By Olivia London (DC’13)

Srinivasan.Celebrity endorsements are a time-tested marketing technique. Companies spend enormous amounts of money to get famous people’s names connected to their products, but does that actually raise profits? Or are companies merely following unproven strategies from a bygone era?

This is the question Kannan Srinivasan, a Tepper professor of international business and management, marketing, and information systems, decided to investigate. After speaking with some golf enthusiasts in his department, he knew where to start: Tiger Woods. Did an endorsement from the world’s number one golfer help sell enough golf merchandise to warrant the mammoth amount of money Nike reportedly paid him annually?

His conclusions, “The Economic Value of Celebrity Endorsement: Tiger Woods’ Impact on Sales of Nike Golf Balls,” were published last year in the journal Marketing Science. In the 23-page paper, lead author Srinivasan determined:

From 2000 to 2010, the Nike golf ball division reaped an additional pro?t of $103 million through the acquisition of $9.9 million in sales from Tiger Woods’ endorsement effect. Moreover, having Tiger Woods’ endorsement led to a price premium of roughly 2.5%. As a result, approximately 57% of Nike’s investment in Woods’ $181 million endorsement deal was recovered just in U.S. golf ball sales alone.

The findings are just the latest in a long line of business marketing papers that have garnered international attention. It also exemplifies why Srinivasan received the 2013 Fellow Award from INFORMS Society for Marketing Science, which is the largest professional society in the world for the field. The honor recognizes significant accomplishments in the practice of marketing.