RBC Stepping in to Save Heritage?

That’s the rumor that’s been circulating since key advisors to Royal Bank, sponsor of the Canadian Open seemingly half the leaderboard of any given field, were in the Carolinas last week sizing up the tournament. RBC has already invested upwards of $15-million annually on golf in the way of a sponsorship of the PGA of America (including deals for the PGA Championship and Ryder Cup), as well as “Team RBC,” which includes the likes of Ernie “I’m using a long putter” Els, Matt Kuchar, Mike Weir, Stephen Ames, Anthony Kim, Jim Furyk, and almost world No. 1 Luke Donald.

RBC’ Jim Little, the company’s chief brand strategist and the man behind the golf/marketing strategy, told today that indeed the bank has been approached by the PGA Tour, which ran the historic Heritage event his year without a title sponsor, but has said it will not do so for another year.

“[The PGA Tour] have approached us as part of normal course, as we look at lots of things,” Little said by e-mail. When asked whether it was something RBC would consider, Little responded jokingly that,

“‘We will put the marketing muscle of RBC behind golf to build our brand at home and abroad,'” said a mid level marketing manager in Nov 2007…….

However, Golf Digest is reporting that a four-year deal is nearing for RBC:

Several players and sources related to the tournament told Golf World that RBC is close to signing a four-year sponsorship deal. Talk about timing: RBC already received nice exposure with two of its players, Donald (shown) and Jim Furyk, in the final pairing.

RBC may well be interested, but given its track record, it will surely be trying to hold the PGA Tour’s feet to the fire when it comes to negotiating a price. Since the economic downturn in 2008, RBC has emerged as one of the most powerful (read companies with the highest market cap) sponsors on the PGA Tour. When the tour didn’t offer it the Buick Open date in late July when that tournament dissolved, RBC sought out the PGA deal as a means of showing Tim Finchem that it could invest in golf without the PGA Tour. RBC is also on record as saying it paid a much lower price to sponsor the Canadian Open than Bell Canada did previously.

RBC does have a significant presence in the Carolinas through its retail banking division (the former Centura Banks). However, there have been reports in recent months that RBC is looking at exiting the U.S. retail banking business.

What does this mean for the Canadian Open? Probably not much. From what I hear, RBC is pretty satisfied with the date it has following the British Open because it gets the tournament at a cut-rate price. And the bank has been very clever at circumventing the tour’s rules on appearance fees by doing deals with numerous star golfers who will surely show up in Vancouver in July.

One things for sure — Little and his team (which includes Steve Marshman and his team at Catalyst Sports, arguably the most powerful man in Canadian golf these days) is likely to drive a hard bargain. And it may be a bargain that Tim Finchem has no choice but to take.

Interestingly, the Heritage’s tournament director downplayed the RBC news, saying it was interfering with getting a deal done:

Tournament director Steve Wilmot said RBC has been engaged in discussions with the tournament “in the past,” but he pleaded with people not to believe the latest report.

“Help me out here,” Wilmot said late Monday morning. “It’s not true.”

Such scuttlebutt could hurt the tournament if other prospective companies think a deal is already done, he said.

“It’s hurting us because we’re engaged with so many companies,” Wilmot said. “We’re not in negotiations with any of them.”

There won’t be an announcement “in the near future,” he said

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Robert Thompson

A bestselling author and award-winning columnist, Robert Thompson has been writing about business and sports, and particularly golf, for almost two decades. His reporting and commentary on golf has appeared in Golf Magazine, the Globe and Mail, T&L Golf and many other media outlets. Currently Robert is a columnist with Global Golf Post, golf analyst for Global News and Shaw Communications, and Senior Writer to ScoreGolf. The Going for the Green blog was launched in 2004.

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