Nike Memo or Debate Assignment
Use of Celebrity Athletes in Advertising
Reference chapter:
http://www.flatworldknowledge.com/pub/1.0/exploringbusiness/27989#book-28113
[Prepared by Karen Collins, author of Exploring Business]
This assignment provides you with an opportunity to strengthen your writing and/or debating
skills and form opinions on current issues affecting a major corporation.
Preparation for the Assignment
This writing assignment solicits your opinions on Nike’s use of celebrity athletes to market its
products. To complete this assignment, you should read the following (which are all attached):

The “How to Save Time When You Need to Inspire People” section of the Nike case
[from Exploring Business teaching package], “Boings and Swooshes: How Nike
Advertises.”

The following Nike press releases on the Michael Vick case:

Nike Statement on Michael Vick – October 1, 2009

Updated Nike Statement Regarding Michael Vick – August 24, 2007

Nike Statement Regarding Michael Vick - July 19, 2007

“Vick ‘Toxic’ But Eagles Sponsors Stay Put,” By Dan Gelston, August 20, 2009

“Sacked,” By Richard Tedesco, September 1, 2007
Instructions
If your instructor wants you to write a memo, you should use the attached Memo Format for this
assignment. Your memo should not exceed two pages. It should be single spaced (with a double
space between paragraphs and bulleted items).
If your instructor wants you to prepare to debate the issues, follow the steps outlined in the
attached article, “How to prepare for a debate.”
Scenario
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You just graduated from college and began your new job in marketing at Nike’s world
headquarters in Beaverton, Oregon. It was only your third day on the job, and you just ordered a
sandwich from the Boston Deli restaurant off the company cafeteria. You felt a little funny
having lunch by yourself, but you kept busy looking at the battered football helmets and
photographs of famous people that adorned the walls of the deli. As you sat down in one of the
booths with your sandwich, you looked up in amazement as Phil Knight himself asked if he
could join you for lunch. You always wanted to meet Nike’s founder and chair of its Board of
Directors, but you never thought you would be eating lunch with him on your third day at work.
Phil seemed troubled. He pointed out that Michael Vick, a former Nike celebrity athlete and
NFL quarterback who recently served jail time for dogfighting, was out of prison and would play
with the Philadelphia Eagles. When Vick pleaded guilty of the dogfighting crime in 2007, Nike
terminated his lucrative contracts. Despite the bad publicity Nike received because of its past
sponsorship of Vick, Knight wondered whether the company should be involved with Vick in the
future. He also felt obligated to defend the company’s use of celebrity athletes in its marketing
initiatives.
Knight pointed out that an important component of Nike’s marketing success in the past has been
its use of celebrity athletes in its advertising and its endorsement of team sports. He said, “Look
what Michael Jordan has done for Nike!” But, he admitted, “Things have changed. Many of
today’s professional athletes are poor role models for today’s youth. Teenagers and their parents
no longer consider many sports figures to be heroes.” He asked you (but did not really want an
answer) whether it made sense for Nike to spend millions of marketing dollars spotlighting
celebrity athletes who increasingly engage in inappropriate conduct.
When Phil learned that you were new to Nike, he decided that you might have a fresh
perspective on the issue. As the two of you continued to talk, it was decided that you would
provide your opinion and recommendations on the following issues. Phil emphasized that it was
important for you to justify your opinions and recommendations.
1. Should Nike give Michael Vick another chance and offer him a new contract? Should
the company sell products displaying Vick’s name (as Reebok is doing now)? Should the
company provide Vick with free products?
2. Should Nike shift its marketing dollars away from celebrity athletes? Why/why not? [Be
sure to discuss both the pros and cons of Nike’s marketing focus on celebrity athletes.]
3. How can Nike reduce the risks associated with signing celebrity athletes?
As Phil got up to run back to his office (leaving you with the check by the way), he told you to
be sure and give your honest opinion. Honesty and the freedom to say what you believe are a big
part of Nike’s culture.
