The most dramatic recent example of an endorsement deal gone way south is Kobe Bryant. With former teammate Shaquille O'Neal now departed for the Miami Heat, Mr. Bryant no longer needs to share the on-court spotlight at Los Angeles Lakers games. But the sexual assault charge that put the brakes to Mr. Bryant's five-year, $45 million endorsement deal with Nike persists with a civil trial lurking in the future.
Picking an effective endorser is no sure thing even for the savviest marketers like Nike.
"Who would ever have thought that a guy as clean-cut as Kobe Bryant would get into the trouble he did?" asks Howe Burch, until recently the head of worldwide marketing for Fila and now principal of Twelve, a sports marketing company based in Baltimore.
"The foundation of credibility is what they do on the field," says Jeff Price, VP-chief marketing officer at Time Inc.'s Sports Illustrated. "Like they say, past performance is no guarantee, but it may be an indicator of the future."
TURNING POPULARITY INTO ASSETS
"Performance on the field of play does not necessarily make for a smooth transition toward sports celebrity stardom," notes Paul Swangard, managing director of the James H. Warsaw Sports Marketing Center at the University of Oregon. "There are also aspects of one's personality, one's character, one's exigency that make an athlete into a great asset."
The importance of such intangibles is evident in a consumer survey that Knowledge Networks conducted for this Special Report. Many respondents believed that character traits count as much as, or more than, athletic prowess. When asked how such traits factor into whether an endorsement will influence their opinion of a product, 53% said it's extremely important that the endorser not use drugs and 13% wanted the athlete to be religious; only 11% said it was extremely important for the athlete to be very successful in his sport.
One surprise was that people didn't say they required athletes to be "people like me," says Darren Marshall, VP-client service at Knowledge Networks. "Age, gender, background didn't make as much of a difference as we expected, whereas character issues came through more strongly.
"Maybe we don't expect our athlete heroes to be exactly like us. But they have to play a sport we like, and they have to have good character."
At the end of the day, the onus is on the marketer and its advisers to handicap the endorsement potential of a star athlete.
"Ultimately, it comes down to an individual decision by the marketer," says SI's Mr. Price. "How relevant and how credible is the endorser of the product? Is there any potential real connection to that product? The easy ones [to rule out] are the morals clause issues."
Peter Stern, president of Strategic Sports Group, New York, says his company applies the following method to evaluate sports endorsement matchups: "No. 1-Does the athlete have a clean image? There's too much at stake for the brand to enter into a risky relationship. No. 2-Does that athlete perform? Does he or she convey an aspirational quality? People want to look up to sports stars."
"Character is key, but it is interesting because there are dynamic differences from one sport to the next," Mr. Burch says. "No question, it's still an art."
"Take [Olympic swimming gold medalist] Michael Phelps, who has deals with Visa, Speedo and [General Mills'] Wheaties, among others," Mr. Burch says. "He's an all-American kid. Those types of sponsors want athletes to conduct themselves with as much grace and character outside the pool as in it."
But, Mr. Burch continues, in "basketball, you may be looking for street smarts, a kind of swagger or a maverick quality. For example, an Allen Iverson. Among hard-core basketball consumers that's OK. He's from the streets. They admire him."
The leagues can help make their stars marketable by trying to keep them on the straight and narrow, and one of the more image-conscious is Nascar. The stock-car racing organization made headlines recently when it fined Dale Earnhardt Jr. $10,000 and 25 points for using profanity during a victory-lane TV interview.
"Dale Jr. said something on national television that he shouldn't have said," says Kirby Boone, president of Sports & Promotions, Mooresville, N.C., which represents Procter & Gamble Co.'s Tide and Old Spice Nascar racing teams. "There was a precedent set earlier in the year with two other drivers. Nascar was consistent in the amount of docked points and fine."
But while marketers prefer their endorsers to be upright, they still want these athletes to have an edge. Mr. Boone says the current endorsement deal with Nascar driver Tony Stewart helps Old Spice Red Zone anti- perspirant convey brash masculinity and high endurance to its youthful target audience.
"Nascar is a family sport," Mr. Boone says. "These guys know that. Self-control is part of being successful, on and off the racetrack, from a sponsorship perspective."
"It often depends on the categories you are looking at," says Peter Land, exec VP-general manager at Edelman Sports & Entertainment Marketing, New York. "For `tools of the trade' endorsements like Adidas basketball shoes or Head tennis rackets, or other products that the athlete wears or uses in his or her sport, the connection may be easier to see."
Athletes may fit into varied endorsement niches, says Bud Martin, senior VP at SFX Sports Group, Pittsburgh, a unit of Clear Channel Media. "In American culture, it is almost as acceptable to have fallen on your face and then come back. But this varies a great deal from product to product. Certain products would tolerate the blips. On the other hand, maybe for a financial services firm you cannot have an endorser who behaves badly."
On the plus side, says Mr. Stern, "A few athletes possess an intangible we call `brand slam'-that's where an athlete transcends their sport to become part of the greater popular culture."