SBD/August 24, 2012/Marketing and Sponsorship

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  • Lance Armstrong Stripped Of Titles, But Nike Says It Will Continue Support

    Armstrong could face litigation from SCA Promotions, which paid him a $7.5M in '06

    Cyclist Lance Armstrong will be "stripped of his record seven Tour de France titles after deciding to abandon his long fight against charges” from USADA, and the move leaves Armstrong "vulnerable to a tidal wave of legal claims from sponsors, promotion insurers and even the U.S. government," according to Nathaniel Vinton of the N.Y. DAILY NEWS. The U.S. Postal Service gave “tens of millions in sponsorship dollars to Armstrong’s teams, and the government may yet try to claw that taxpayer money back.” Armstrong is “one of the defendants in a whistleblower lawsuit" filed by former cyclist Floyd Landis in '10 under the False Claims Act, a law that "allows the Justice Department’s civil division to join plaintiffs in lawsuits that allege a defendant defrauded the U.S. government.” He also may “face litigation from SCA Promotions, a Texas company that paid him a $7.5 million performance bonus in 2006 after a bitter arbitration fight.” The company’s attorney notified Armstrong earlier this summer that the firm “would seek to claw that money back if he was stripped of his titles.” With more than $100M in endorsement fees banked, Armstrong “may be able to spend his way out of that litigation, but it’s unlikely he’ll ever recover the prestige he once enjoyed as one of the planet’s most admired athletes” (N.Y. DAILY NEWS, 8/24).

    STAND BY YOUR MAN: Longtime sponsor Nike is “standing by” Armstrong, saying in a statement it "plans to continue to support Lance and the Lance Armstrong Foundation, a foundation that Lance created to serve cancer survivors." In Portland, Erik Siemers wrote for more than a decade, Armstrong “has been one of the brightest lights in Nike’s galaxy of stars,” and his name adorns “one of the fitness centers on the Nike campus." However, Thursday’s developments presented “just the latest challenge for Nike and its stable of troubled athletes” (BIZJOURNALS.com, 8/23). ESPN.com’s Darren Rovell wrote even though Nike said that it will continue to stick by Armstrong and his foundation, “things will slowly change.” Rovell: “One has to think that the Livestrong line … will decrease in number. As will the donations to Armstrong's foundation, especially from the people who were inspired to donate by the miracle of his story. It's not as good a story, they'll say” (ESPN.com, 8/23). But in Houston, Randy Harvey writes, “Long after anyone recalls anything about the seemingly interminable controversy over Armstrong, performance-enhancing drugs and his seven Tour de France championships, Livestrong, with its yellow bracelets, will have contributed millions of dollars to fighting cancer.” USADA can “never take that away from Armstrong or the cancer patients who have been given hope because of his foundation” (HOUSTON CHRONICLE, 8/24).

    MORNING SHOW ROUNDUP: The news of Armstrong abandoning his fight was mentioned early in the broadcasts of all three network morning shows Friday. USA Today columnist Christine Brennan appeared on ABC's "GMA" and said, “This is a very sad day in sports. When you think of Lance Armstrong, you think of what he means to so many people, especially those fighting cancer” (“GMA,” ABC, 8/24). Bicycling Magazine Editor-in-Chief Peter Flax on "CBS This Morning" said Armstrong is “choosing the least-worst option in front of him." Flax: "He’s trying to find a place where he can take the moral high ground and claim he’s the victim of a witch hunt and it’s a damage control move.” CBS’ Armen Keteyian said USADA “has a stake in this politically to prove that Lance Armstrong has been doping to send a message to other athletes” (“CBS This Morning,” CBS, 8/24). NBCSports.com's Alan Abrahamson on NBC's "Today" said, “People have their own opinions about Lance Armstrong. He is probably the most polarizing figure on the Olympic or international stage.” Abrahamson added, “Cycling needs to take a really hard, solid look at itself and say, ‘We are a sport with a serious, serious issue. We’ve got to start cleaning this sport up’” (“Today,” NBC, 8/24).

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  • Top Two Picks In NFL Draft Offer Contrasting Strategies For Signing Endorsements

    Luck's sponsorship deals include some online ads for Nike and Gatorade

    The top two picks in this year's NFL Draft -- Colts QB Andrew Luck and Redskins QB Robert Griffin III -- face off against each other during a preseason game Saturday, and while Griffin is “already a marketing star who’s done TV spots for Subway, adidas, and others,” Luck has “done very little, and certainly nothing of a national TV scope,” according to Bob Kravitz of the INDIANAPOLIS STAR. Luck has “chosen to maintain a low profile his rookie year.” Unlike Griffin, Luck had to “stay at Stanford to finish his final classes, and missed some OTAs in the process.” Baylor Univ. graduated earlier in the year, giving Griffin “time before OTAs to film commercials for Gatorade, Subway and others.” Luck said, “I really didn’t have much time. And I wanted to make sure I had time to handle the stuff that mattered, whether it was moving into an apartment, finishing school or learning the playbook. There was so much going on, I figured the less time I spent promoting myself or doing ads, the better for me. I figured I’d wait and hopefully, at some point, a big fish will come along.” He added, “And really, to each his own. I don’t necessarily think my way is the right way. It’s what’s best for each person. It’s fun to see Robert capitalizing on his situation.” Kravitz notes Luck has done “some online ads for Nike and Gatorade, but nothing big and national like RGIII.” Luck said, “We talked about this right after school, but since then, we haven’t focused much on it. I’m living fine right now. I’ll focus now on football and maybe after the season is over, we’ll pursue some other opportunities, maybe something in the Silicon Valley. But for now, the time isn’t right” (INDIANAPOLIS STAR, 8/24).

