Charleston with its small market and Kiawah Island with one road in and out “can support a championship,” said Warren.  “We are going to prove them wrong.”

Warren and Brett Sterba, the PGA’s director for the 2012 championship, said Kiawah is taking the unusual step of limiting the fairway audience to 21,000 daily, “about 15,000 less than a typical major championship.”

All tickets must be purchased in advance.  In a record for any PGA championship, 94 percent were sold in a six-week period starting in November.  A record $1.8 million were sold in one day. The last 6 percent, which were held, go on sale after the 2011 PGA Championship concludes in Atlanta Aug. 14.   There will be no sales at the gate.

Sterba said tickets were sold in 47 states and 65 percent of ticket and hospitality sales came from more than 50 miles outside Charleston in contrast to the typical championship where the majority of sales are within a 50-mile radius of the site.

Warren said major championships in the past committed to the expense side “without knowing the number of people who were coming because bigger championships sold tickets up to the very day that you went.

“We turned that around. We said we are going to determine the number in advance by limiting the number of tickets and selling only that number.  A year out from the event, we will know exactly the number of people who are coming.

“It helps us from a business perspective to know what we have to spend to do it right, which reduces the risk of something coming up we don’t count on.”

Warren, who spent four years as president of the PGA and was an officer for 10, said he was able to take “some latitudes” with the usual business model and has been told “that the model we established is something that will be used by the PGA going forward.”

There is financial risk. Out of event revenues, the host site has to cover the $8 million purse and all infrastructure costs, including providing management, bus transportation, spectator seating and police and emergency coverage, Warren said.

There is “no-profit sharing in any regard” of TV revenues with PGA America.

Warren is optimistic that the event will break even if not turn a profit but cautions there are unknowns, not least of all the unpredictability of weather.

He is confident that when the accounting is done and reviews from spectators and players are in, they will prove “the site is worthy of major championships” and Kiawah will “lobby hard” for a U.S. Open and to become the first U.S. site to stage two Ryder Cups, the premier golf event the Ocean Course was built for in 1991.