Visionary Agent’s Sports Stars Scored

Mark H. McCormack, the lawyer and marketing genius who transformed the landscape of professional sports by pioneering lucrative endorsement contracts for major athletes and events, died Friday in a New York City hospital of complications from a heart attack. He was 72.

One of the most powerful executives in sports, McCormack was founder, chairman and chief executive of Cleveland-based International Management Group, a full-service agency that handles the business affairs of some of the world’s most celebrated athletes, entertainers and other public figures. He had been hospitalized in a coma since Jan. 16, when he suffered the heart attack.

A prolific writer, nonstop globe-trotter and avid golfer, McCormack’s rise in the sporting world began 43 years ago, when he reached a deal to represent golfer Arnold Palmer. Their contract was, for a time, a firm handshake, and McCormack immediately set out to prove his belief that corporations would pay enormous sums for celebrity athletes to endorse their products.

He was hugely successful from the start, increasing Palmer’s income by hundreds of thousands of dollars within the first two years of their business arrangement.

“I have lost one of my closest friends,” Palmer said Friday in a statement. “And the world of sports and entertainment has lost one of its great giants.”

McCormack was one of the first to merge the rapidly growing television industry with the sports world, enhancing the marquee value of specific athletes as well as the names of such historic sporting events as Wimbledon and the British Open. He was gifted at creating made-for-television sporting events ranging from the Skins Game, a top-name golf competition, to the American Gladiators, the highly stylized physical competition between fairly average contestants and not-so average “gladiators.”

“He [was] a guy who changed the way Americans think about the business of sports,” said Rick Burton, director of the Warsaw Sports Marketing Center at the University of Oregon. “He changed the athlete/agent landscape more dramatically than anyone.”

McCormack had an eye for talent -- in sports and in business. He recruited Hughes Norton out of Harvard Business School and made him his assistant at IMG. Norton, who was golfer Tiger Woods’ first agent, is now a consultant to IMG after 28 years at the company and says McCormack’s instincts about the business side of sports were unrivaled.

“He realized that athletes retired and athletes go into slumps and athletes get injured, so he went beyond representing the athletes and began representing the sports entities,” Norton said. “In other words, Bjorn Borg might retire at 26, but Wimbledon goes on. Arnold Palmer might go into a slump, but the British Open goes on forever.”

“That’s the biggest and brightest example of his genius.”

McCormack stepped in and forged landmark deals with both Wimbledon and the British Open, covering worldwide television rights, marketing and merchandise.

“He convinced Wimbledon he needed to represent the All England Club in selling its television rights, to make use of his tennis expertise and television contacts,” Norton said.

McCormack’s leverage helped Wimbledon sell its U.S. television rights for up to $20 million and worldwide, as much as $50 million. Both properties had been worth only a fraction of that before McCormack took charge.

In addition, McCormack advised both Wimbledon and the British Open to come up with a marketing logo and use it to sell merchandise. He also insisted that Wimbledon television coverage provide a commercial spot for merchandise as part of the television rights deal, at no cost to the All England Club.

“Nobody ever thought of that before,” Norton said.

And McCormack was responsible for turning dozens of athletes, along with himself, into some of the richest and most influential figures in the world. With a net worth estimated at $700 million, McCormack was a regular on the annual Forbes magazine list of wealthiest people.

Woods might be his most famous client -- and his richest .

In 1997, when Woods was 21 and won his third consecutive U.S. Amateur Championship, Norton negotiated an unheard-of $45-million endorsement deal for the golfer with Nike. In 2003, it’s a package worth at least $90 million, according to estimates, and Woods’ entire endorsement portfolio, under the guidance of agent Mark Steinberg, carries a value of close to $120 million.

Woods’ prize money on the PGA Tour is a fraction of that -- $6.9 million in 2002.

McCormack “was a genius when it came to sports marketing.... If it wasn’t for him, obviously, we wouldn’t be in the position we’re in right now,” Woods said from Gut Kaden, Germany, were he was playing in the Tour Players Championship.