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ATTACHMENTS
Memo Writing and Debating Materials:
How to Write a Memo
Grading sheet for memo assignment
How to prepare to debate
Nike Case Materials:
Excerpt from Nike Case “Boings and Swooshes: How Nike Advertises.”
Nike Press Releases:
October 1, 2009: Nike Statement on Michael Vick
August 24, 2004: Updated Nike Statement Regarding Michael Vick
July 19, 2007: Nike Statement Regarding Michael Vick
Articles on Michael Vick and Celebrity Sports Marketing:
Vick "Toxic" But Eagles Sponsors Stay Put
Sacked
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How to Write an Effective Memo
Memos are effective at conveying fairly detailed information. To help you understand how to
write a memo, read the following sample memorandum.
Memorandum
TO:
Introduction to Business Students
FROM: Introduction to Business Instructors
DATE: August 27, 2009
RE:
Writing Effective Memos
____________________________________________________________________________________
As college students, you’ll be expected to analyze real-world situations, research issues, form opinions, and
provide support for the conclusions that you reach. In addition to engaging in classroom discussions of
business issues, you’ll be asked to complete a number of written assignments. For these assignments, we’ll
give you a business situation and ask you to analyze the issues, form conclusions, and provide support for
your opinions.
In each assignment, you’ll use the memo format, which is the typical form of written
communication used in business. Writing in memo format means providing a complete
but concise response to the issues at hand. Good memo writing demands time and effort.
Because the business world expects you to possess this skill, we want to give you an
opportunity to learn it now.
Guidelines
Here are a few helpful hints to get you started on the right track:
The format should follow the format of this memo. Note the guide
headings—”TO,” “FROM,” “DATE,” and “RE.” [By the way, “RE” stands
for “in regards to”.] We also include a line across the page to signal the
beginning of the body of the memo.
Keep paragraphs short and to the point. The trick is being concise yet
complete—summarizing effectively. Paragraphs should be single-spaced,
flush against the left margin, and separated by a single blank line.
Accent or highlight major points. Use underlining, bullets, or bold type for
desired effect (taking care not to overdo it).
Use short headings to distinguish and highlight vital information. Headings
keep things organized, provide structure, and make for smooth reading.
Headings (and, as appropriate, subheadings) are an absolute must.
4
Your title (the “Re” line) should reflect the contents of your memo: It should
let the reader know why he or she should read it. Keep the title short—a
phrase of a few words, not a sentence.
Be persuasive and convincing in your narrative. You have limited space in
which to get your key points across. State your positions clearly. And again,
be concise (a memo is not a term paper).
If you have any additional information in the form of exhibits—charts, tables,
illustrations, and so forth—put them in an attachment. Label each item
“Exhibit 1,” “Exhibit 2,” and the like. Give each one a title, and be sure to
reference them in your narrative (“As shown in Exhibit 1, the annual growth
rate in sales has dropped from double-digit to single-digit levels”).
Finally, staple multiple pages for submission. Needless to say, be sure to
proofread for correct spelling and punctuation. Don’t scribble in changes by
hand: They’re sloppy and leave a bad impression.
Final Comment
Now that you’ve read our memo, we expect you to follow the simple guidelines presented in it.
This form of communication is widely practiced in business, so take advantage of this
opportunity to practice your memo-writing skills.
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Business 1 Memo Evaluation
[Note: I also have an excel version of this grading sheet]
I. Introduction and Conclusion (15 points)
Introduction: The writer says what he or she is going to say. The writer is specific about what will be accomplished
in the memo. It is clear who is writing to whom and why.
Conclusion: The writer provides an overall conclusion that is clearly related to the purpose of the memo and the
prior evidence in the memo. The conclusion pulls together the main points without simply repeating them.
Points earned: __________________
__________________________________________________________________________________
II. Flow and Structure (15 points)
Flow: Writer connects points so there is a clear flow from one idea to the next.
Structure: The main idea in each section is clear and focused. Introductory sentences and/or headings are clear and
precise and indicate to the reader the main point of that paragraph, section, or list of bulleted items.
