AAL Commercial Awareness: Sharapova, steroids and sponsorship setbacks

Feb 10, 2018

Written By Jack J Collins, Editor, AllAboutLaw.co.uk

In case you’ve been living under a rock on Mars for the past month, the revelations that Maria Sharapova, tennis superstar, had tested positive for a banned substance, shocked the world of sport at the beginning of the month.

But, as the dust settles on the revelations, it seems as good a time as any to examine the claims Sharapova has made and how her sponsors have publicly reacted to the fact that the world’s top-earning female sports star is now a pariah.

The obvious place to start is with Nike, her biggest sponsor (Sharapova has an eight year deal with the sports brand that is worth $70 million, and that runs until 2018). She isn’t the first Nike athlete to get themselves into hot water however – in the past years they have dropped Lance Armstrong, Oscar Pistorius and Manny Pacquiao, after various revelations regarding their sporting or personal integrity.

Tiger Woods was also a Nike athlete, and whilst he was not dropped by the company, his deal was cut considerably following the revelations about his extra-marital affairs a few years ago.

As the biggest female athlete in the world, Sharapova retains some of her bargaining power, but pressure from the outside will tell as well. Nike have suspended their relationship with the star, and only time will tell if that relationship will be rekindled or not.

Nike refused to comment more than their original statement, which stated only that: "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."

TAG Heuer, the luxury watch brand, were less sympathetic. They stated that Sharapova had been under contract to them until the end of 2015, and whilst they had been in talks to extend this contract, they were suspending talks and would not be renewing it.

Porsche’s statements from the day they signed Sharapova and the day they suspended her are equally sad. In 2013 they stated that "Maria Sharapova is the perfect choice. Her profile and charisma are an ideal fit for Porsche. She is also highly respected around the world and enjoys an outstanding reputation."

On the day of her suspension, they simply said that: "We are saddened by the recent news announced by Maria Sharapova. Until further details are released and we can analyze the situation, we have chosen to postpone planned activities."

What’s perhaps most interesting about these statements is the speed at which sponsors hastened to distance themselves from Sharapova. Even following an emotional reveal where she gave valid reasoning and held her hands up to making a mistake, the response was swift and clinical from sponsors – ‘step away from the damaged goods.’

Even Nike, who stood by Lance Armstrong at the height of the doping debacle and Tiger Woods during his darkest hours, were swift to suspend the star. TAG Heuer, it must not be forgotten, signed an endorsement deal with Tom Brady last year, even after the Patriots were reprimanded for using underinflated footballs during games.

Experts have stated that with the latest ability of social media to ruin a brand’s reputation completely within minutes, companies are doing more and more to distance themselves from controversy in as quick a way as possible before they can be seen to be endorsing it.

Bob Williams, CEO of Burns Sports Marketing, told the New York Times that “If a company comes out and they’re proactive and they make a statement like that immediately, it removes the possibility of the spotlight being turned on them,” which goes some way to explaining the haste with which the sponsors hastened away from Sharapova.

It was slightly surprising then, that racket manufacturer Head did not follow suit. Instead, they took the unprecedented measure of extending their deal with her, based on the “honesty and courage she displayed in announcing and acknowledging her mistake.” They added that “Maria may have made a mistake, but she has earned the benefit of the doubt and we are extending it to her.”

Head also sponsor Andy Murray, who slammed them for such a decision, stating that he thought it was a “strange stance” given the revelations of the month. “I think at this stage it's important to get hold of the facts and let things play out, like more information coming out before making a decision to extend the contract,” he added. “Personally I wouldn't have responded like that.”

The rise in ‘break clauses’ being written into athlete’s sponsorship contracts is something that has been introduced following the scandals of the Tour De France, and has been stated as an absolutely essential tool for any sports lawyer who is representing a brand.

It will be interesting to see the final decisions of those ‘suspended’ sponsors when Sharapova’s final punishment comes in. Cheating in sport is obviously a horrendous crime and an insult to all those sportspeople who play the game fairly – but is there a line that must be drawn between unfair advantages and honest mistakes?

Commercial Insights