SBJ/Oct. 21-27, 2013/Olympics

Athletes see rising social media demands

Skeleton racer Noelle Pikus-Pace has signed deals with Deloitte, Kellogg’s, TD Ameritrade, Under Armour and others ahead of the Sochi Olympics. Each agreement includes the usual contractual obligations such as personal appearances, but they also spell out social media requirements that will see her mention some brands a minimum of 25 times on Twitter and six times on Facebook before the 2014 Games.

The requirements highlight a change in the way Olympic endorsement contracts are being written ahead of the Sochi Games. Before the London Games, agents said, companies included loose language about social media, but contracts for Sochi are more prescriptive, spelling out requirements about the number of times an athlete must tweet, make a Google chat room appearance or post to Facebook or Instagram.

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Mancuso recently signed a deal with Jif that will be based almost entirely on social media.
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“There is an enormous growth in the contracts in social media content, demands and obligations,” said Patrick Quinn, who represents Pikus-Pace and oversees Chicago Sports & Entertainment Partners. “Not long ago, having an athlete blog a little or post a little was in some contracts and not in others. Now it’s in every contract, and in some of them it’s ridiculously complex.”

Social media has become so integral to sponsor activations ahead of the Sochi Games that some sponsors are even cutting deals that
are concentrated almost exclusively on social media. For example, skier Julia Mancuso, who is represented by CAA, recently agreed to a deal with U.S. Olympic Committee sponsor Smucker’s Jif brand that will be based almost entirely on social media.

“Sponsors might say, ‘I don’t need a service day. I can use stock photography, but I need a Google hangout and a Twitter chat. I need this many Instagrams. I need this many Facebook status updates,’” said CAA’s Lowell Taub, who works with Mancuso. “Now if they want social media, an agent can assign value to it.”

Taub said assigning value isn’t as simple as tabulating the number of Twitter followers an athlete has and charging sponsors 25 cents a follower, but he did say that followers and social media requirements become a central component in negotiations.

David Schwab, an Octagon senior vice president who helps companies select athletes for marketing campaigns, said that agents pitching athletes now include Facebook, Twitter and Instagram audience sizes in their submissions. It has become one of the first things companies evaluate.

“It is a quantifiable item that they didn’t have at their disposal just a few years ago,” Schwab said.

The social media demands also give agents and athletes something new to consider as they sign new deals. In the past, an athlete might be able to work with a half-dozen sponsors and appear in advertising for all of them without coming off as too commercial. Multiple tweets a month for that many sponsors, however, could turn their Twitter feed into an advertising page and cost an athlete followers, said Brandon Swibel, senior director with The Legacy Agency, which represents speedskater J.R. Celski.

“It’s a challenge for companies and athletes to find a happy medium,” Swibel said.

The increase in social media obligation is only one of the changes agents are seeing ahead of the Sochi Games. Agents also are seeing fewer non-Olympic sponsor deals than in years past and less demand for Olympic alumni appearances at the Winter Games.

The USOC has increased the number of sponsors that it has ahead of the Sochi Games compared with the 2010 Vancouver Games. Since then, it has added deals with BP, Chobani, USG, Smucker’s, Kellogg’s and others. That’s created more opportunities for athletes to work with sponsors, which typically rely on Olympians to be the face of their marketing programs.

But the opportunities with Olympic sponsors are being offset by a reduction in opportunities with non-Olympic sponsors in some cases. For example, the U.S. Ski and Snowboard Association requires its alpine skiers to sign a team agreement ahead of the Winter Games that includes an addendum preventing them from signing deals in select categories. New deals with Procter & Gamble, Kellogg’s and Diamond Nuts means the USSA is now protecting categories such as cereal, breakfast shakes, beauty and grooming, and nuts. Athletes could pursue deals in those categories prior to the Vancouver Games but can’t for the Sochi Games. As a result, Peter Carlisle, Octagon Olympic & Action Sports managing director, said there are fewer non-Olympic sponsors signing agreements than in the past.

Olympic endorsements with USOC sponsors tend to go for anywhere from $5,000 to $50,000 for one year, making them less lucrative in some cases than non-Olympic sponsorships, which often involve longer-term deals and pay more.

“Athletes have lost leverage,” said Carlisle, whose group represents snowboarders Seth Wescott and Hannah Teter. “It’s getting harder and harder to have [non-Olympic sponsors].”

Though the addition of new sponsors has closed off a few categories for athletes, USSA chief marketer Mike Jaquet said that the addition of P&G and Kellogg’s as sponsors has created an opportunity for athletes to work with Olympic sponsors who can feature them in advertising throughout the Olympics. (The International Olympic Committee’s Rule 40 clause prevents athletes from being featured in non-Olympic sponsors’ advertising immediately before, during and immediately after a Games.)

“I sympathize with the fact there might be non-Olympic opportunities that are difficult, but the Olympic opportunities are bigger because there’s more shared sponsors and the opportunity to use an athlete up to and through the Olympics is greater,” Jaquet said.

Another challenge agents are running into ahead of the Sochi Games is a reduction in demand for appearances. Because Sochi requires a 20-hour trip from the East Coast, many USOC sponsors have cut back on their hospitality programs from what they did at the 2006 Torino Games and 2010 Vancouver Games. That’s meant less demand for Olympians to make appearances at corporate events.

“Sochi is a tad leaner than Torino and Vancouver,” Taub said. “You hear a lot of chatter, especially as it comes to hospitality, that since it’s half a world away [there’s less interest than] Vancouver, which was a hop, skip and a jump away.”

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