Before McCormack, athletes had little opportunity to earn money outside their sport. Some were asked to hold a pack of cigarettes for a print ad or sit atop a John Deere for an early television commercial, but there were no middlemen to take care of negotiating or offer prudent advice.

“He [knew] how to connect the image of an athlete with the image of a company and have them affect each other from a positive perspective,” said Dean Bonham, a Denver-based sports marketing consultant. “It’s hard to believe, but before Mark McCormack, [people in the industry] didn’t understand how to do it at a level he [knew] how to do it.”

Sports Illustrated named McCormack the most powerful man in sports in 1993, and the London Times called him one of the 1,000 people who most influenced the 20th century. Tennis magazine and Golf magazine have both selected him as the most influential person in their respective sports. Though McCormack built his niche in golf and tennis, he gradually broadened IMG to include more than country club clients. As recently as last summer, IMG took on the task of running the U.S. Open of Surfing in Huntington Beach.

Clients Include Vatican

His company’s list has grown to include golfer David Duval, New York Yankee shortstop Derek Jeter, tennis stars Venus and Serena Williams and Andre Agassi. Non-sports figures include actresses Elizabeth Hurley and Liv Tyler as well as violinist Itzhak Perlman and soprano Kiri Te Kanawa. The firm has also represented such institutional clients as the Vatican, the Nobel Prize and Oxford University.

McCormack never relinquished 100% ownership of IMG and scoffed at the thought of retiring. “People say, ‘Why don’t you retire?’ ” McCormack told the London Times last summer. “I say, ‘Because I get to play golf with Arnold Palmer and Tiger Woods, tennis with Monica Seles and I get to go to Wimbledon and Paul McCartney’s wedding.’ My God, it’s terrific.”

Mark Hume McCormack was born in Chicago on Nov. 6, 1930, the son of a publisher of farm journals and magazines. At the age of 6, he was hit by a car and suffered a fractured skull, ending his hope of playing contact sports. His father, Ned, didn’t let the injury keep his son inactive, however, instead introducing him to golf.

McCormack became a steady player, winning the Chicago high school championship and later becoming the top player at the College of William & Mary in Virginia. In 1951, his team played Wake Forest, whose top player was Palmer, a little-known long hitter from Pennsylvania.

McCormack went on to graduate from Yale Law School, spent two years in the Army and began practicing law in 1954. After a few years, McCormack found the work tedious and turned his attention back to golf.

McCormack, who headed his own Cleveland-based law firm at the time, moonlighted as a tournament organizer and part-time professional golfer.

While rubbing elbows with the full-time professionals, he often heard them complain about the money they were earning. He formed a company with an agent, Dick Taylor, and they began booking additional appearances and exhibitions for the players, and soon, knowing McCormack was also a lawyer, they began asking him to comb over their contracts with clothing and equipment companies.

Soon after, McCormack approached Palmer during a friendly round of golf and asked to be his exclusive representative. Palmer, who had just won his first Masters and was just beginning to build his legendary career, didn’t give McCormack an immediate answer, instead inviting him to spend the night at his nearby home. During the evening, McCormack noticed stacks of unopened mail and other paperwork piling up on Palmer’s desk, so he stayed up late organizing the mess.

When Palmer saw his desk the next morning, he agreed to let McCormack be his agent. McCormack offered to draw up the contract, but Palmer simply stuck out his arm and sealed the deal with a handshake.

40-Year Handshake Deal

“For well over 40 years, Mark McCormack and I had an unwritten bond that meant a great deal to both of us, in both our business and personal lives,” Palmer said in his statement. “I never had a moment’s regret or misgiving about placing much of the guidance of my future in his hands and it certainly proved to be the right thing for both of us.”

In his first two years with McCormack, Palmer’s annual earnings skyrocketed from $60,000 to $500,000, a majority coming from the sales of his name-brand equipment and apparel. Palmer also became a regular fixture on television and radio, his name appearing in nearly every newspaper and golf magazine.

