In early April, on the eve of this year’s Masters golf tournament, RBC rolled out a slick new TV spot in the United States featuring professional Dustin Johnson, whom the bank had signed to a multimillion-dollar sponsorship deal in 2018. Mr. Johnson was the highest-ranked member of more than a dozen PGA Tour and LPGA Tour players known as Team RBC.
The ad, touting the bank’s wealth-management services, showed Mr. Johnson standing on the edge of a rocky cliff, sizing up and then making an almost impossible shot with a suave pivot of his 9-iron. “Dustin delivers, because he sees things differently, and solves problems with uncommon solutions,” explained a stately voiceover, as the camera flashed over an RBC logo patch on the golfer’s sleeve. “So do we.”
But last week, Mr. Johnson’s way of seeing things clashed with RBC’s, when he announced he was joining the LIV Golf Invitational Series, a controversial new league backed by Saudi Arabia’s Public Investment Fund. The move meant he would not be available to play in this weekend’s RBC Canadian Open, a breach of his sponsorship contract. Within hours, the bank cut him from its Team RBC roster, along with another one of its brand ambassadors, Graeme McDowell, who is also joining LIV.
Both RBC and Golf Canada, which oversees the Canadian Open, insist they are focused on what they believe will be a robust success this weekend, their irritation at the developments apparent only when executives at those organizations repeatedly refer to in interviews as “the Saudi league.” And though the episode may prompt questions about the wisdom of aligning with sometimes unpredictable public figures, marketing experts insist the risks are minimal.
The two golfers “made a business decision and a personal decision to join the Saudi league, and that decision was something that RBC was not in favour of,” Mary DePaoli, the bank’s executive vice-president and chief marketing officer, said in an interview this week. “And so we terminated our partnership with both D.J. and Graeme McDowell fairly quickly after that news was shared with us. They made a business decision and so did we.”
After news of his defection broke, workers scrambled to tear down RBC-branded posters of Mr. Johnson that adorned St. George’s Golf and Country Club in the west end of Toronto, where this year’s Open will take place.
The incident lifted the veil on some of the machinations of brand sponsorships, which have become an ever-larger share of athlete earnings. (Last year, tennis star Naomi Osaka famously earned an estimated US$52-million from sponsorships, despite enduring a bumpy year on the court in which she won only about US$1.2-million in prize money.)
Brands such as RBC will estimate the value of prospective sponsorships through the amount of media attention they expect to garner, based on an athlete’s projected success on the field of play. So, while, say, a Masters win would earn a golfer US$2.7-milllion in prize money, the value of the media exposure for the brand might be in the same neighbourhood.
The partnership between RBC and Mr. Johnson had been such a success – earning tens of millions of dollars in U.S. consumer awareness, according to one executive with knowledge of golf-sponsorship contracts who spoke to The Globe – that the original term, which was set to expire in 2021, was extended to 2023.
Still, the bank’s former sponsorship of the star, who had won two majors, was only a tiny slice of its golf-oriented marketing efforts, especially in the United States, where it leverages the sport to grow awareness among consumers. Ms. DePaoli noted that RBC is a PGA sponsor, giving the brand visibility in a series of televised tournaments, and has title sponsorship of the Heritage Classic, played in South Carolina every April after The Masters.
Golf itself is on an upswing. Though many sports disappeared from TV during the pandemic, and then returned with lower ratings than before, golf came back sooner than most, leading to spikes in viewership. And millions of North Americans picked up clubs for the first time over the past two years, especially women and members of visible minorities: prime targets for the bank’s marketing efforts.
All of which both RBC and Golf Canada are saying will lead to more interest this weekend.
Laurence Applebaum, chief executive of Golf Canada, says he is confident the strong field of players will boost excitement in the Open, especially because no players are guaranteed a spot in the tournament – unlike those participating in LIV.
“In my experience, it’s the competitive tension of sport that draws the fan, it draws the reach and it draws the interest,” he said. “And 48 guys in an exhibition is one level of interest, but literally hundreds and hundreds of professional golfers who participate, quite honestly in a meritocracy, they’re there because they’re the best in the world, they’re not there because they were offered a lot of money. I think the proof is going to be in the pudding.”
He added: “Startups tend to have fleeting moments of interest.”
Don Mayo, the global managing director of IMI International, a Toronto-based marketing consultancy, said the drama over the breakaway players would itself likely lead to more interest in professional golf among the public. And he suggested that most fans wouldn’t object to the sort of moves by Mr. Johnson and others to take money from the Saudi government.
“The general fans don’t care. They want to be entertained in sports,” Mr. Mayo said. “Whether they should care more is a moral issue. But if they continue on, the golf fan would not care.”
He added that he didn’t expect any negative repercussions for the bank cutting ties with Mr. Johnson. “RBC and golf will not hurt from it. And I honestly believe that this [development] might actually accelerate fans’ interest in golf, and might expand the field,” he said. “It’s tough to get news coverage. The fact is, this kind of news coverage is great.”