Points earned: ___________________
____________________________________________________________________________________
III. Substance, Support and Application of research (25 points)
Substance: The writer does what he or she said would be done in the introduction.
Support: Opinions and conclusions are supported. Specific examples are used to support the main points. The
relevance of the examples to the main points is clear.
Application of research: The research is used to support what the writer wants to say. Statements are accurate.
Points earned: _____________________
_____________________________________________________________________________________
IV. Mechanics and Style (15 points)
Tone and style: The memo reflects the appropriate level of formality. The writer demonstrates clear sentence
structure and word choice for the intended audience. The memo reads like a memo.
Grammar and spelling: The memo is free from errors in grammar, spelling and mechanics. Memo is proofread.
Points earned: ________________________
____________________________________________________________________________________
V.
Overall (30 points)
Reasoning: The memo makes sense. Reasoning is sound. The logic is clear. Thoughts are well organized.
Conclusions reached are valid.
Readability: The memo is interesting, engaging, informative and a pleasure to read. It provides valuable information
to the reader.
Points earned: _________________________
TOTAL POINTS EARNED: _________________
GRADE: ________________%
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How to prepare for a debate
How To Do Just About Everything
User-Submitted Article by 02SmithA
http://www.ehow.com/how_4490531_prepare-debate.html
It's not just Presidential candidates that need to know how to debate
Chances are at some time in your life you have had a debate. It may have been at school or work
or even at home. Were you prepared for the debate? Here are some steps to take to prepare
yourself better for your next debate.
1. Step 1
The number one key to preparing for a debate is putting the time into researching your
side of the argument. Having an opinion isn't enough to be effective in a debate. You
need to be able to have strong supporting materials for your side of the debate.
2. Step 2
Make sure you include relevant facts that many others would not have already known.
People want to hear facts that they didn't already know. The more related relevant facts
you include the stronger your presentation becomes.
3. Step 3
Learn how to effectively communicate your positions. You may have a great position on
a certain subject, but if you can't effectively communicate that to an audience it won't
matter in a debate. Practice in front of others and even in front of a mirror. Make sure you
look confident because no one will buy an argument from someone who isn't confident
themselves.
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4. Step 4
Train yourself to fully respect the other debater. Nothing turns someone off more than a
debater who just won't allow the other person to get in a word. Even if you are
completely convinced you are right, you must give the other person time to speak their
mind as well.
5. Step 5
Prepare to have a rebuttal to the arguments that the other person will make. Many times
you can know what they will say ahead of time and prepare yourself with facts that
contradict their argument.
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EXCERPT FROM NIKE CASE
“BOINGS AND SWOOSHES: HOW NIKE ADVERTISES”
How to Save Time When You Need to Inspire People
As most of us know, Nike ultimately regained its dominance in the industry, and as anyone with access to a TV or a
map to the mall knows, better marketing had a lot to do with the company’s resurgence. Perhaps the most visible
component of Nike’s marketing strategy is the parade of sports world celebrities who endorse its products,
beginning with Steve Prefontaine, a former middle-distance runner of Bill Bowerman’s. Why was it so important to
sign up celebrity endorsers like Michael Jordan, who became a “Nike guy” in 1984? “It saves us a lot of time,” says
Knight:
Sports is at the heart of American culture, so a lot of emotion already exists around it. Emotions are always hard to
explain, but there’s something inspirational about watching athletes push the limits of performance. You can't
explain much in 60 seconds, but when you show Michael Jordan, you don't have to.
It’s called sports marketing, and it has, of course, evolved over the years. Traditionally, it reflected a pretty basic if
they see ’em then sign ’em mentality. For advertisers, the idea was to get the client’s product on the most visible and
highly exposed athletes, and that strategy didn’t require a lot of consultation with other people at the client company.
The purpose of the approach is fourfold:
1. Because professionals are wearing the products, their professional quality is “authenticated.”
2. Whenever the athlete’s picture is taken or the athlete appears on TV, the company gets free publicity.
3. Because athletes are able to do “special” things, there is an implicit connection between what they do and
what they wear while doing it.
