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Women's Tennis: Back On Serve


The improbable moment when the fortunes of the stumbling women's tennis tour began to turn around took place inside the small office of Wimbledon referees last June. There, just two months into his job as CEO of WTA Tour Inc., Larry Scott gathered a handful of top pros and laid it on the line: Work together to step up efforts with sponsors, fans, and the media, or the game would continue to flag. Says Scott: "I told them the definition of insanity was doing the same things over and over and expecting a different result."

Under Scott, the tour is casting off its crazy ways. His bridge-building skills are unifying the archipelago of entities -- players, tournaments, management companies, and Grand Slam events -- that operate independently, and more often than not, at odds. As a result, the tour is starting to harness its potent stable of sexy, athletic, and bankable stars. "The WTA finally has everyone pulling in the same direction," says Stephanie Tolleson, head of tennis for management powerhouse IMG. The results are already visible: new sponsors, more prize money, and even a 9% boost in attendance so far over 2003, which saw a dip from 2002.

That's not to say women's tennis suddenly is serving all aces as the French Open gets rolling. An epidemic of injuries has left the tour resembling a hospital ward in recent months. Serena (knee surgery) and Venus (muscle strain) Williams have played only a handful of events since squaring off at Wimbledon last summer, and Serena seems less interested in tennis than in her acting and fashion design careers. Top-ranked Justine Henin-Hardenne lost early at Roland Garros after being sidelined for six weeks with a viral infection. Second-ranked Kim Clijsters won't play because of a wrist injury, and gimpy feet have kept three-time French Open champ Monica Seles off the tour for a year. For a sport dependent on personalities and rivalries, that spells trouble.

But it could be a lot worse -- and was. Scott inherited an organization in disarray. When he took over, the 39-year-old, who had played three years on the pro circuit and spent nine years as COO of the men's ATP Tour Inc., became the WTA's third chief in six years. Tour revenues were down 40% in 2003 because global sponsor Sanex, a unit of Sara Lee Corp. (SLE) that makes body-care products, had pulled out. The WTA board spent much of its time squabbling, and the tour was running a seven-figure budget deficit.

To clean house, Scott has built consensus in a manner that's drawing comparisons to Ladies Professional Golf Assn. Commissioner Ty M. Votaw, whose business savvy has stabilized women's golf. "The mentality used to be: Let's get our share," says Scott of the me-first attitude of players and tournaments that turned sponsors off. "I want the WTA to have a reputation as one of the most sponsor-friendly sports in the world." Scott's other measures include a five-year fiscal plan, streamlining the board from 11 members to 8, and bringing in a professor of human relations from Harvard Business School to smooth decision-making.

Most important, Scott has jettisoned the idea of a global sponsor, instead breaking the tour's properties apart by region to squeeze as much out of the brand as possible. The tour has sealed deals worth $15 million over five years with appliance maker Whirlpool (WHR) in Europe, Dubai Duty Free in the Asia Pacific/ Africa/Middle East region, and media company Tom Group, a subsidiary of Hong Kong-based Hutchison Whampoa, in China. Sponsor dollars are 15% higher than when Sanex was on board. Prize money is up from about $52 million last year to $58 million in 2004, tour officials say.

Scott also has shown a deft political touch. He persuaded the WTA board to restructure the tour's budget -- now in the black -- so that players and tournaments receive their share of sponsor money only after the WTA meets its operating and marketing costs. He has made pre-tournament interview sessions mandatory and enlisted stars to make more appearances for sponsors. "Anything Larry has asked us to do has made sense," says two-time Wimbledon and U.S. Open champ Venus Williams, who at Scott's urging has met with potential sponsors such as Vodafone Group PLC (VOD) and Bed Bath & Beyond Inc. (BBBY). "He has a handle on what our brand is all about and what we can offer in the marketplace."

"FEMININE SIDE"

Critics of tennis as a business have long pointed out that it lacks a major U.S. TV broadcast deal because each tourney controls its own rights. Ratings for women's tennis on ESPN have been flat or in decline for the past couple of years, and the U.S. Open women's final has slipped in 2002 and 2003. Insiders say Scott played an important behind-the-scenes role in helping the U.S. Tennis Assn. cobble together its recently unveiled U.S. Open Series. The novel TV package groups 10 formerly independent men's and women's tournaments on CBS, ESPN, and NBC leading up to the Open, providing more coherence for fans.

Scott is also troubled by the rash of injuries. He is looking at everything from pushing back January's Australian Open a week or two to allowing top players to compete less and still maintain their rankings.

Some insiders worry that the tour's pipeline of emerging stars is dangerously thin. With head-turners like Martina Hingis and Anna Kournikova either retired or close to it, the tour is banking on relatively unproven newcomers such as sassy 17-year-old Russian Maria Sharapova to keep sponsors and fans engaged. Sharapova has been featured in the tour's "Get In Touch With Your Feminine Side" marketing campaign and will be among the first subjects of a new magazine-style TV show debuting on the Tennis Channel this summer. "You can't fabricate the personality factor," concedes Scott. But as he's demonstrating, you can play to your strengths -- and boost your chances of winning.

By Douglas Robson in Paris


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