I’m watching the Wimbledon semifinal now, and they mentioned that if Andy Murray wins the tournament, he could get endorsement contracts in excess of 100 million pounds. I’m having a hard time believing that an athlete’s endorsement is really worth that much. Sure there are big successes once in a while, like Air Jordan, but do enough people really buy a brand of goggles, razors, cereal, or whatever just because it comes with the picture of a sports star to justify the tens of millions of cost?
Apparently the folks who are willing to shell out that kind of money think so.
I think it takes away from the value of the product. I would rather pay for better leather, workmanship, better shoe strings. If the cost of the shoe includes millions for an endorsement then that’s not making a better shoe. I wear New Balance which doesn’t have any spokesmen and is a fine shoe for less than $50.
It works the same for cars. If GM’s CFO’s are making 3 times as much as Toyotas and both models are selling for the same price who’s car do you think has better quality parts in it.
Works for kids. When I was young everybody wanted the shoes like the local star BB player wore.
I have heard that this kind of endorsement was the making of a show company, I think Nike. Whether having sports stars endorse, say, Wheaties, is another matter and I cannot imagine it makes a serious difference. But then they say any publicity is good.
Do you really think major corporations don’t do market research to see whether or not celebrity endorsements are effective? They pay Tiger Woods and Michael Jordan all that money because it comes back to them ten fold.
See, I get it for Michael Jordan and Tiger Woods, who I can definitely tell you wear Nike products.
However, most people would not be able to tell you that Andy Roddick wears Crocodile or that his Raquet is Babolet, who pay him to play with their raquets.
No idea how much they pay him for those things, but it only is widely known by die-hard fans, which can’t increase their sales much.
Well, I’m not actually sure they do. And if they do, that it is perfectly accurate. It seems like a difficult thing to quantify. Anyway, I mentioned Jordan in the OP. As Mahaloth said, it’s entirely believable that MJ and Woods make money for Nike. But whether they’re worth it for other companies, and whether lesser known athletes are worth tens or hundreds of millions in endorsements and sponsorships, I’m not so sure.
Only the tennis fans would - and presumably they are the ones that are being targeted in this case.
Golf seems to be among the most expensive when it comes to sports endorsements, but do pros really play with off-the-shelf equipment from Ping, Cleveland, and so on? From what I understand, clubs used by pros are all custom-made.
From what I understand, celebrity endorsements for some types of products are actually associated with cheaper, less professional goods in the minds of the target market; for example, cookware. If a pro endorses a certain brand of golf equipment, all the weekend golfers flock to it. However, if the name of a television chef appears on some pots and pans, foodies avoid it.
Professional golfers have to use equipment defined as performing by either the USGA or RGA. Given that, they pretty much have to use either off-the-shelf equipment or brand-new stuff that has passed such certification but hasn’t yet reached the public. (I seem to recall Tiger Woods using a conforming, but not-yet-available golf ball for awhile.)
Of course, their equipment is typically (and legally) custom-tweaked by the manufacturer’s reps for them. “Would you like the loft of that seven iron bent to be reduced by a half degree, Mr Woods? And the lie made, say, half an degree flatter?”. (Note that we weekend hackers can legally get our clubs modified the same way and still have them be conforming. Most of us don’t, though, because it’s just not worth it given the state of our game.)
And it’s in the golf equipment manufacturer’s self-interest to have identical equipment available for sale to the average hacker like me. “But honey, this $600 driver is the very one that Phil Michelson uses! It’s got to improve my game significantly!”
NASCAR says you can’t race a car that is not sold to the average Joe. But these days that is really a joke, they just call the car a Camry or Fusion, etc. when it is nothing like that.
Keep in mind that if the company is going to advertise anyway, it’s not a matter of spending money on a celebrity endorsement versus simply saving it. It’s a matter of whether or not the total cost of an endorsement ad is a worthwile use of advertising budget versus some other type of ad. I suspect that apart from the money paid to the celebrity, production costs on endorsement ads are relatively cheap - just some shots of the celebrity using your product, then cut to them blathering about how wonderful it is. As opposed to something requiring special effects, large crews or involved setup.
I think partly it comes down associating a company with a sport; e.g., before Tiger, Nike was not a “golf company”. I’m not sure if the same was true of Jordan and basketball.
When Woods first starting using Nike golf stuff many people said it was crappy stuff and he was the only guy good enough to use it and win.
The figure of £100 million for Andy Murray is an estimate of his total potential earnings over the rest of his career if he wins Wimbledon and (presumably) goes on to a successful career involving several other Grand Slam wins.
Such a career could amass prize money of over $50 million. Top players also receive appearance fees for certain tournaments (easily into the hundreds of thousands of dollars for Dubai, for example).
The other thing to bear in mind is that the £100m figure comes from, I believe, Max Clifford, who often makes these kind of pronouncements of potential earnings, accurate or not, when a new celebrity emerges (e.g. Susan Boyle) or a sports star stands on the brink of glory.