Back Talk: What Can Marketers Learn from the Lance Armstrong Sponsorship Scandal?
The U.S. Anti-Doping Agency’s report that Lance Armstrong led doping programs for himself and teammates not only ended Armstrong’s career and stripped him of his seven Tour de France titles, it also saw notable brands such as Anheuser-Busch InBev, Nike and Trek Bicycles sever fruitful and long-standing ties with the athlete. It was like the Tiger Woods scandal of years past, version 2.0: all the more serious because of Armstrong’s noted personal and professional achievements. While the decisions to end sponsorship in this case seem almost obvious, they did prompt a discussion with my Vertical Marketing Network colleagues. Over the summer, we watched “guerrilla marketing” campaigns from unofficial sponsors such as FedEx, Nike and fast-food chain Subway score gold at the Olympics. More and more often, official sponsorship seems to backfire. Or, just as bad: not be worth it. Yes, it can be rewarding for both parties when done right, but with more consumers turning to social media and word of mouth for opinions, it seems like sponsorship could go the way of Armstrong’s career: down the drain.
Maybe I’m just blogging out loud, but it seems like sponsorship is a real gamble. While it can pay big to play hard, even the shrewdest of brands can be dealt a wild card.
Which prompts some questions: What can marketers learn from scandals such as this one? Is sponsorship worth it? Have the events of the past several months challenged the ways you think about the benefits of official sponsorship? Do the benefits for brands outweigh the risks involved in these kinds of relationships?
Please leave a comment in the section below, or join the conversation on the Vertical Marketing Network Facebook page.
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I agree with Phil that there are always risks. I do think that sponsorship is a big play in promoting a product. We want to identify with the spokesperson, we want to believe that they are sincere … then something happens which really goes to prove that we are all human and do err … hopefully not at the cost of others. It doesn’t take away from their being a great athlete and dedicated to their sport, as I truly believe that Tiger Woods is a great golfer, that Lance Armstrong is a great cyclist … and Charlie Sheen is … oh, never mind!
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Armstrong is indeed losing much more than just Nike- 9 other sponsors dropped him as well, and ESPN estimates that the loss of those sponsorships is costing him more than $35 million. On the flip side, the weekend after Armstrong was stripped of his Tour de France wins, his Livestrong foundation raised $2.35 million in just one weekend. I imagine many of his fans and supporters are conflicted on the issue, since his record on the bike isn’t so pristine, but his work with his foundation and cancer research has undoubtedly left a resounding impact.
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Hanes pulling the plug on Charlie Sheen in 2010 after domestic abuse charges were filed.
Afflac dropping Gilbert Gottfried after his insensitive jokes about the Japanese earthquake.
And now Nike’s $10 million a year deal with Lance Armstrong ends.
There are always risks involved with these type of sponsorships and always a chance for these type of relationships to turn into a nightmare deal. But….the ability to leverage sponsorships to break through the clutter, unify messaging between all audiences for a brand, and to experience the halo effect from the celebrity/athlete/event, makes sponsorships an effective sales and marketing strategy.
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Life contains immeasurable risks. If mankind didn’t take them, we would all be huddled securing in our cold, hard caves. Marketing is no different; the future is only an educated guess filled with rewards and disappointments. So, Go for it!
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