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Volume 24 No. 113

Sponsorships Advertising Marketing

          Ameritech "won't commit to an extension" of its three-
     year WTA Tour sponsorship, according to Len Ziehm of the
     CHICAGO SUN-TIMES.  Brian Fitzgerald, Dir of the Ameritech 
     Cup in Chicago, "spent considerably more time than usual"
     monitoring the event last week, "and "didn't like much of
     what he saw regarding the WTA's organizational efforts."
     Fitzgerald: "I look at it from a marketing point of view,
     and they're missing a lot.  They make it so difficult to
     market their sport because they don't know who's playing
     when.  Match times are always subject to change.  They've
     got to bring some organizational sanity to it."  Fitzgerald
     said that while IMG has "made significant inroads in
     attendance" this season, it may not be enough "to keep its
     tournament sponsor."  Fitzgerald believes "far bigger crowds
     are possible."  Fitzgerald: "If I could, I'd publish
     brackets with the time each match is going to be played. 
     That's the prime reason we don't draw crowds early in the
     week.  Monica Seles is the top draw in tennis, but for a
     tournament to properly market, it's got to be able to tell
     people when [Seles] is going to play" (SUN-TIMES, 11/9).

          Replica "99" Statue of Liberty jerseys with Wayne
     Gretzky's name misspelled, "Gretkzy" as it was for an
     October 30 game, will be on sale at MSG this week for $999
     (N.Y. POST, 11/9).....The Pacers have hired NJ-based
     Integrated Sports Int'l to market naming rights for its new
     Indianapolis Fieldhouse arena (ISI).


          Working conditions at Nike-contracted factories in
     Vietnam and Asia were in the news again over the weekend as
     findings from an audit conducted for Nike by Ernst & Young
     was obtained by the media.  The report found "many unsafe
     conditions" at a Nike factory near Ho Chi Minh City where
     workers "were exposed to carcinogens that exceeded local
     legal standards by 177 times in parts of the plant" and
     showed that 77% "of the employees suffered from respiratory
     problems."  The Ernst & Young report was highlighted in a
     front-page feature by Steven Greenhouse in Saturday's N.Y.
     TIMES.  The findings also showed that employees were "forced
     to work 65 hours a week, far more than Vietnamese law
     allows, for $10 a week."  Greenhouse: "The inspection report
     offers an unusually detailed look into conditions at one of
     Nike's plants at a time when the world's largest athletic
     shoe company is facing criticism from human rights and labor
     groups that it treats workers poorly" (N.Y. TIMES, 11/8). 
     As the study was released to the media, Nike issued the
     complete report findings in a news conference on Friday
     afternoon.  The audit was conducted in November '96 and
     submitted to Nike in January '97.  Vada Manager, Nike Senior
     Manager for PR, said the company has taken steps to improve
     factory working conditions upon receiving the report,
     including reducing overtime hours and restricting the work
     week; upgrading the ventilation systems; and ensuring proper
     safety equipment for workers.  Manager: "Clearly, this
     report is not a whitewash.  By the recommendations cited in
     this audit and steps Nike has taken to improve the working
     conditions, it is clear that our system works" (Nike).
          REAX:  The FINANCIAL TIMES' William Lewis called the
     report "embarrassing" for Nike (FINANCIAL TIMES, 11/10).
     ...In N.Y., Phil Mushnick asks, "Where do all the Nike-
     bought social activists go when these reports are revealed?
     ... And how many TV networks take a dive on these stories
     because Nike spends millions advertising $150 slave-wage-
     made, status symbol sneakers to kids?" (N.Y. POST, 11/10).
     ...In Washington, DC, "more than" 50 lawmakers called on
     Nike "to improve labor standards in Third World factories
     and to employ more people" in the U.S.  A letter to Nike
     Chair Phil Knight said, "As members of the U.S. Congress we
     are deeply disappointed and embarrassed that a company like
     Nike, headquartered in the United States, could be so
     directly involved in the ruthless exploitation of hundreds
     of thousands of desperate Third World workers."  The letter
     was spearheaded by Rep. Bernard Sanders (D-VT) and Rep.
     Marcy Kaptur (D-OH) (BLOOMBERG/NEWSDAY, 11/10)....At UNC-
     Chapel Hill, "roughly" 200 students rallied Friday afternoon
     and "vowed to pressure Nike to improve its labor practices."
     UNC-Chapel Hill Chancellor Michael Hooker defended the
     university's athletic marketing partnership with Nike but
     did promise a campus committee would review future corporate
     relationships at the university (NEWS & OBSERVER, 11/8). 

          In Portland, Jeff Manning, who spent a month in Asia
     examining Nike and other companies' business practices,
     debuted part one of his three-part series on Sunday that
     included a "rare" interview with Nike Chair Phil Knight. 
     Manning wrote that Nike products "more than doubled" over
     the past three years, "forcing the company and its
     subcontractors to crank up production.  That, in turn,
     increased the heat on workers and, in some cases, led to
     outright abuse.  The resulting backlash promises to dog Nike
     well into the 21st century."  Manning: "Nike has become an
     international incident."  Knight is "by turns furious and
     philosophical" abouth the criticism: "For whatever reason,
     we've been the poster boy on globalization.  That's a very
     emotional topic" (Portland OREGONIAN, 11/9).
          WORKING HISTORY: Manning traced Nike's working
     relationships with Asian factories and wrote that by '97,
     "that network spanned 33 countries on four continents and
     had presented Nike with a complex set of issues, many
     cultural differences and occupational health standards."  In
     the interview, Knight said the labor controversy is not
     hurting business, even with a 20% drop in stock price since
     January 1.  Knight: "I don't attribute that to the fact that
     we're getting any sort of resistance from our core
     customer."  Nike officials say that critics are "unfairly
     singling out their company and are distorting" the issue. 
     Knight: "Nike creates a lot of emotion.  A lot of that
     emotion is positive.  But there's a flip side to that. ...
     The people who are turned off by the emotion that we
     generate really want to believe these things.  They
     basically view us as a rebel that should be taken down." 
     Manning: "As serious as Nike's image problem has become, the
     company has no plans to change its hugely profitable
     subcontracting strategy.  The cost-cutting expertise of the
     subcontractors produces profit margins and cash that
     domestic manufactures find hard to match" (OREGONIAN, 11/9).

          The first Nike ads "developed specifically for the
     Chinese market, star local hoopsters and make earnest
     appeals to Chinese nationalism," according to Sally Goll
     Beatty of the WALL STREET JOURNAL.  As Nike has been "stung"
     by critics of its aggressive marketing tactics overseas, the
     company "is starting to play down its rebel image outside
     the U.S.," including "doing away with the antiauthority
     rhetoric" and avoiding its U.S. stars.  Nike Dir of Global
     Ad Geoffrey Frost said that Chinese youth "admire Michael
     Jordan," but by using local athletes Nike is "letting people
     know in China we see them as heroes."  Beatty: "Still, it's
     unclear how well the culturally sensitive approach will go
     down with kids in China. ... Boosting sales abroad won't be
     a layup.  Nike's best-selling shoes in China cost the U.S.
     equivalent of $59 to $78 -- still out of the reach of most
     ordinary Chinese" (WALL STREET JOURNAL, 11/10).