4. The company receives valuable feedback on product innovations from world-class athletes who wear and
test its products.
Today, sports marketing is much more fully integrated into the overall business activities of most companies,
especially at Nike. Now when Nike considers signing a celebrity athlete, it considers all aspects of its business, from
footwear and apparel, to advertising and public relations. The final decision still rests with its sports marketers, but
no athlete is signed until various division heads have been asked an array of business oriented questions: What
would you do if we had this athlete? Would this athlete inspire your division to build a new product? Could you
design an effective advertising campaign around this athlete? Would this athlete be a good spokesperson for Nike?
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NIKE PRESS RELEASES ON MICHAEL VICK
[Nikebiz.com web site, media section]
October 1, 2009 -- Nike Statement on Michael Vick
Beaverton, Oregon -- Nike does not have a contractual relationship with Michael Vick. We have
agreed to supply product to Michael Vick as we do a number of athletes who are not under
contract with Nike.
August 24, 2007 -- Updated Nike Statement Regarding Michael Vick
Beaverton, Oregon – Nike has terminated our contract with Michael Vick following today’s
release of details of his plea. As we have said in previous statements, we consider any cruelty to
animals inhumane, abhorrent and unacceptable.
July 19, 2007 -- Nike Statement Regarding Michael Vick
Beaverton, Oregon -- Nike is concerned by the serious and highly disturbing allegations made
against Michael Vick and we consider any cruelty to animals inhumane and abhorrent. We do
believe that Michael Vick should be afforded the same due process as any citizen, therefore, we
have not terminated our relationship. We have however made the decision to suspend the release
of the Zoom Vick V and related marketing communications. Nike will continue to monitor the
situation closely and have no further comment at this time.
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Vick "Toxic" But Eagles Sponsors Stay Put
By DAN GELSTON
Updated 12:45 PM EDT, Thu, Aug 20, 2009 – NBC Philadelphia.com
[http://www.nbcphiladelphia.com/news/sports/Vick-Toxic-But-Eagles-Sponsors-Stay-Put53810882.html]
Getty Images
The Philadelphia Eagles' sponsors are standing by their team. That doesn't mean anyone
is ready to put extra money in Michael Vick's pockets.
The Eagles had prepared for a backlash after signing the convicted dogfighting ringleader
last week. But while Vick is disgraced in the court of public opinion -- the one that drives
lucrative endorsement deals -- his addition has not jeopardized the team's corporate support.
None of the more than four dozen Eagles sponsors had pulled out as of Wednesday, said Marlyse
Fant, Eagles vice president of sales and service.
The Eagles heard from about 15 to 20 sponsors on Friday, a day after Vick signed, but
most simply wished that they were given advance notice to pass on to their customers.
"Our clients have been in close contact with us to stay up to date on information coming from the
team, and most have noticed a significant reduction in their own volume of customer inquiries
since Friday," she said on Wednesday.
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The Eagles took a proactive approach, sending a letter to their top customers last week
asking them to have faith that the team was not acting recklessly.
"We appreciate the complexity this creates for some partners and premium clients and ask that
you join us in our support and optimism for Michael as he commits himself to showing
Philadelphia and the country he is a changed human being," team president Joe Banner wrote in
the letter.
Reaction from Eagles sponsors has varied. Radio rights holder 94-WYSP said it has had
"little to no reaction" from the station's sponsors. PepsiCo Inc. said in a statement that Vick's
illegal activities were "cruel and degrading" but backed the team. "As sponsors of the NFL, we
have the utmost confidence that the senior leadership at the NFL will continue to appropriately
address this issue," Pepsi said.
Sponsors understood the move from a football standpoint.
They do not hold the same view of Vick. The brutal nature of his crimes -- which included
electrocuting, drowning and hanging dogs that underperformed in fights -- are not going to fade
quickly from the public's memory.
