In the wake of the news that Maria Sharapova failed a drug test at January’s Australian Open, sponsors such as Nike and TAG Heuer decided to suspend and pull out of deals with the tennis player. Much has been written in recent months about the impact of doping and corruption scandals on particular sports and the people involved but what about the brands who invest millions to associate with the sources of sullied goods? How should they react?
2015 saw FIFA sponsors calling for a major change in football to stamp out corruption. Some sponsors threatened to reassess their sponsorship while sponsors Coca-Cola, McDonalds, Visa and Budweiser went so far as to call for FIFA president Sepp Blatter to resign. While this illustrates that sponsors will take steps to protect their brand equity, in truth sponsors have kept their deals intact. The Sharapova scandal and other, more recent scandals, suggests a change in behaviour from major sponsors.
One of the most recent sporting scandals concerning the International Association of Athletics Federation caused Adidas to ceremoniously end its sponsorship four years early, sending a clear message. However this incident was different to any other, as the UK’s Independent so eloquently explains; “It is a scandal that has stepped on to the field of play. It is about cheating. If the integrity of the sporting contest is lost, the motivation for your logo to be all over it is lost too.” In recent months, Nestle has also moved to end is partnership with the IAAF citing that the brand had concern for its own reputation in light of the scandal. While the IAAF is challenging the move, it is yet another blow to this once reputable organisation and an indication of just how much brands value sponsorship’s ability to make or break brand image.
The most recent scandal with Maria Sharapova further highlights how sponsor brands are becoming more reactive in their response to scandals, leading to the question of whether brands are entering an ‘era of zero-tolerance’. Nike seems to be following this trend as just last month it dropped boxing champion Manny Pacquiao following his alleged homophobic comments and previously cut ties with Lance Armstrong and Oscar Pistorius. Sharapova is just the latest to experience the zero-tolerance mentality of the brand.
Despite much international scandal, sport sponsorship remains on the up on home soil. In Ireland, brands are continuing to renew sponsorships such as Ulster Bank with its IRFU rugby partnership and Allianz extending its sponsorship of the GAA football and hurling leagues, not to mention Lidl’s three year partnership with the LGFA. Meanwhile, Toyota have renewed its partnership with Cricket Ireland and Volkswagen committed to a partnership with Hockey Ireland.
Either way sponsors must be prepared for the potential of a scandal of some sort. With a great sporting year ahead to look forward to, it is expected that brands will continue to embrace sports sponsorship but remain wary of the possibility of negative backlash as they take note of developments in the global sponsorship market.
Image credit: Heavy.com