Farewell to the PIP: $290 million down the drain?
With more than a quarter of a billion dollars divvied up between 30 players, several of whom jumped ship anyway, is there a bigger waste of money in sports than the PGA TOUR's Player Impact Program?
The fourth, and final, PGA TOUR Player Impact Program (PIP) results were announced this week.
For the third time in four years, Tiger Woods came out on top.
It took Tiger’s total of the $290 million PIP takings to $45 million, ahead of fellow TGL backer Rory McIlroy ($35 million) and Jordan Spieth ($24.5 million).
As with any significant investment of cash — and more than a quarter of a billion dollars is a significant investment of cash in any man’s language — it’s natural to ask for, and expect, a return on the investment.
So what’s been the ROI for the PGA TOUR since the decision to introduce the PIP in 2021?
To try to answer that, let’s rewind for a moment and consider just why the PIP was rolled out four years ago in the first place.
Back in 2021, LIV Golf was just a Greg Norman wet dream an idea, but talk of disruptive new tours was rife. A so-called Premier Golf League, or PGL, was being strongly mooted, a notion that seemed to resemble UK soccer’s Premier League, where 20 clubs broke away in the 1990s to establish, and market much more effectively, a brand new top tier event.
That move in the UK 30 years previously was in response to an existential threat: English clubs had fallen from their place at the top of the European game, faced years in European exile following the 1985 Heysel Stadium tragedy amid pervasive hooligan problems, and it was easy to pick up a ticket to a Saturday match — if you were brave enough to go. Three decades and tens of billions of pounds in value created later, it’s easy to see the fruits of that labor.
Executives at the PGA TOUR, as guardians of the world’s top golf tour, knew they also faced an existential threat in 2021: a new breakaway premier golf league, no matter what it would be called, with the top 20, or 30, or 40 players in situ, could immediately and forever relegate the PGA TOUR to second division status.
Tradition and heritage are worth plenty, but money always talks and money always walks.
So the PGA TOUR sought to head off the clear and present danger with the announcement of a new program which would reward the game’s top players in the one way they were almost certain would work — by dishing out spades of cash that would greatly inflate the top players’ tournament earnings and existing lavish sponsorship deals.
It was a transparent, if unspoken, admission from the PGA TOUR that in its previous guise, its distribution of rewards had been too equitable, or too stingy, or both.
Too many journeymen were getting a slice of a pie that was baked by a handful of players at the top of the tree.
In effect, the PGA TOUR had got way too socialist, and the PIP was their way of redressing the balance towards the tried and tested American ideal of rewards accruing to those who created the most value.
In doing so, the thinking went, it would keep the value-creators happy — and value here is defined in large part as getting, and keeping, that most priceless of things in the fragmented world of the 2020s.
Attention.
Within a year or so, it was clear that the problems ran deeper than just forking off a few million quid a year to the top players.
If money always talks and money always walks, then when someone with deeper wallets shows up, you can’t exactly complain when the exit doors start swinging.
Of the 10 beneficiaries of the PIP in 2021, half — Phil Mickelson, Bryson DeChambeau, Dustin Johnson, Brooks Koepka and Bubba Watson — joined LIV Golf within a year and they were followed in 2023 by another, Jon Rahm, all of them on massive signing-on fees.
Among the most fervent criticisms of the PIP was its somewhat ridiculous “black box” nature.
For a fund that was trying to reward the halo created by positive social media attention, it was ironic that almost nothing about the PIP was transparent.
The top 10 or 20 were announced, to much or little fanfare, each year, but at no time during the previous 12 months was there any indication of who sat where in the standings.
In 2022, when the fund was increased from $40 million to $100 million — almost certainly in response to the head of steam being built up by Saudi Arabia’s Public Investment Fund which would lead to the launch of LIV Golf that summer — under what criteria could social media darling and rapidly rising on-course star Max Homa ($3 million in PIP money) really be judged to have delivered the same “impact” as Kevin Kisner?
Speaking on the Fore Play Golf podcast in early 2022, former Tour pro turned broadcaster Colt Knost said:
“I think it’s stupid … You could do so much more with that money, whether it be in the purses, or the KornFerry Tour, put it in the FedEx Cup. I don’t like that you don’t know who wins, I don’t like that you don’t know where you stand throughout the year.
“This should all be out there and it’d be cool. I’d be fine with it if you’d just let us know how it’s going. This is who’s leading, this is who’s in 10th. And if you’re in 11th, you gotta do something crazy to get a bunch of likes and move up!”
