Will major brands still turn to Steve Smith and the Australian Cricket Team in the future?

Steve Smith and co broke the rules and put not only their reputations at stake, but also the reputation of their country.

Once the “Weet-bix Kid”, Steve Smith is now most likely to be seen fronting campaigns for another of Australia’s well known brands, Bunnings Warehouse, selling sandpaper.

That self-mockery worked wonders for Gareth Southgate after his missed penalty in Euro ’96 for England, when he embraced his failure in adverts for Pizza Hut. But Gareth Southgate was playing by the rules, trying his best to win fairly for his country. Steve Smith and co broke the rules and, in doing so, put not only their reputations at stake, but also the reputation of their country.

Australia, and its people, are proud of their sporting traditions and their sense of honesty and fair play. Even their national anthem is called “Advance Australia Fair”. The “play hard but fair” mantra of Australian sporting teams, particularly their cricket team, is not only a key part of their sporting identity but also their wider national identity.

The identity of their sporting teams and the nation have happily gone hand in hand for decades, and this works wonders when both are riding high, but when one falters it indelibly affects the other.

The recent ball tampering scandal expectedly led to worldwide headlines on the back pages, but also caused front page scandal. And even the Australian Prime Minister, Malcolm Turnbull, was forced to comment not only apologising for the impact on the game of cricket which he described as “a game that is synonymous with a fair go and fair play”, but also describing the impact on the nation, saying it was “a shocking affront to Australia”.

It is interesting to note that he was not talking about the impact on the Australian cricket team, but on the nation as a whole. And the Australian trade, tourism and investment minister, Steven Ciobo, admitted that the ball tampering scandal was discussed with UK Trade Secretary Liam Fox during a meeting on post-Brexit trade agreements.

Both the players involved, and the Australian cricket team as a whole, have suffered direct financial consequences as a result of the scandal, with several sponsors terminating their deals:

Weet-bix manufacturers Sanitarium have dropped Steve Smith as one of their ambassadors, saying “Weet-Bix ambassadors represent our brand values of trust and integrity, and they speak to everything that is good about being Australian” and that their relationship with Steve Smith could not continue as the role of the “‘Weet-Bix Kid’ is to inspire millions of Aussie kids to be the best they can be.” Commonwealth Bank also cut ties with Steve Smith, previously a sporting ambassador.

Magellan Financial Group has ended its sponsorship of domestic test-match series after just one year of a three year deal, saying “Regrettably, these events are so inconsistent with our values that we are left with no option but to terminate our ongoing partnership with Cricket Australia.”

Qantas suffered potentially the biggest loss in terms of reputational damage, saying the actions were “not acceptable to the rest of the world”. Not only did the association as the major sponsor of Cricket Australia mean that its logo was seen on news stations and in newspapers in association with the scandal and the players involved, but the scandal also coincided with the introduction of its new non-stop route from London to Perth, taking the gloss off this major launch.

Qantas suffered a second negative association with an Australian sporting team, after Israel Falau, a key player for the Australian Rugby Union team which Qantas also sponsor made negative comments on social media about LGBT+ people. Qantas was again forced to make statements to defend its brand and disassociate its brand values from those of the people and teams that it sponsors.

Qantas has been a vocal supporter of same-sex marriage in Australia and the comments made by Falau were therefore not only out of line with the Qantas message, but starkly opposed to it. In a statement, Qantas attempted to make clear what their position was in terms of values: “as a sponsor of Rugby Australia, we’re supportive of their approach towards tolerance and inclusion, which aligns with our own. We’ve made it clear to Rugby Australia that we find the comments very disappointing.”

John Illsley, branding specialist and commentator at Moore Stephens with close family ties to Australia says: “Brands benefit significantly from the additional exposure they receive from sponsorship deals and having brand ambassadors, but the risks involved are greater than just the financial investment in sponsorship deals. Synergies either naturally exist or are created between the brand values of companies and those individuals and teams that they choose to promote them. The behaviour of these individuals and teams must therefore be seen to be in line with the brand values of the company. Brands don’t want to be lampooned in the public space for support for disgraced celebrities or teams.”

John goes on to add that when Brazil lost 7-1 to Germany in the semi-finals of their home World Cup, there were question marks over damage to ‘Brand Brazil’. And that was just losing a game of football, albeit getting badly beaten. This is on a completely different scale. Australia, at least in the short term, can no longer be associated with fair play.

The damage is not only to its sporting teams, but to those commercial sponsors who have chosen to link their values to the value of these teams, and to the wider national identity. We have all seen brands recover from knocks in the past, but this will take a sustained effort to bring the Australian public back on side.”

In the symbiotic world of sponsorship, one party is always reliant on the actions of the other. The hope is that both sides pull each other up, rather than one side pulling the other down. Qantas and the other sponsors have benefited from Steve Smith’s and the Australian cricket team’s good form and good standing in recent times, particularly in their convincing Ashes win, but their association has turned sour. Strong statements have been made by Cricket Australia and the sponsors to try to minimise the damage, but it could be a longer road back for the players involved. There is a difference between being associated with a scandal and being the cause of it.

Time will tell if Steve Smith can follow in the footsteps of Gareth Southgate who went from national villain to manager of the national football team, though this journey took 20 plus years.

Will major brands want to be associated with Steve Smith and the Australian Cricket Team in the future? Much will depend on how well they are doing on the pitch, as we all know that brand value is fickle and brands are keen to be associated with winners, as long as they don’t cheat to win.

David Rogers is a senior manager in the corporate finance team at accountancy firm Moore Stephens.

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