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Tag Heuer Tennis Nike

Break point for Brand Sharapova

By Adam Wood, Senior Account Executive

March 9, 2016 | 5 min read

Nike, Tag Heuer and Porsche are some of the brands who have called time on their sponsorship deals and affiliation with tennis superstar Maria Sharapova, following her failed drugs test announced on Monday.

According to Forbes, Sharapova has been the highest-paid female athlete in the world for 11 years in a row, earning $29.7 million in 2015, including $23 million from endorsements and appearances. That all looks about to change. For now, Brand Sharapova faces going bust.

If you look into the details of the failed test, you might have some sympathy for Sharapova; a sign of how well the star and her management team at IMG have handled the issue. Sharapova was informed of her failed test last week. Wasting no time, Sharapova called a press conference for Monday, likely following hurried conversations behind the scenes.

Crucially from a PR perspective, her announcement came before any news or punishment from the WTA itself. In doing so, Brand Sharapova has done its best at containing and controlling the issue, as well as avoiding the potential for leaks and speculation should they have tried to keep the news under wraps for longer.

You need only compare this to other high profile drugs cheats in the media to see how well Sharapova has played the part. Lance Armstrong, perhaps the most prolific cheat in sporting history, did his best to bully fellow competitors and discredit any media who questioned his activities, all the while continuing to benefit from multi million dollar endorsement and sponsorship deals.

The result when the truth came out? A period of intense speculation, carried out across the media and social networks, legal wranglings and an ignoble banishment from the spotlight. It’s still early days for Sharapova, but the way in which her drug use has been announced, it doesn’t look like she’s heading the same way.

Sharapova has owned up to her error from the outset: "I did fail the test, and I take full responsibility for it” she announced at the press conference on Monday. In doing so, Sharapova has eased the pressure faced by her sponsors. Big name brands like Nike know that being associated with a figure facing intense media scrutiny for the wrong reasons doesn’t reflect well on the business.

Over the past four years, it has severed deals with Lance Armstrong, running back Ray Rice, running back Adrian Peterson, sprinter Oscar Pistorius and boxer Manny Pacquiao. Whilst the situation for Sharapova is still developing, there would still appear to be hope if you compare the comments made by the sporting behemoth for previously terminated contracts:

“We find Manny Pacquiao’s comments abhorrent. Nike strongly opposes discrimination of any kind and has a long history of supporting and standing up for the rights of the LGBT community. We no longer have a relationship with Manny Pacquiao.” - Nike, following Pacquiao’s derogatory comments around same-sex couples.

“Due to the seemingly insurmountable evidence that Lance Armstrong participated in doping and misled Nike for more than a decade, it is with great sadness that we have terminated our contract with him.” - Nike, following the Armstrong scandal breaking

"We are saddened and surprised by the news about Maria Sharapova. We have decided to suspend our relationship with Maria while the investigation continues. We will continue to monitor the situation." - Nike on Maria Sharapova’s performance enhancing drug use

A ‘suspension’ as opposed to ‘terminated’ contract. ‘Saddened and surprised’ rather than finding her actions ‘abhorrent’. Only time will tell if sponsor statements see sterner words used, but it already looks like damage control for Brand Sharapova has gotten off to a good start.

Sponsorship deals involve big bucks for sports stars and the brands who provide them. Last year Nike made headlines when it signed a lifetime sponsorship deal with basketball megastar LeBron James. Pundits estimate the deal could be worth anywhere between $500 million and $1 billion. But such a deal, in a post-Armstrong and now post-Sharapova world, raise questions on the risks involved for brands. When relationships sour, it’s not only revenue at risk, but reputation. Let’s not even mention any of the ‘Facts’ of Nike and Kanye West’s dealings.

From a PR standpoint, Sharapova has done a great job of managing the news so far. But like Nike, we’ll continue to monitor the situation - it’s not game, set, match just yet.

Adam Wood is a senior account executive at Eulogy

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