    PRESEASON HYPE: In Indianapolis, Phillip Wilson noted the preseason Colts-Redskins game on Saturday is being “promoted on a T-shirt,” and the move indicates the “immediate marketability” of Luck and Griffin. Indianapolis-based retailer MainGate President & CEO David Moroknek said that the "QB Showdown" T-shirt was launched in both the Indianapolis and DC markets late last week, and “has already sold half of its stock” (INDIANAPOLIS STAR, 8/23). ESPN.com’s Paul Kuharsky noted the shirt is selling for $35. Kuharsky: “If you see that shirt and say, ‘Hey, I’d like to walk around in one of those,’ I beg you to reconsider” (ESPN.com, 8/21).

    Print | Tags: Marketing and Sponsorship, Indianapolis Colts, Washington Redskins
  • Serves & Volleys: Lindt & Sprungli Chocolate Releases New Ad Featuring Roger Federer

    Swiss chocolatier Lindt & Sprungli USA announced the launch of a new ad campaign featuring tennis player Roger Federer. The 30-second spot titled "Lost," which was developed by Gotham Inc., shows Federer having trouble finding his bag at an airport. The company also will give fans a chance to attend the ‘13 Sony Ericsson Open, through the "Perfect Match" sweepstakes on Facebook. Lindt & Sprungli also is creating a limited-edition Lindor truffles product featuring Federer to be sold at Lindt Chocolate Shops in N.Y. (Lindt & Sprungli). The ad will “begin airing on ABC, CBS, NBC and cable/syndicates on the morning of Sept. 3 (MEDIAPOST.com, 8/23).

    GETTING CHIPPY: Three-time U.S. Open champion Kim Clijsters appeared on "CBS This Morning" Friday, and host Charlie Rose noted the Babolat racquet Clijsters plays with has a “computer chip in it.” Clijsters said she first played with the interactive racquet at this year’s French Open and “it has sensors in the grip” called “Babolat Play and Connect.” Clijsters: “Tennis has become so technical, we have statistics about everything, but this racquet actually gives you so much information. ... For any pro it’s a detail that can make such a big difference” (“CBS This Morning,” CBS, 8/24).

    DON'T BE DECEIVED
    : The WALL STREET JOURNAL’s Seth Stevenson writes tennis player Novak Djokovic would seem “at first glance to be a spokesman more suited to endorsing a sports brand like Nike or Adidas, rather than a casual-wear brand like Uniqlo.” But he “provides instant global visibility of a sort” Uniqlo Founder Tadashi Yanai “craves.” Djokovic has “already notched a signature accomplishment Yanai-san envies: He's reached number one in the world” on the court (WALL STREET JOURNAL, 8/24).

    Print | Tags: Marketing and Sponsorship, Tennis
  • Marketplace Roundup

    KPMG launched the "Where Is The Blue Hat Taking You?" campaign with Mickleson

    KPMG, official hat sponsor of golfer Phil Mickelson, on Thursday launched the "Where Is The Blue Hat Taking You?" contest. The interactive social media campaign focuses on Mickelson's new blue hat. The contest invites fans to participate by purchasing Mickelson's blue hat and submit creative photos via Twitter that features the hat with the hashtag #PhilsBlueHat. Ten of the most creative submissions will be selected as finalists. Fans can vote on their favorite photo on PhilsBlueHat.com and the winner will receive an invitation to join Mickelson in San Diego at the Oct. 15 Monday Night Broncos-Chargers game. KPMG partnered with Mickelson and non-profit First Book in March to launch "Blue For Books" in an effort to raise awareness of the importance of literacy. For every hat purchased at PhilsBlueHat.com, KPMG donates 100% of the proceeds to First Book (KPMG).

    LOSING STEAM: The FINANCIAL TIMES' Waldmeir & Tsui reported Li Ning "has warned it may post a full-year loss due to inventory overhang and slowing domestic economic growth." Its shares "fell 3.8 per cent in Hong Kong on Thursday, compounding a 4.5 per cent fall on Wednesday." Li Ning on Wednesday night "reported an 85 per cent drop in first-half net profit" to $7M. The company said that it "expected its second-half gross profit margin to be similar to the first half's 44.2 per cent, which was down from 47.3 per cent a year earlier." Li Ning CFO Nicholas Chong said that one reason for the "projected full-year loss is that spending on the recently concluded London Olympics ... will be booked primarily in the second half" (FINANCIAL TIMES, 8/23).

    EXPANDING THE MARKET: ESPNW's Kate Fagan wrote there are "fewer marketing dollars for female athletes than their male counterparts, less pie to go around, and Lolo Jones happens to be one of the small number of women who've been able to make their brands stick." This should be "a cause for celebration for all female athletes, that a hurdler -- not a basketball player, not a soccer or tennis star, but a hurdler -- has become a household name." Before Jones "burst onto the scene, the amount of sponsorship dollars bestowed upon female hurdlers was minimal." She "created a market for herself where there was none" (ESPNW.com, 8/23).

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