The Value of Winning the Masters

Every Monday, I write a newsletter breaking down the business in golf. Welcome to the 127 new Perfect Putt members who have joined us since last Monday. Join 1,922 intelligent and curious golfers by subscribing below.

A quick note before we get started:

• Perfect Putt is staying free. I am evaluating running ads with the right partners. I would be grateful if you could fill out this anonymous survey.

Let’s get to today’s newsletter.

Hey Golfers —

Scottie Scheffler rolled to victory at the Masters. Scottie won $2.7 million, which pushed his season earnings over $10 million. In just 13 events this season — he has averaged $775,000 per event.

How hot is Scottie?

Jon Rahm was last season’s money list leader with $7.7 million. There are still 20 events left this season. Insane.

But what is the value outside of the $2.7 million first-place prize?

Here is a quick breakdown of what the Masters winner receives:

• Five-year PGA Tour exemption

• Five-year exemption to the U.S. Open, Open, and PGA Championship

• Lifetime exemption to the Masters

• 600 FedEx Cup Points

• 100 Official World Golf Ranking points

We are going to breakdown the Masters win impact into two earnings buckets:

• On-course earnings

• Off-course earnings

Let’s look at the on-course earnings impact on a Masters win. There are several bonuses that will be positively impacted by winning the Masters.

• FedEx Cup Bonus

• Comcast Business TOUR Top 10 Bonus

• PIP Bonus

Outside of the bonuses — the Masters winner receives 100 OGWR points and Ryder Cup points.

Playing in a Ryder Cup doesn’t have an impact on earnings. Each player receives $200,000 — which is donated to charity. But it will have an impact on marketability for endorsements and equipment contracts.

Winning 600 FedEx Cup points guarantees a spot in the FedEx Cup Playoffs. Last season, 600 FedEx Cup points were good for 91st. A player wouldn’t need to show up to the playoffs and would receive a $130,000 bonus. More importantly, the guaranteed spot in the playoffs provides the opportunity to win the $18 million first-place bonus.

K.H. Lee finished the 2021 season 31st on the FedEx Cup standings with 1,339 points. Using that as a baseline — the Masters winner is 45% of the way to the Tour Championship. Last place (30th) in the Tour Championship wins $500,000.

The Comcast Business TOUR Top 10 bonus is a $20 million bonus pool that pays the top ten players in the FedEx Cup standings at the end of the regular season. Sam Burns finished 10th last year with 1,721 points. The Masters winner is 35% of the way there. Tenth place pays $1 million.

The five-year PGA Tour exemption essentially guarantees a golfer has a job for the next five years. It makes a golfer extremely marketable to sign long-term endorsement deals.

The average PGA Tour earnings for the last five years are below. Nothing is guaranteed in professional golf, but it provides a good baseline of what a winner might expect in the next five years.

Let’s take it a step further. Here is a look at how much money Masters winners earned the season following winning the tournament. Fairly decent distribution; outside of Sergio Garcia and Danny Willet, all players were at the PGA Tour average or above.

Let’s look at the off-course earnings impact on a Masters win.

Off-course money typically comes in three different ways:

• Equipment contracts

• Sponsors and endorsements

• Tournament appearance fees

Off-course earnings present the opportunity to have a significant impact from a money standpoint.

Let me provide two examples of how lucrative professional golf contracts can get.

• Tiger Woods — $500+ million Nike contract

• Rory McIlroy — $100 million TaylorMade contract

The off-course money that follows a Masters win has many variables, including age, prior success, personality, etc. Let’s look at previous Masters winners and their off-course money a year after winning the tournament.

• Angel Cabrera — $7.5 million

• Adam Scott — $9 million

• Charl Schwartzel — $3 million

• Danny Willett — $4 - $7 million

Bubba Watson’s off-course money increased by $3.5 million after winning the 2012 Masters.

It is estimated that Hideki Matsuyama's Masters win would earn him $600 million throughout his career. Hideki was estimated to earn between $8 - $10 million per year in off-course earnings before his Masters win. Hideki will be on the higher end of the spectrum, given his unique marketability in Japan.

British agent Chubby Chandler stated that if a player inside the Top 50 in the Official World Golf Ranking points was to win — a player could see their equipment contract triple in value. Interestingly enough, Scottie Scheffler signed a multi-year equipment contract with TaylorMade just a month ago.

It is estimated that a golfer inside the Top 50 in the Official World Golf Ranking points would see an increase of $15 million per year in off-course earnings — for two-three years following the win.

Appearance fees for a Masters winner significantly increase. According to Chubby Chandler, a golfer could command up to $500,000 in appearance fees in Asia and the Middle East. A golfer without a Masters win would expect around a $50,000 appearance fee.

We can understand that a Masters win will result in millions of dollars separate from the prize money by taking the on-course and off-course money and adding them together. For some golfers, it will result in hundreds of millions.

Have yourself a great Monday. Talk to you next week!

Your feedback helps improve Perfect Putt. How did you like this week's newsletter?

Great - Meh - Bad

If you enjoyed this week’s newsletter, please share it with your friends :)