Almost three years and another $250 million later, it’s hard to disagree that all that money could have been put to better use if it were lodged somewhere other than the bank accounts of the already rich.
In the spirit of free market capitalism, nobody should be bitter about the ability of Tiger, Rory and others to cash in on their special combination of generational talent, photogenic personalities and global fame.
But the PGA TOUR is, or should be, something different than a defensive effort to pay exorbitant loyalty fees to the biggest names. The TOUR is not and never was just about making sure the biggest names kept earning more and more money, irrespective of whether they actually played or not. (Tiger’s $10 million for his 2024 impact came despite just five tournament appearances, ending in three missed cuts and one WD.)
Golf, at all levels, is and always has been an extreme meritocracy.
There is, literally, no hiding place. Play better, do better.
More and more, though, top-level golf — as with every other pro sport, and indeed every business around the world — is about much more than just merit.
It’s about attention.
No matter what story we’re trying to tell or which gizmo we’re trying to sell, you, me and Rory McIlroy are all competing for the same six-inch screen and a minute of someone’s mind.
The Player Impact Program recognized that fact, but instead of fully embracing it and creating what might have been, to some fans, a fun second order of merit, one where attention-grabbing stunts were the order of the day — completing the journey from Jack to Jackass — it wrapped it in tinfoil and refused to reveal the inner workings of its ranking criteria, each year picking a handful of players who would join Tiger and Rory in the annual dispersal of favors.
Four years on, and almost nothing in the way of true value created for the PGA TOUR’s $290 million investment — because let’s face it, the players who were embracing social media branding were never doing so just to pick up a couple of million of PIP money; they were doing so to build their own personal brands that could rake in way more than that in sponsorships — the PIP has now come to an end.
If you’re interested in meritocracy, openness and true competition, you might say farewell and good riddance.
You might also hope that the Player Equity Program (PEP) which is replacing it will be a much better version.
At first glance, it looks like it could be be more of the same.
If the PIP rewarded a handful of top players based on some ill-defined impact criteria, the PEP has the look of the same ice cream in a slightly different flavor.
From an NBC Sports article last April (emphasis mine):
The initial player equity grants will be approximately $930 million distributed to 193 players via four categories, starting with the game’s stars. Monahan informed players on Wednesday via a letter of their individual grants.
…
The first group includes 36 players receiving $750 million in equity based on the last five years of play. “Career Points” will be awarded based on how many years a player has been a Tour member, how many times they earned a spot in the Tour Championship and how many times they have won, with extra points awarded for high-profile victories like the majors, The Players Championship and the FedExCup.
Thirty-six players receiving $750 million based on “Career Points” won over the last five years?
That doesn’t really sound a million miles from from the PIP pattern of a small handful of big-name players getting another big slice of earnings on top of all their other income.
The key difference, and the one thing that might give everyone hope, is that “Career Points” seems to be more meritocratic than black-box impact criteria.
Here, too, though, it seems that the whole thing will boil down to another cash bonanza for Tiger. Golf.com calculated last year that TW could receive 528 of those “Career Points”, Rory McIlroy 199, and Jordan Spieth and Justin Thomas both around the 100-point mark. Divide that on a pro rata basis and it looks like Tiger will be getting his hands on quite a chunk of that initial $750 million, likely enough to put his $45 million PIP earnings in the shadows.
In one projection, Joe Pompliano, of the
sports business media brand, predicted that Tiger could get $100 million of the initial equity, although Pompliano also stressed that the equity basis of the deal, and the way that equity would vest, might at last deliver some guaranteed return on investment for the PGA TOUR — through the loyalty of all the players who would get their cut.
“These equity payments will vest over eight years, with 50% coming by year four, another 25% in year six, and the remaining 25% in year eight.
The payments are small compared to what LIV has handed out—Tyrrell Hatton has a $60M+ deal with LIV—but they represent an essential step for the PGA Tour.
These payments will help the PGA Tour retain talent by locking up big-name players with multi-year equity vesting agreements (like a startup would).
There will be little to no liquidity in the secondary market, so players can't take the payment, sell shares, and then jump to LIV later on for a larger check.”
So there you have it.
The PIP is dead! Long live the PEP?
Thanks for reading.
Till next time.
What do you think about the PIP, PEP and the ways the PGA TOUR has been rewarding its members?
Have your say in the comments below.