Tiger Woods’ biggest scandals cost several companies he was working with a combined $12 billion.
Before Tiger Woods and Elin Nordegren’s marriage ended, the couple was widely seen as perfect. Then, their marriage came to an end amid a slew of scandals that completely changed the popular perception of the golf great.
Since that scandal, Woods has continued to enjoy a lot of success, which has led to him becoming incredibly wealthy. However, some of the companies Woods worked with lost a staggering amount of money due to the scandal.
This article will reveal how Tiger Woods’ cheating scandal reportedly cost companies a staggering $12 billion. The article will then look at how much money Woods’ infidelity cost the professional golfer.
Tiger Woods’ Business Partners Reportedly Lost $12 Billion Because Of His Cheating Scandal
In November 2009, the public’s perception of Tiger Woods as the ultimate sporting professional took a huge hit. At that time, it was reported that Woods cheated on his wife at the time, Elin Nordegren, with Rachel Uchitel. In the weeks that followed, Woods’ image took a massive hit and so did his many business partners.
After the first accusation was levied against Woods, a slew of other women came forward with their own stories. In the end, it was revealed that Woods habitually cheated on his wife which made the golf superstar one of the most scandalous celebrities at that time.
In 2009, a writer named Claudia Morain published an article on UC Davis’ website. After talking to researchers, Morain concluded that the companies Woods was working with took a combined $12 billion loss following the scandal.
For her article, Morain spoke to UC Davis’ economics professors, Victor Stango and Christopher Knitte. Before the article explained the numbers, Morain quoted Stango who summarized the losses those companies suffered in dramatic fashion.
“Total shareholder losses may exceed several decades’ worth of Tiger Woods’ personal endorsement income.”
For her article, Morain spoke to UC Davis’ economics professors, Victor Stango and Christopher Knitte. Before the article explained the numbers, Morain quoted Stango who summarized the losses those companies suffered in dramatic fashion.
“Total shareholder losses may exceed several decades’ worth of Tiger Woods’ personal endorsement income.”
After studying the numbers, the researchers drew some fascinating conclusions. Most notably, the researchers believed that the seven companies would have been worth roughly $12 billion more combined if it wasn’t for Woods’ scandal.
To explain their conclusion, the researchers argued that the severe hit the seven companies took at that time was very unlikely to have stemmed from normal business stock price variances.
“(This) pattern of losses is unlikely to stem from ordinary day-to-day variation in their stock prices.”
The professors’ research also revealed that certain companies were damaged a lot more than others. Specifically, the researchers concluded that companies with greater ties to the sports world got hit the hardest. Those companies were Tiger Woods PGA Tour Golf, Gatorade, and Nike.
Alternatively, the professors concluded that Accenture, a global management consulting firm, was barely affected at all by Wood’s scandal. As a part of their findings, the professors argued their findings were predictable.
“Economic theory would predict this. For Tiger Woods, having a firm like Accenture as a sponsor probably does not enhance the overall value of the Tiger brand very much, giving Woods a lot of bargaining power when negotiating that deal. If the company therefore ends up paying Woods something close to its extra profit from his endorsement, it isn’t much worse off without him than with him.”
Tiger Woods’ Scandals Reportedly Cost Him Roughly $50 Million
When a slew of companies lose billions of dollars in value, that is a nightmare scenario for those involved. With that in mind, it should go without saying that the companies are going to do whatever they can to mitigate the hurt.
When Tiger Woods’ cheating scandal hit several companies hard, several of them decided they had to act. Unfortunately for Woods’ bank accounts, the resulting actions cost the golfer a staggering amount of money.
According to Bleacher Report, Gatorade, AT&T, General Motors, Gillette, and Accenture all decided to end their deals with Woods at that time. Those deals being terminated resulted in Woods losing $50 million in earnings.
While that figure is stunning, Bleacher Report also noted that there may be more to the story than that. After Woods was rocked by scandal, he went on a slump since he failed to win any tournaments in 2010. Needless to say, that meant that Woods missed out on a fortune in earnings.
Of course, there is no way to know if Woods would have won tournaments if his life wasn’t in upheaval at that time. That said, many people link Woods scandal to his poorer performances considering the timing of his slump and the controversy.
