Wednesday, June 15, 2011

Can Phil Mickelson Overtake Tiger As World’s Top-Earning Athlete?

Phil Mickelson faces a monumental hurdle at Congressional Country Club this week in Bethesda, MD.

But if he climbs that mountain, he’ll also close the financial gap on his long-time rival Tiger Woods. And in the process, further elevate his historical status within the game of golf.

Make no mistake, Lefty isn’t hurting for money. Forbes recent rankings of the world’s wealthiest athletes pegs Mr. Mickelson as the 5th wealthiest athlete, earning $46.5 million between May 2010 and May 2011. He trails Kobe and LeBron (2nd and 3rd on the list, respectively) by less than $7 M, and he only trails tennis great Roger Federer by $500,000.

But Tiger currently tops the list at $75 M.

As a golf enthusiast, I’ve watched with keen interest as Phil has tried to eclipse Tiger in the world golf rankings over the better part of the last decade. And though Phil now holds a greater world ranking (Phil is 5th while Tiger is 15th), it’s more because of Tiger’s “undoings” than Phil’s “doings”.

What’s interesting from a historical perspective is to see how the financial gap has changed just over the last several years between 2 of the world’s wealthiest athletes and most successful corporate pitchmen.

Using data from Sports Illustrated’s “Fortunate 50″ from 2008-2010, we see these trends:

- In 2008, Tiger earned $128 M versus Phil’s $62 M.

- In 2009, Tiger earned $100 M versus Phil’s $53 M.

- In 2010, Tiger earned $90.5 M versus Phil’s $62 M.

So relative to 2008 and 2009, Phil is gaining ground…though both men have taken hits over the last 2 years for a multitude of reasons.

In Tiger’s case, his injuries have hampered his on-course abilities and thus have made him a less stable investment. But more importantly, his off-course transgressions likely will torpedo his long-term endorsement opportunities utterly. He’s already seen his endorsement take fall from $105 M in 2008 to approximately $70 M in 2011. If not for Nike or Electronic Arts, he likely would no longer sit atop this list.

In Phil’s case, despite his victory at the 2010 Masters for his 4th major championship, his play continues to be too erratic and inconsistent. Though he certainly scores high on the likability scale given his on-course demeanor, Arnold Palmer-like go-for-broke style, perception of being a family man, and the public’s sympathy given that his wife’s and mother’s recent battles with breast cancer.

And in both of their cases, there is no question that the downtown in the economy lessened corporate willingness to invest so heavily in celebrity endorsers. Again, for Phil’s endorsements to slide from $52 M to $42 M in the year after his 3rd Masters suggests that macroeconomic variables were at play beyond his control.

But what is in his control, at least partly, is whether he can shed the label of unlucky loser at America’s golf championship.

Mr. Mickelson has famously finished 2nd a record number 5 times in the U.S. Open with 9 top 10 finishes. Somewhat astounding when you consider that Lefty isn’t the straightest guy off the tee on U.S. Open layouts where the rough can be taller than your children.

His ability to keep coming back and playing competitively in this tournament is both commendable and surprising all in the same breath, but with his 41st birthday coming Thursday during the opening round of the tournament there may not be many more opportunities to achieve glory on a tour that is becoming increasingly deep with young talent from both sides of the pond.

More than closing the financial gap on his long-time rival Woods, a U.S. Open victory would have the short-term impact of renewing the relevance of the Mickelson brand. His current sponsors would be more likely to extend his current deals while new sponsors may line up as well. It would be too good of a story for them not to. A story of the “hard-luck best man” showing the determination and resilience to finally capture his nation’s golf championship.

And the long-term impact would be to further make a case that he belongs in the discussion of the top golfers to have ever played the sport. As it stands now, only 17 men in the history of golf have won more majors than Phil. But a 5th major would throw him in a class with Byron Nelson and the recently departed Seve Ballesteros while shrinking the afore-mentioned list to 12.

In short, a Phil Mickelson U.S. Open victory at Congressional would boost his endorsement earnings in the next year by $5-15 M above and beyond what they would be if he comes up short again. And in the process, push him ever closer to becoming the wealthiest athlete in the world as Tiger’s wealth will likely continue to dip given his recent form.

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