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Money Smart Athlete Blog

Commercial Exploitation of the Athlete’s Brand

Nov 15, 2017 | The Athlete's Brand

Brands, political parties, humanitarian organizations among others strive to partner with sports and other celebrities, who with their advocacies and preferences influence purchasing and consumption patterns. The capacity to attract attention is a lucrative asset in a knowledge-based society. Information is a key factor to publishers, whether it be in social media, film, radio, TV, ad campaigns, political campaigns or advocacy movements. The rewards attached to the accumulation of attention capital are endless in our information based society. An athlete can be anything from an endorser of an automobile brand, to a brand ambassador of a clothing brand, to a political tool used to influence voters, to a humanitarian or charity campaign supporter.

There are numerous ways through which a sports celebrity can monetize on his/her image and we list just a few below:

1.Endorsements

Endorsements by sports stars are considered quite valuable for brands and they are sought at various stages during the life cycle of a product. The promotion of the endorsement through the social media accounts of the endorsing athlete provides a direct way for celebrities to publicly endorse products and share their enthusiasm with their fans, and it is considered a core part of an endorsement strategy nowadays.

Endorsement contracts usually have a definite time frame, usually anywhere from one to five years with an option for renewal, within the time frame that the sports celebrity is active in his/her sport, and they may include one particular product or a range of specific products. The compensation can take many forms, from a fixed fee to a percentage of the sales of the endorsed products. Third party endorsers may provide bonuses for athletic achievement within the endorsement period.

It is worth noting that both Ronaldo and Lebron James have struck lifetime deals of US$1 billion each, with Nike, therefore in this case the time frame of the revenue extends to their lifetime!

2.Sponsorships

The emphasis in a sponsorship is that the sponsoring brand supports the sports celebrity and hopes that his or her appeal to the public will have a positive effect on the brand’s product sales.

Sponsorships create a more involved contractual commitment for the celebrity athlete because of their long term nature and because the sponsor requires certain actions from the athlete in return for the sponsorship fee paid to him/her. Sponsorships can create a good-size income stream for the athletes as a lot of companies from various industries are moving towards this direction to raise brand awareness and recognition. Celebrity athletes are usually sponsored from various companies in different industries, simultaneously.

3. Merchandising

While endorsement is about the product, with the athlete used as a marketing tool, merchandising is more about the athlete behind the image and the sale of a range of products under that athlete’s name and image.

Merchandising often involves various parties while the celebrity is at the core of the product’s marketing campaign; he/she is not usually responsible for the design or production of the goods. The celebrity may or may not have overall strategic control depending on the agreement he/she has entered into. In a lot of cases, a company with experience in the field of, for example perfumes, can seek permission to use the celebrity’s name for a particular perfume thus making this a licensing deal.

4. Other uses

  • The image rights of an athlete may be exploited by his team in a variety of ways, through appearances, use of his image on merchandise, etc. In these cases the team enters into a separate contract with the player for the use and common exploitation of his image. This is something that David Beckham had created and perfected in the soccer industry, by always asking for a separate compensation amount from soccer clubs for the use of his image.
  • Also, an app or a computer game may seek to feature a celebrity athlete’s likeness and the athlete can be compensated either through a flat fee or a licensing agreement based on the sales of the computer game.
  • Athletes can also receive royalties for films, documentaries, books, etc.
  • Athletes can fully or partially sell the commercial exploitation of their image rights within a certain region or globally.

The image of sports celebrities has become a tradable commodity nowadays. Money Smart Athletes utilize their image strategically while still in the limelight and turn it into a long-term brand that withstands the test of time.

For more information on how to strategically design the commercial exploitation of your brand, you may contact us via email at constantinos@apc-sport.com

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