“I am the bullet in the chamber” read the slogan for Nike’s advertising campaign featuring Oscar Pistorius. The advert was pulled the day after the Paralympic athlete was arrested and charged for the murder of his girlfriend, Reeva Steenkamp.
Nike’s quick response highlights howcompanies tend to protect their brand rather than defend the athletes they endorse. Bound by contracts, athletes are expected to remain loyal to their sponsors, but the sponsors are not always ready to remain loyal to their athletes.
Pistorius’s advertising campaign for television channel M-Net was immediately withdrawn on 14 February, the day of his arrest. Billboards located on Rivonia Road in Sandton were taken down the same day.
Last week Tuesday, the day Pistorius appeared in court to apply for bail, Nike and Oakley formally severed ties with him. “In light of recent allegations, Oakley is suspending its contract with Oscar Pistorius, effective immediately. Our hearts are with the families during this difficult time,” Oakley said in a statement. Thierry Mugler has also terminated his contract.
Industry experts have warned Pistorius’s other sponsors and Ossur (the company that produces the carbon-fibre prosthetics Pistorius uses) to disassociate themselves from the athlete quickly.
According to John Taylor, director of a sports management company, Pistorius “is damaged goods, even if he is found innocent.” Taylor told the BBC that “brands need to act quickly and distance themselves from him. It’s not like rats deserting a sinking ship. It’s just the sensible thing to do.”
Nigel Currie, director of sports marketing agency Brand Rapport, noted that the nature of the situation is in itself damaging to the brands Pistorius endorses. “This is very different to the Tiger Woods and Lance Armstrong cases. This is life and death. There’s no coming back from this,” Currie told the BBC.
Nike has had to deal with controversy regarding athletes it sponsors before. Usually, the company is loyal to their athletes. According to Bob Dorfman, editor of The Sports Marketers’ Scouting Report, “It takes pretty damning evidence for them to drop anybody. They’re about the most faithful company that you can think of.”
In 2003, Nike stood by basketball star Kobe Bryant when he faced charges of sexual assault. The woman who accused him later dropped the charges.
Nike continued its support of golfer Tiger Woods after he admitted to cheating on his wife with at least a dozen women. Woods’s contracts with Accenture, AT&T, Gatorade and General Motors were all terminated after he confessed to infidelity in December 2009. Gillette and TAG Heuer suspended advertising with Woods while Nike and Electronic Arts were the only brands that continued to use him in campaigns.
More recently, Nike cancelled its endorsement of Lance Armstrong after it became evident that the cyclist had used performance-enhancing drugs for most of his professional career.
Nike initially stood by Armstrong, but ended sponsorship after USADA (the United States Anti-Doping Association) released a report detailing the allegations against him. Even though Armstrong was still protesting his innocence when this information was published, Nike issued a statement last year October which asserted that Armstrong had “misled” the company. “Nike does not condone the use of any illegal performance-enhancing drugs in any manner,” the statement continued.
Sport marketing is a lucrative business. Nike has committed to paying $3.2 billion in sponsorships to athletes in the next five years, according to a CNNMoney article. Sport Illustrated reported that Armstrong earned $17.5 million from sponsors in 2005, the year in which he won his seventh consecutive Tour de France.
The sport marketing industry is successful because athletes remain loyal to the brand they endorse and fans remain loyal to the athlete and teams they support.
A recent University of Florida study found that sponsors are more loyal to athletes with positive images. Sponsorship must enhance brand’s reputation, so a controversial athlete is not worth endorsing.
The study concluded that being trustworthy and being a good role model are essential factors in determining whether a brand will remain loyal to an athlete. Once athletes lose their credibility, the viability of endorsing them diminishes dramatically.