"He's too toxic for most companies to even consider taking a chance on him," said David
Carter, who specializes in sports business and marketing as executive director of the USC Sports
Business Institute.
Once a $130 million player, Vick was a corporate America favorite as the star
quarterback of the Atlanta Falcons. His image was used to market everything from sneakers to
sports drinks, usually aimed at the coveted 18 to 34 male demographic.
The Falcons paid Vick $23 million in 2005 and Forbes estimated his total compensation that year
at $37.5 million with endorsements.
Only 26 and at the pinnacle of his career, Vick's life and marketability imploded amid the
graphic details of a dogfighting operation he helped bankroll and participated in.
One of his most lucrative deals was with Nike, which signed him as a rookie in 2001 but
terminated his contract after he pleaded guilty in federal court in August 2007, ultimately serving
18 months in prison.
Nike offered only a terse comment on Vick this week. "Michael Vick does not have a
contractual relationship with Nike. We will have no further comments at this time," the company
said through spokesman Derek Kent.
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Given the cruelty inherent in dogfighting, and the general public's emotional attachment
to pets, endorsements for Vick are almost unimaginable at this point.
Vick isn't being completely ignored, simply because he's back in the NFL. He was on the cover
of the Madden NFL 2004 video game and was not included this year only because it was
completed before NFL Commissioner Roger Goodell conditionally lifted Vick's suspension.
EA Sports made Vick available as part of a roster update on Wednesday.
"We're not judge and jury," EA Tiburon spokesman Rob Semsey said. "If he's approved by the
NFL to come back and be signed by a team, he's just like any other player. We make sure our
game is as authentic as possible. Adding Vick was a no-brainer."
Vick's replica Eagles jersey, which retails for $79.99, was the top seller on NFLShop.com as of
Wednesday. Jersey maker Reebok did not return calls for comment.
But Dick's Sporting Goods, a Pennsylvania-based company, said Wednesday it is not currently
selling Vick's jersey in any of its stores.
"It is strictly a business decision, not at all a political statement of any kind. We are only
in the business of meeting the needs of our customers," Dick's chief marketing officer Jeff
Hennion said. "I personally have not heard any retailers with stores in the Philadelphia area
talking up the demand for the jersey."
It's not inconceivable that Vick could one day return as a pitchman, but Carter said Vick
first needs to rehabilitate his image. He must follow through on promises to get involved in
animal rights' work and the public must believe he is genuine.
"It's going to be a nontraditional type company, one that doesn't mind the controversy,"
Carter said. "They would enjoy the notoriety and buzz created by signing him. You might see an
upstart, maybe an apparel manufacturer with a real edge. But edgy and animal cruelty don't go
together. It's going to have to be one whose targeted consumers are more interested in his athletic
appeal than his overall body of work."
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SACKED
September 1, 2007, by Richard Tedesco
Promo [http://promomagazine.com/eventmarketing/marketing_sacked/]
Celebrity athletes have taken some serious hits lately, getting caught in any number of
unflattering situations. And marketers who've chosen them as sponsors are scrambling to
minimize the fallout.
-----------------------------------------------
It's been a tough season: Atlanta Falcons quarterback Michael Vick went to the dogs. San
Francisco Giants left fielder Barry Bonds set the all-time home run record under a steroid cloud.
And several Tour de France competitors were again accused of doping.
When Vick was indicted on charges of being involved in dogfighting, he crossed one of
those inviolable lines that even ardent football fans have difficulty fathoming. Advertisers
reflected the public outcry about Vick's perceived outrage, with Nike, Reebok and Rawlings
quickly suspending their respective associations with the football star.
Vick's deals with the three companies were estimated to be worth $7 million annually.
Nike's was the biggest.
Vick also had a deal with Upper Deck, which pulled his memorabilia and cards from its
Web site.
In the high-stakes game of athlete sponsorships, marketers roll the dice on every deal. So
it's vital for them to chart a ready exit strategy in case some kind of personal scandal threatens to
blacken the brand's public image by association.
