It’s All About Brands: How Endorsement Deals Have Changed Sports

COMMENTARY

By Maci Weeks

What does it mean to have the fastest man alive in your shoes? Or the greatest golfer in the world in your clothes? How much are those athletes worth, to their teams and these brands? 

Endorsement Deals

“Bro, we don’t play for the school. We don’t play for each other, and we won’t be playin’ for our pro teams. We play for the brands. Cause at the end of the day, that’s who’s gonna be payin’ us.”

–Amateur, 2018, Netflix Movie 

Let’s admit it, pro athletes these days always look fresh. Whether that be at practice, or in a game, these athletes are dressed in top-notch athletic wear. But have you ever noticed each getup is head to toe of the same brand… and it’s ALWAYS all the same brand. That’s because companies will shell out millions of dollars in order to have their partner athletes, who are often biggest names in their respective sports, constantly rep their brand. The theory is the bigger the icon, the bigger the sales. Check out the length some brands are willing to go in order to get the top athletes as the face of their brands.

1. Lakers mega-star Lebron James was offered a $15 million check by Reebok just to not meet with Nike and Adidas when he was 18. He turned it down, and now as a 33-year-old, he has a $1 billion minimum lifetime contract with Nike.

2. Argentinian soccer star Lionel Messi is the second highest paid athlete in the world. He makes $27 million dollars from his endorsement deal with Adidas each year and also makes $80 million from his team. According to Man of Many, by the time you’ve read this short article, he will have made $520 doing nothing.

3. Roger Federer is a 20-time Grand Slam winner, and arguably the greatest tennis player of all time. His new endorsement deal with Uniqulo, which paid him out of his $150 million  Nike deal, is worth $300 million over the next ten years.

4. Tiger Woods only receives a golfing paycheck if he wins. In 2018, only 10% of his income was due to prize money, while he earned $1.5 million from various sponsors.

5. Soccer superstar Cristiano Ronaldo is one of the most widely known faces in sports. While people like Lebron dominate in the US and some European companies, Ronaldo dominates worldwide. He also has a $1 billion dollar contract with Nike and is also endorsed by Herbalife, EA Sports, and American Tourister.

6. Steph Curry, a big name in basketball the last three years, and one of the best shooters in the current game has a $42 million deal with Under Armour. Curry’s deal is the fourth largest endorsement deal globally.

When we look at each of these players and their deals, we can find an interesting fact.
Lebron makes $35.65 million from the Lakers in a year… but he makes $55 million from endorsement deals each year.
Feder makes $12.2 million from playing tennis in a year… but makes$ 65 million from endorsement deals each year.  Tiger woods makes just $1.3 million from actually golfing in a year…but makes $42 million from endorsement deals each year.
Cristiano Ronaldo makes 30 million from Juventus in a year… but makes $35 million from endorsement deals each year. Steph Curry makes $34.9 million from the Warriors in a year… but $42 million from endorsement deals each year. The stand-alone athlete who makes more from his actual gameplay is Lionel Messi who makes $80 million in salary, but only $27 million in endorsements.

 

Me vs. We

When looking at the above statistics, we find that there is only one player of six most highly paid athletes that makes more from his actual play then from endorsement deals. This poses an interesting question…are players loyal to their teams and fans, or loyal to the brands that endorse them?
As endorsement deals begin to skyrocket, we see the focus on the individual player instead of on teams. While there are pay caps in nearly every sports league, there are little to no restrictions on what a company can pay for a player. This has created a rise in the celebrity athlete. For example, in 2013-2016 Dwayne Wade took large pay cuts to allow Chris Bosh and Lebron James to be brought onto the Miami Heat. While Wade made less and less from his team, the Big Three became an icon, and Wade landed more endorsement deals than ever. While he was only making $15 million from the Heat, he made $20 million off of endorsements in 2016. The more Wade’s name was in the spotlight, the more money he made. 

Bosh and James also signed significant deals that year, and while the Heat entered the finals three times in a row, most people could not name the other two starters, let alone any bench players. The Big Three was who the Heat spent time advertising, and who brands spent time paying. Wade is not the only case of a rise in fame correlating to a rise in endorsement deals. Curry had significant deals with Under Armour AFTER he won a ring. James Harden signed a $200 million shoe contract with Adidas AFTER being named the Player’s Choice MVP. Naomi Osaka signed an $8.5 million deal with Adidas just days AFTER defeating Serena. The more a player is in the spotlight, the more opportunities they have. For example, people think Russell Westbrook has changed his style of gameplay with the OKC Thunder since Kevin Durant left the team in order to become a more popular player and climb the endorsement deal ladder. Instead of being a team player, many believe him to be a ball hog. However, Westbrook won the league MVP in 2018, and that same season signed a contract with Nike and Jordan that was Jordan’s biggest to date. So, while Westbrook may not have been making his team look good, he made himself look good… and it paid off.
Of the 13 most lucrative brand deals in history, only one (Michael Jordan partnering with Nike to create the Air Jordan line) occurred before 2000. Furthermore, just four deals occurred before 2008. It is clear that brands continue to be willing to pay more and more for athletes to partner with them. With each signature at the bottom of a deal, sports become less and less about the team and fans, and more and more about the pleasing the brands. Players need to earn the money these companies are shelling out and stay in the limelight to do so. This can create a toxic environment, as statistics and individual plays become more important than a team win. Until there are restrictions set on brand payments, endorsements will continue to become more and more important to athletes, and sadly “me over we” mentalities will continue to develop.

 

#nike #adidas #uniqulo #athletics #brands #endorsement

 

All pictures can be found on the corresponding company’s website.