19 October 2012 28 Comments

Nike Inc., Lance Armstrong and reputation issues

Author: yinkaolaito

Yinka Olaito is happy,excited and passionate Communications & Media specialist, Trainer and speaker. Yinka Olaito helps Profits and Non-profits with effective communication and positioning for premium service delivery and returns. Yinka Olaito also has special interest in Development Communication and has consulted for noted UN Agencies. Yinka Olaito is the CCO of Michael Sage Consulting(Communication/digital media), African Child Education Right Initiatives(NGO) and Content Director, Africa Development Talk( online Platform for discussion on Policy, Governance, development across Africa) and Africa Foundation for Young Media Professionals

Lance Armstrong, Lance Armstrong and doping, Nike Inc. and Lance Armstrongs endorsement deal, Livestrong Foundation, Brand transparency, Brand authenticityNike Inc. has terminated its long standing brand endorsement deal with Lance Armstrong is no longer news. It is an open secret that Nike’s deal with Lance Armstrong had earned him fortune. For those who do not know, Lance Armstrong survived cancer and bounced back to life through cycling and tours. He was an inspiration to many. Lance’s tour de France of 1999 to 2005 among others still remained fresh in our memories. Lance Armstrong fourteen year careers was a ray of hope to many. Lance Armstrong was never self-centred as he founded Livestrong Foundation through which he touched lives.

On the other hands also, Nike Inc. is known for extra-ordinary commitment to its ambassadors. Even when they were embattled in fights to reclaim their reputations, Nike had stood by athletes like Tiger Wood( infidelity case), Kobe Bryant(sexual assault) among many others. But events in the last few weeks had propelled Nike Inc. to pull the trigger. The endorsement deal was dropped. This decision was traceable to many damaging and revealing evidence against Armstrong by US Anti-doping Agency on how Armstrong used performance enhancing drugs to facilitate his cycling victories during his fourteen years career.

Nike had stood with Armstrong through thick and thin but the overwhelming evidences supplied to the public against Armstrong could not be helped. Nike Inc. reason was hinged on the fact that it believed Armstrong ‘misled’ the organization for about a decade. Nike felt Armstrong had been economical with the truth.

Today Lance Armstrong had been relieved of all his titles, banned from cycling for life among other penalties. This break in endorsement with Nike will negatively affect Lance’s fortune. To reduce the effect of this negative impact on Lance Armstrong’s foundation (LIvestrong-a cancer fighting charity), Lance has stepped down from his chairman position of the Non- Profit organization.

Apart from Nike Inc. some other sponsors like sponsor Anheuser-Busch announced it’s dropping the cyclist when his deal as a Michelob Ultra brand ambassador ends on Dec. 31st. The Giro brand, which produced a custom $15,000 bike helmet for Armstong’s 2010 Tour de France race and a branded line of helmets, also quit Team Armstrong, along with the Honey Stinger brand and, as the Wall Street Journal reports.

Given the above scenario, what are the major lessons brands custodians can learn?

Live a ‘transparently honesty’ life: if the reports of the USDA(Us-Anti-doping Agency) is anything to go by, it is obvious from the pages of report that Lance Armstrong might possibly used performance enhancing drugs during his career. The only exception is that if he was not aware some of the drugs he used then had banned substance. At least, a come-back Olympic gold-medal athlete had claimed this before. It is obvious today that no matter how fast lie travels, truth will catch up with it soon. Technology keeps improving and keeps exposing weaknesses in our long held positions. Brands must walk with consciousness of an open hand.

Keep doing good: everyone knows Lance Armstrong fortunes will dwindle fast now. But the only sympathy people still has for Armstrong today is the impact his cancer-fighting charity has had on those it had touched. Nike Inc. has promised to keep its support for LiveStrong foundation. When a brand is committed to doing good, it can gain a little sympathy in the days of crisis.

Acknowledge your mistake: We live in an age of make-believe. Because of image issue, some brands still want to live in the facade of old glory when everything is pointing otherwise. Brands must never forget lawyers are professionals who want to make their money. So, sometimes Lawyers’ advice to their clients may be against the truth. It is high time we break the jinx, when it becomes obvious you are in the wrong, acknowledge it fast. This may not look sexy but it holds a future. Our calculation is that may be if Armstrong had acknowledged this earlier, Nike inc. might have understood his position after all some of its other spokespersons with some sort of ‘scandals’ had been retained.

There are other issues involve, can you add your thoughts?

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