Nike killed a multimillion-dollar ad campaign to promote Vick's new signature shoe,
postponed production and suspended him without pay. Reebok pulled Vick's jersey from
retailers. None of them ditched Vick permanently, but that situation was subject to change at
press time after the quarterback entered a guilty plea.
If Vick does play pro football again, most observers agree that short of a character
transplant, he won't have a commercial comeback in his playbook. “I think he's going to
disappear,” says Jeff Bliss, president of Javelin Group, a sports marketing company. “He did
something reprehensible. There are billions of people who have pets and they see dogs as
childlike.”
Vick stands in a long line of marketable sports celebrities who went south, like O.J.
Simpson, who once sprinted through airports for Hertz before he stood accused of killing his
wife, and Mike Tyson, who drank Diet Pepsi in a TV ad with then-wife Robin Givens before he
went to jail for rape and then chewed on Evander Holyfield's ear. But sports endorsements
remain a vibrant market.
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Nike alone spends $1.9 billion on advertising and promotion every year.
At the top of their games, New York Yankees shortstop Derek Jeter currently draws $7
million in annual endorsements and teammate Alex Rodriguez earns $6 million.
The overall sports sponsorship market is projected to hit $9.9 billion this year, a 10.8%
jump over 2006, according to sponsorship research firm IEG.
REDUCING THE RISKS
Many advertisers court risk in relationships with athletes to distinguish themselves in the
media despite the obvious dangers. “Some people recognize that controversy creates a louder
story quicker than a sustained effort at being a good guy,” says Phil de Picciotto, president,
athletes and personalities at Octagon, a sports and entertainment consultancy.
While he hasn't seen any general disinclination among clients to involve star athletes in
marketing campaigns, de Picciotto believes there's an acute sense of caution in the air. Octagon
is being consulted much earlier in the planning process to offer its opinions about the potential
risks of athletes being considered for a particular campaign.
The typical modus operandi of prospective sponsors also has changed. “Companies tend
to be focused on the short term,” de Picciotto says. “They want to be able to exit a relationship
that's gone awry and they want shorter-term relationships.”
But a crucial element is the research needed to detect pitfalls before signing an athlete.
“The agencies need to speak to people in the industry and get a 360-degree view so they have a
better sense of the individual and have a crisis plan in place,” says Javelin's Bliss.
Javelin recommends a multiple-athlete approach to its clients, according to Bliss, who
points to Gillette's current deals with golfer Tiger Woods, tennis star Roger Federer and French
soccer standout Thierry Henry. “Companies need to look at this as a strategic, not a tactical
move,” he says.
Detailed background checks on athletes being considered for lush deals are a necessary
pre-emptive measure, according to consultants. Javelin pushes agencies to conduct “much more
thorough” investigations that are “not just criminal but personal checks,” Bliss notes.
And companies are carefully scrutinizing morals clauses included in their agreements
these days. William Heberer, a partner in the law firm Manatt, Phelps & Phillips, says the nature
of the clauses varies from broad behavioral bailout language to very specific parameters,
depending on the leverage of the parties involved. But there's no question about the purpose.
“It's a big loophole or a big hammer the sponsor holds over the athlete to end the
relationship,” he says. “If [the athlete's] association with the brand is no longer a positive one,
the brand is going to want an exit.”
Morals clauses are already one of the most contentious negotiation points in athlete
sponsorships deals, and Heberer says that will only intensify in the post-Vick era: “You are
15
certainly seeing companies looking at these provisions much more closely and being more
rigorous in their standards. Athletes are likely to find sponsors tougher with these standards
going forward.”
But consultants say they don't detect any real reluctance among clients to sign athletes for
sponsorships, and they don't anticipate anti-athlete angst to prompt sudden tactical shifts.
“I don't think much changes. For generations there have been athletes getting in the
headlines,” says David Grant, a principal at Velocity Sports and Entertainment. “We don't see
people shying away from the NFL because of the behavior of a few bad apples.”
