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Cos. walk a tricky line with endorsements

October 19, 2012 • Business


FILE – In this March 15, 2011 photo, a customer ties a Nike’s Livestrong shoe, which supports the Lance Armstrong Foundation, at a shoe store in San Francisco. Nike forgave a contrite Tiger Woods after his infidelity was exposed. It welcomed back an apologetic Michael Vick once he served time for illegal dog-fighting. But the company dropped Lance Armstrong, Wednesday, Oct. 17, 2012, faster than the famed cycler could do a lap around the block. (AP Photo)

NEW YORK (AP) — Nike forgave Tiger Woods after he apologized for cheating on his wife. It welcomed back Michael Vick once he served time for illegal dog-fighting. But the company dropped Lance Armstrong faster than the cyclist could do a lap around the block.

What’s the difference? A marketer’s prerogative.

The world’s largest clothing and footwear maker has stood by athletes through a number of scandals over the years, but this week it became the first company to sever ties with Armstrong in the wake of allegations that he used illegal drugs to boost his performance during his 20-plus year racing career.

At least five other companies followed Nike’s lead, highlighting the tricky relationship that evolves when marketers sign multimillion-dollar deals with celebrities and athletes to endorse their products. Everything a celebrity endorser says and does could negatively impact the company he or she represents. And when something goes wrong, companies act as the judge and jury when deciding whether to continue those deals. They consider everything from the offense itself to the fallout.

“The tighter the association and the more intimate the relationship, it can sort of be like breaking up a marriage,” said Allen Adamson, managing director of branding firm Landor Associates.

Endorsement deals have been around for decades. The value of such deals are a closely held secret, but companies often shell out millions of dollars for celebrities to wear their shoes, use their Login to read more

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