Lance Armstrong and the Future of Sponsorship

SyringeLike the rest of the world, I just finished watching Oprah’s interview with Lance Armstrong. And like the rest of the world, the revelation that he’s a cheat came as no real surprise. What was surprising was how utterly devoid of contrition it was. One of the alarmingly few emotional moments was when he talked about his sponsors and “losing $75 million in one day”. We weren’t watching a heartfelt confession; we were watching Sociopathy 101**.

Although there is a temptation to plunge headlong into an analysis of the interview itself, I’m going to try to control myself. Honestly, the whole thing has been analysed to death. What I’m going to address is what it means to our industry – and yes, part of that has to do with the tone and content of the interview.

I write a lot about meaning and emotion being the drivers of sponsorship. Sponsors have the privilege of connecting with people through something they have already decided they care about. More than almost any other high-profile athlete, Lance Armstrong had that emotional bond with people. He was the All-American sporting hero, coming back from incredible odds after cancer, unprecedented wins, founding a charity that has raised almost $500 million for cancer awareness and support. Stories don’t come a lot more emotion-charged than that, and that is the very powerful conduit that sponsors used to achieve big brand results. And then it was gone.

What happens to cycling, to fans, and to our industry when one of the world’s biggest hero stories turns out to be fiction? And what happens when the world is dissatisfied with the hero’s “remorse”?

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There is little precedent of this scale to guide our industry, and I’m not going to pretend that I can see the future with absolute accuracy. But I’ve been doing sponsorship for a long time, and I can see a number of angles where this will likely have big impacts on our industry.

The future of cycling

The fact that Armstrong wasn’t prepared to name names, and that he implied that he didn’t consider what he was doing to be cheating, because it evened the playing field, has put the entire sport under a big, black cloud. Correction: A bigger, blacker cloud.

Were drugs and doping endemic to the sport? If all the riders of Armstrong’s generation had their samples retested, as he did, how far down the list of Tour de France finishers would we have to go before we found someone clean? Or did Armstrong just decide that if he was going down, the whole sport was going to go down with him?

More important to the future of the sport, is it still endemic? That’s a big problem for the business of professional cycling, because as the Armstrong situation has shown, everyone competing in professional cycling could test clean, only because there isn’t currently a way to screen for some new generation of performance-enhancing drug. Even if that’s not the case, managing that perception among fans is going to be tough.

“Yeah, sure… the Tour says they’re all clean, but that’s what they said about Lance Armstrong.”

Then there is the handful of pundits and academics calling for the legalisation of doping and drugs in sport, as if accepting some particular “harmless” level will make the sport more legitimate, and cheaters more likely to play within the rules. Yeah, that’ll be attractive to sponsors.

Can Brand Armstrong come back?

People love a comeback, but will it happen this time?

Tiger Woods has made a comeback, of sorts. He’s back to playing good golf, but will never enjoy the hero status he once had. Then again, his personal brand of cheating wasn’t performance enhancing, so while the world’s image of him as a man was diminished, the fact that he is the greatest golfer of his generation still stands.

Armstrong is a different situation altogether. There’s the cheating that’s been admitted, and the alleged cheating still denied, and it’s all about the performance.

He thinks he’s been hard done by – that the lifetime ban from all sanctioned sport is unfair, given the lenient penalties given to other disgraced cyclists. I can’t help thinking about the “disgrace and disrepute” clauses in sports and sponsorship contracts around the world – clauses that have cost careers and future earnings for infractions that, realistically, caused only minor and short-term damage to a sport or league or team. Then, I think about the almost unprecedented degree of damage this has done to the credibility of a sport and an entire level of athletic competition. Either he doesn’t get that or he just doesn’t care.

There was a moment in the interview when Oprah asked, “Will you rise again?” I don’t think so. Someday, somehow, maybe he’ll get a break and he may compete in something again, but will he ever again be a hero? I can’t see it.

What should/will the sponsors do?