Marketing consultants say they're persistently advising clients to spread their risk with
multiple sponsorship deals.
Velocity designed a program for FedEx aimed at avoiding sponsorship problems which
eliminated protracted associations with individual athletes. For the past several seasons, FedEx
Air and Ground has tied its core business to the outstanding weekly performances of NFL
players, who are selected by fan vote online.
“We've really minimized the risk because we're linking to the athletes for this particular
week,” Grant says. “If someone's in trouble, they're probably not on the field.”
An athlete's character has become an important aspect of the equation, he adds. Narrowly
targeted campaigns attempt to match brand attributes with the player.
Most experts concur that in the prevailing glare of the paparazzi environment, high media
profiles fueled by stratospheric salaries make athletes targets of intense public scrutiny for both
their on-field performance and off-field peccadilloes.
“There are degrees of bad-boy imagery,” says consultant Bob Cramer. “Something like
riding motorcycles is one thing. Something that's immoral is another thing.”
A murder accusation crosses that line, as the case of Baltimore Ravens linebacker Ray
Lewis demonstrated several years ago. Lewis pled guilty to a misdemeanor in the doublehomicide case. But his sponsors summarily dropped him and he was conspicuously absent from
the Wheaties box that featured a group of his Ravens teammates after their Super Bowl triumph.
THE BONDS BROUHAHA
As a marketing executive for MasterCard, Cramer pulled the plug on sponsorship
negotiations with Barry Bonds two years ago when it became clear that the slugger would be
mired in baseball's growing steroid scandal for a long time.
Some things clearly are forgivable in the realm of public opinion, and others are not, with
star athletes regularly putting themselves in crises that can put the kibosh on a marketing deal
with the suddenness of a slam dunk.
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“You can do whatever you want and come back and do pretty well,” Javelin's Bliss says.
“But when it comes to cheating, that's a whole different thing.”
As the Vick case unfolded, Bonds set the landmark home run record that might have
elevated him to near-mythical stature. While ESPN hyped the impending milestone, one primary
Major League Baseball sponsor — Bank of America — refused to participate in promotional
plans involving the record.
Just five years ago Bonds made the Wheaties boxes as National League home run
champion. But he won't be seen on cereal boxes anytime soon.
“If everything was clean and pure, this would have been one of the biggest marketing
bonanzas we've ever seen,” says Cramer. “He may get the benefit of the doubt over time, but it
doesn't erase his abrasive personality.”
Last year, Bonds reportedly made $2 million in endorsement fees on top of his $15.8
million salary. Shattering the single-season home-run record in 2001 spawned short-term deals
with KFC parent Yums Brands and discount brokerage Charles Schwab. But since 1999 he's
made only two notable endorsements, for Fila's spikes and Franklin Sports' batting gloves.
CUTTING LOSSES
Meanwhile, the NFL is set to kick off its annual player-image campaign, featuring five
socially conscious players yet to be named. “Often the media will focus on a couple of players,”
says NFL spokesman Brian McCarthy. “Collectively, we're focusing on a lot of players working
with kids or visiting the military.”
And as one star fades, others begin to glow. Nike's “Quick Is Deadly” campaign for its
new Zoom running shoe includes a striking TV spot featuring San Diego Chargers running back
LaDainian Tomlinson. Tomlinson is a compelling figure for sponsors, not only for the
athleticism depicted in the Nike ad, but for his image as a young athlete who's active in his
community.
The Vick debacle won't turn off the NFL faithful or the advertisers who seek their favor.
But baseball's steroid scandal, with Bonds as its all-too-public poster boy, may be having
a dampening effect on sponsor interest. “If you're really conscious and concerned about it, you
stay away from baseball personalities right now,” says Marketing Evaluations' executive vice
president Henry Schafer.
Schafer feels unpredictable shifts in the public's perception of an athlete is a mercurial
element in the mix: “The risk you run when you connect yourself with a high-profile personality
is how that personality is trending over time.”
