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MUST-READ ON SHOE COMPANIES DROPPING ATHLETES AS ENDORSERS
Published May 27, 1998
The decline in footwear sales among sports companies and its impact on those companies' endorsement rosters was examined in "The Endorsement Game," a four-story feature over two-issues by Jeff Manning of the Portland OREGONIAN. In a front-page, above-the-fold piece on Monday, entitled "Slump Speeds Slowdown of Spending On Athletes," Manning reported that at Nike's quarterly meeting in January, sources said that company Chair Phil Knight said he would rather cut athletes than lay off a single Nike employee. But, Manning added, while companies debate whether they can afford the luxury of paying athletes to hawk their products, Nike "is the most reluctant to cut back." Nike has been "particularly tough on track and field athletes, in part because there are no Olympics or other" major events this year, and is also "cutting many of its ties to bicycling, particularly road racing." Other shoe companies "are pulling out of some sports nearly entirely," including Fila which is getting out of the football shoe business. Fila VP/Advertising Howe Burch: "Kids just aren't as inspired by athletes because a) there are too many of them, and b) because of their behavior." Reebok VP/Sports Marketing John Frascotti: "[W]e've hit a salary cap. We sort of lost track of the reason for doing these deals" (OREGONIAN, 5/25). NIKE CHANGES? Nike critics argue that the company needs to take a "more selective approach to sports marketing," a department that some insiders "long had argued needed overhauling." Manning reported that a "vocal faction within Nike is dissatisfied with Nike's mass-endorsement approach, which they said is 'see 'em, sign 'em.'" A former Nike insider: "Phil [Knight] agrees this needs to be more strategic. But Phil's the one who throws a fit if they let an athlete go" (Jeff Manning, Portland OREGONIAN, 5/25). THE DEBATE GOES ON: Among other aspects of Manning's report: Sunday's front-page feature ran under the header, "A Sports Marketing Juggernaut At The Crossroads: Nike and its competitors built their empires in an unprecedented partnership with athletes, but now the wildly successful strategy is in doubt." In a sidebar on Sunday under the header, "Forget Research: Endorsements Just A Lot Of Fancy Footwork," Manning wrote that Nike spent $300M last year "largely on gut instinct." While Nike and other companies know what they want from an endorser, they're finding it "more difficult to determine whether they're getting their money's worth" (OREGONIAN, 5/24). On Monday, Manning wrote a sidebar under the header, "Scandals Don't Keep A Shoe Firm From Celebrating Its Superstars" (Portland OREGONIAN, 5/25).