Home / Business / Money / The Woods effect

The Woods effect

Hero MotoCorp has roped in Tiger Woods as a brand ambassador. The 38-year-old golfer will reportedly be paid Rs 200 crore for the four-year contract. That would work out to Rs 50 crore a year. This is way beyond what Indian celebrities from Bollywood and cricket get. Aamir Khan, the most expensive of them, charges between Rs 11 crore and Rs 12 crore for endorsing a brand, while others like Shah Rukh Khan, Mahendra Singh Dhoni and Amitabh Bachchan can ask from Rs 6 crore to Rs 7 crore. Woods, though many would say that his game is in decline and his personal life is a mess, is a much bigger celebrity than any of these. His brand recall is amazing in almost every country of the world. That’s why he comes at a substantial premium to Indian celebrities.

This is the kind of money Indian companies will have to get used to spending as they expand their footprint beyond India. The appeal of Bollywood stars is far from universal, though Shah Rukh Khan is popular in Malaysia and many countries in West Asia, and Rajinikanth, for some inexplicable reasons, has a huge fan following in Japan. Similarly, cricket is not a popular sport outside the Commonwealth countries and Indian greats are unknown entities in large parts of the world. Earlier this year, Russian tennis star Maria Sharapova caused heartburn to all Indians when she disclosed that she hadn’t heard of Sachin Tendulkar! This happened in spite of the fact that Tendulkar is a regular at Wimbledon. She said that she was in awe of footballer David Beckham and basketball legend Michael Jordan, but didn’t have a clue about the Indian God of cricket. This is where people like Woods come into the picture.

Hero MotoCorp, the largest maker of two-wheelers in India, is looking to grow abroad in a big way. So long as it was a venture with equal equity stakes (26-26) held between the Munjal family and Honda, it could not sell in markets where the Japanese company already had a presence. That agreement left very few opportunities for it overseas. But now Honda has exited the company allowing Hero MotoCorp the opportunity to enter those markets. There are several countries in Asia, Africa and the Americas where there is a strong demand for the kind of fuel-efficient and low-maintenance motorcycles that Hero MotoCorp makes. And it needs a celebrity endorser to build its brand equity quickly in these markets. However, there are also problems with finding the right celebrity. After all, are Woods and golf the right fit? Woods is scandal-hit, and no longer dominates the golf world as much as he once did. And there’s golf’s own image – the kind of commuter motorcycles the company makes are used by people in the middle-income categories, whereas golf is a rich man’s sport. But it could be argued that golf also has a lot of aspirational lifestyle value attached to it which may have a positive rub-off on the motorcycles. Still, the company seems to be preparing to hedge its risks: according to news reports, the company may also sign Colombian football star and Real Madrid midfielder James Rodriguez as a brand ambassador.

This deal shows there is growing urgency among Indian companies to build their brands abroad. That is why TCS has become the sponsor of the New York Marathon. Earlier, Satyam Computer Services (now merged into Tech Mahindra) was appointed by FIFA as the official information technology partner for two football World Cups – South Africa in 2010 and Brazil in 2014. The work included event management, hospitality management, automatic ticket terminals, et cetera. Though the company pulled out of the Brazil leg, it did create visibility for itself in South Africa. More such deals could happen in the days to come as Indian companies expand abroad.


Check Also

Rupee recovers 6 paise to 67.01

The rupee today recovered some lost ground by rising 6 paise to ...

Notes ban to have positive impact on economy

NEW DELHI: The government’s demonetisation move has led to widespread adoption of ...