Recession Raises Doubts About Future Of Senior Players

August 11, 2009|By Mike Klingaman | Mike Klingaman,

Constellation Energy Group remains committed to sponsoring golf's Senior Players Championship at Baltimore Country Club in October, but an executive acknowledged Monday that the recession has raised concerns about its involvement beyond 2011.

"This would not be something that we'd take on if there was no contract in place, but we will uphold our [five-year] commitment," said Stacey Ullrich, Constellation's executive director for marketing and community outreach. Organizers held an event Monday to launch awareness of the tournament, which raised $400,000 for local charities in each of the past two years.

The parent of Baltimore Gas & Electric Co., which said it was on the brink of bankruptcy last year, agreed to be the tournament's sponsor beginning in 2007 after Ford withdrew its backing for the Dearborn, Mich., event. Constellation moved the tournament to Baltimore Country Club, which will host the event through 2010 and has an option for the following year.

"We're just going one year at a time. The economy is the big reason," tournament director Steve Schoenfeld said. "But we feel confident that this event will be welcomed somewhere in 2011."

Companies have pulled various sports sponsorships during the past year in light of the economic turmoil. For example, Black & Decker's DeWalt division in Towson decided to drop its sponsorship of NASCAR driver Matt Kenseth. General Motors, which filed for bankruptcy protection, pulled its commitment to both Tiger Woods and the Buick Open.

In June, McDonald's bailed out of the LPGA championship at Bulle Rock in Havre de Grace - the third women's golf tournament to lose title sponsors this year. And Bank of America yanked its sponsorship of a golf tournament on the Champions Tour in Concord, Mass.

"We're in challenging times, no question," said D.A. Weibring, the 2008 Constellation champion. "There has been a scrutiny of companies and their entertainment dollars, and we've had some title sponsors drop out."

Constellation executives are trimming the tournament budget this year to keep costs down. The Baltimore-based company faced a near-bankruptcy last fall amid the global financial meltdown.

As the crisis unfolded, Constellation executives first agreed in September to sell the entire company to Warren E. Buffett's MidAmerican Energy Holdings Co. for $4.7 billion. But they later pulled out of that deal in favor of a pending $4.5 billion transaction to sell half of their nuclear power business to Electricite de France.

Organizers of the Constellation tournament are concerned that the recession will keep the remaining smaller sponsors - about 100 - from spending money on the event this year in Baltimore.

"The title sponsor can only do so much," Ullrich said. "We're all concerned about the economy. Donations may be down. We're the only major golf tournament left in the Baltimore area, but Constellation can't do this alone."

Support from satellite sponsors is critical, tourney officials said.

"Some companies have downsized" in their giving, Schoenfeld said. "We've lost about 10 sponsors, but we've gained some, too. Overall, we're treading water. It's about a wash."

Look for a sluggish recovery for events such as the Seniors Players Championship, said Bob Dorfman, a San Francisco-based sports marketing consultant and author of The Sports Marketers' Scouting Report.

"Sponsorships will return to golf because they are too valuable a commodity to not turn around. But the marginal tours [such as the LPGA and Seniors] are a little iffier."

Demographically, Dorfman said, golfers are middle-aged and "a very lucrative and big-spending audience," making them ideal for certain products. And he predicted that the senior tour will become more attractive as some of today's top golfers get older and graduate to the tour.

But right now, in the soft economy, the senior tour isn't likely to rebound as quickly as some other sports, Dorfman said.

For events such as the Senior Players Championship, he said, the trick to keeping longtime sponsors and attracting new ones is to concentrate on the basic allure: the ability to use a tournament to reward employees, network with clients and establish new business, and build community relationships through charitable work.

Meanwhile, tourney officials here are finding new ways to make ends meet while maintaining fundraising at the current $400,000 mark - making it the largest sports-related charity event in the Baltimore area, Constellation officials said. The event is from Sept. 28 through Oct. 4.

"We're making cost-cutting changes this year, everything from sending electronic invitations [instead of paper] to buying stuff like food and uniforms locally, rather than having it shipped in," Ullrich said. "We have to think more efficiently and strategically.

"Things are unclear now for Constellation Energy, but we want to keep Maryland on the sports map."

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