Palmer quickly purchased a golf course design company, a chain of dry cleaning stores, an insurance company and his own jet. In 1994, more than 20 years after he had won his last tournament, Palmer was still earning $13.6 million in product endorsements, slightly more than another IMG client, hockey great Wayne Gretzky, earned during the same year, when he led the National Hockey League in points and assists as a member of the Los Angeles Kings.

McCormack’s second and third clients were also household names in golf, American Jack Nicklaus and South African Gary Player. The partnerships couldn’t have come at a better time for McCormack. The three golfers won every Masters tournament from 1960 to 1966, a time when the sport was enjoying increased television coverage. At the same time, legal representation was still virtually unheard of in professional sports.

As IMG diversified into other sports in the mid-1960s, it continued to take advantage of the growing influence of television on professional sports worldwide. McCormack’s strategy was to sign the best athlete in each country, then use that athlete to open up corporate doors in his or her own homeland.

The representation of Australian Rod Laver in 1968 marked IMG’s debut in tennis; Frenchman Jean-Claude Killy was the cornerstone of its involvement in skiing and winter sports; and Scottish race car driver Jackie Stewart led IMG into the world of motor sports.

Originally dedicated to athletes from individual sports, McCormack’s firm began representing athletes from team sports in the late 1960s.

McCormack helped negotiate the $3.84-million contract package for Larry Csonka, Jim Kiick and Paul Warfield, members of the Super Bowl champion Miami Dolphins who in 1974 signed with the Toronto Northmen of the short-lived World Football League. At the time, their contract was the largest in professional sports.

By 1976, McCormack’s clients had expanded outside of sports to include the top 15 executives of Rockwell International, hairdresser Vidal Sassoon and model Jean Shrimpton.

McCormack’s services did not come cheaply. Celebrities pay up to a quarter of their commercial endorsements as fees to IMG.

Taking a 25% Cut

“Twenty-five percent is very high,” Bonham said. “It’s much less on an industrywide basis, 5% to 7% for individual representation and around 15% to 20% for sponsorship deals.”

But McCormack did not welcome every athlete aboard. He turned down opportunities to manage golfer Billy Casper and a young boxer named Cassius Clay, who later won worldwide fame after changing his name to Muhammad Ali.

He refused to take Casper because he thought his pudgy physique made him less marketable. He initially didn’t represent Clay because he was not interested in boxing, believing there was a “criminal element” associated with the sport.

Several athletes departed from IMG because they felt McCormack wasn’t earning his 25%. Nicklaus left IMG in 1971 and formed his own company, Golden Bear, which helped make him one of the world’s richest athletes. Other golfers who took their business elsewhere included Greg Norman, Nick Price and Nick Faldo. McCormack wasn’t shy about pointing out that none played at the level they did while IMG clients.

Other setbacks included the 1988 Seoul Olympics, when the IMG-negotiated television rights sold for far less than he originally predicted and asked for, partly because the main events were held at an inconvenient time for U.S. audiences. That may have led to organizers of the 1992 Barcelona Olympics not retaining IMG’s services.

But McCormack didn’t let any of those setbacks stop him from pursuing additional interests abroad, including television production operations in India, the establishment of a professional basketball league in China and developing more than 280 redesigned golf courses around the world.

All of those ventures made McCormack a prolific traveler, logging up to 200,000 miles a year, nearly all on commercial airlines. He kept busy during his travel by writing books, many on business management, including “What They Don’t Teach You at Harvard Business School,” which spent 21 weeks on the New York Times bestseller list in 1984.

McCormack is survived by his second wife, Betsy Nagelsen, a former professional tennis player and television commentator, whom he married in 1986. They have a 5-year-old daughter, Maggie. McCormack is also survived by three children from a previous marriage, Breck, Todd and Leslie.

A private burial will be held in his hometown of Chicago, followed by a memorial in New York on May 21.

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Times staff writer Thomas Bonk contributed to this report.