Several publicly chastened athletes have managed to keep sponsorship deals and recoup
their public images in recent years. Nike stood by Los Angeles Lakers guard Kobe Bryant after
he was accused of rape — Coca-Cola didn't — and his jersey remained among the top sellers of
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NBA stars. Nike also kept its links with Lance Armstrong in the wake of doping accusations
after his Tour de France triumphs.
Nike declines to discuss what standards it applies to its athlete endorsements. “We really
don't discuss how we determine which athletes we work with,” says Nike spokesman Brian
Facchini.
Some sports personalities have a commercial endurance based on a charisma that
transcends their personal shortcomings. Despite media reports alleging his predilection for
gambling, retired NBA star Michael Jordan remains the most popular American sports figure,
ahead of Tiger Woods, according to Marketing Evaluations research.
Schafer points to another former NBA great, Magic Johnson, as the prime example of an
athlete who turned his HIV-positive predicament into a public relations coup through the electric
appeal of his affable personality.
Some observers think on-field performance trumps character in most fans' perceptions. “I
don't believe that the character card plays as well as one might think,” says marketing consultant
Richard Laermer.
On-field performance may impress the purist fan, but companies often seek personalities
who spawn their own off-field hype as well. Observers point to former NBA forward Dennis
Rodman, who played with unbounded intensity on and off the court.
“Being famous is about being memorable,” says Laermer. “I think they're looking for
characters. Buzz is about who talks about who.”
And buzz clearly sells. So it's probably not surprising that Kobe Bryant's jersey was the
top seller among NBA player jerseys last season, and bad boy Allen Iverson's was fourth best.
The act of burnishing a company's public façade with an athlete's face requires strategic
forethought. “It all has to start with the company and the brand and what you're trying to
accomplish,” Cramer says. “The whole idea of sponsorships is to latch onto a large, passionate
consumer base.”
Striking that passionate chord through links to a colorful sports celebrity holds endless
appeal for sponsors, until there's a disconnect between the athlete's radiant public persona and a
darker side that unexpectedly emerges.
“The private person can be very different from the public persona as long as the private
one doesn't become public,” says Javelin's Bliss.
With the media in pursuit, companies need recourse to a set of option plays any heady
quarterback would call under pressure.
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THE BUZZ ABOUT BECKHAM
British soccer star David Beckham personifies the yin and yang in sponsorship risk
factors. He's a sports celebrity with lots of glitz, despite questions about how much game he's
still got.
Hailed as the latest savior of professional soccer in America, Beckham signed his 10year, $250 million contract with the Los Angeles Galaxy on the downside of a career that saw
him riding the bench through much of the last two seasons with Real Madrid. Incentives tied to
broadcast rights and ticket sales could boost that figure considerably.
“The Beckham case is unique in that the $250 million is partly for his soccer skills, but
it's also for his off-the-pitch marketability,” comments Eelco van der Noll, senior vice president
for event sponsorships and marketing at promotions agency Momentum Worldwide and the
former head of marketing at FIFA, the international soccer organization. “If he were to fail on
the pitch, he would undermine his own credibility.”
But Beckham's already proven he's an impact player here off the field: The Galaxy sold
250,000 David Beckham jerseys before he ever struck one of his signature free kicks. That
covers the $5.5 million base salary the lackluster team is paying him to play this season.
Beckham is known by two-thirds of American sports fans, but only 14% say they like
him, according to Marketing Evaluations research. “It's just not a situation where he's got a high
level of likability,” says executive vice president Henry Schafer. “He's got to earn that, to show
he can still play and help turn the franchise around.”
Few sports fans in this country have seen many of Beckham's matches in his storied
career, but they know about him and his celebrity wife, the former Posh Spice.
But their interest won't be sustained by glitz alone. If Beckham can't bend his shots past
goalkeepers as consistently as he used to, he could become a commercial Kohoutek for sponsors
along for the ride.
Marketing consultant Richard Laermer puts it this way: “If he doesn't do really well on
the field, he's going to be the biggest flame-out in sports history.”
— Richard Tedesco
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