There is talk that some of Armstrong and his team’s former sponsors are considering suing to get their multimillion dollar sponsorship fees back. On one hand, these sponsors might think it will stand them in good stead with their target markets if they share and amplify the outrage, but honestly, the whole idea is ridiculous. These sponsors paid huge money for a marketing platform for a certain amount of time. They (hopefully) leveraged that platform and achieved objectives for their brands. Armstrong and Co did their bit to maintain the squeaky clean image required by those sponsors during the contract tenure, and the sponsors benefited.

Yeah, the image turned out to be a big, fat lie, but when that came to light, they ended their relationships. In the meantime, they had a good run. No one is holding the brands accountable, as they were just as blindsided as the fans. We all wanted the allegations to be wrong, and fans and sponsors probably all held onto that for too long. That said, no one is now saying that Trek makes crap bikes because their former spokesman cheated when he rode one. No one is trading in their Subaru because it used to have Armstrong’s stamp of approval.

So, from my strictly non-lawyer point of view, was there breach of contract? Yes. Did that breach being proven years after his sporting career ended damage the brands or their results? No.

The exception to this may (emphasis on “may”) be Nike. Were they complicit in covering up a positive test, as has been alleged? Please, please let that not be true, as that would surely rock the very foundations of the brand.

How many sponsors will leave the sport? That’s to be seen. How many are reconsidering their investments? Sources are telling me quite a few. Seriously, if you were a brand manager, what would you do?

In any case, my prediction is that sponsors of individual athletes will start building in clauses for fees to be refunded (at least) if at any time in future, it is proven that they used drugs, doping, or any other method of cheating to enhance their performance during the contract term. On one hand, that would take the “disgrace and disrepute” clause to a wholly draconian level. On the other, maybe that’s the stick that changes the culture of a sport. Either way, I’m predicting that something along these lines will happen.

I also believe sponsors will become even more wary of sponsoring individual athletes. If a sponsored athlete is suddenly disgraced to the point where a sponsorship is untenable, it’s not going to damage their brand value, but if they’ve built a big leverage plan around a platform that’s suddenly gone, their entire strategy may go out the window, costing them time and marketing opportunity.

Before you say, “Same goes for the Armstrong sponsors who have just recently jumped ship”, the allegations around Armstrong have been building to a crescendo for years. If those sponsors didn’t have contingency plans in place, they have bigger problems than a disgraced spokesperson.

What about Livestrong?

I’ve heard a few people talk about Livestrong, as if that’s evidence that Lance Armstrong really is a good guy. I think the jury’s still out on that. Here’s the thing about sociopaths**: They don’t tend to do good things because it’s a good thing to do; they tend to do good things because it makes them look good. And it certainly did make him look good.

Please note, I’m not taking anything away from the good done by the organisation and the people it’s helped, or Armstrong’s huge contribution to that. Whether Livestrong started as a genuine attempt to make the world a better place or an image-builder is irrelevant, at this point. The organisation has grown well past the point where it needs him. It means a lot to a lot of people, and has created a global community for cancer support and healthy living, and I believe it will continue to thrive past the downfall of its founder.

I will say that there is no time to lick their wounds. Staying quiet only reinforces their bond with Armstrong. They need to move on visibly and soon. Mobilise the believers with the message that Livestrong Moves On. They don’t need a guy in a yellow jersey. The cancer patients, survivors, and their families are heroes enough, and with that at the core, they should be just fine.

 

**Now, before anyone flips out that I’ve called Armstrong a “sociopath”, please note that Oprah referred to him as a “sociopath”, and he agreed, adding that he was a “narcissist”. The behaviours he’s admitted, and even the way he admitted them, conform very closely to Factor 1 of Hare’s Psychopathy Checklist. (Psychopathy and sociopathy are the same thing.) Unfortunately for everyone involved, most experts – including an article on the Livestrong site – agree that prognosis for a sociopath is patchy, at best, and that true emotions tend to be short-lived.

© Kim Skildum-Reid. All rights reserved. For republishing information see Blog and White Paper Reprints.

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