Ryan Lochte … when sponsorship goes wrong


As the Olympic swimmer’s reputation took a dive, his sponsors were quick to distance themselves. Charlotte White, strategy partner at Carat asks whether this was a clever response – and what are the lessons for advertisers?

Sponsorship Rio 2016

As Olympians return victorious from Rio 2016, it’s likely that many will be offered lucrative sponsorship packages from brands eager to harness Olympic glory. As advertising is increasingly avoided and ways of talking to consumers proliferate, celebrity sponsorship is set to continue its meteoric growth.

If it works, the sponsorship route can cut through the clutter of today’s marketing. Take Dove’s association with the Wales rugby team. Dove Men+ Care’s Twitter account has 32.4k followers; meanwhile Wales International’s George North has an impressive 325k. So when he tweets “Thanks Dove Men+Care” alongside a picture of the product (as he did only recently), the brand not only gains far more exposure, but the message is delivered through a trusted, respected source, meaning it’s likely to have far more impact.

However, this kind of endorsement very much relies on the integrity of both parties. Earlier this month, for example, the Kardashian clan was called out by nonprofit consumer group Truth In Advertising (TINA) for failing to indicate that over 100 product placements on their Instagram accounts were actually paid for. In this case, both the Kardashians and the brands in question neglected to disclose their commercial relationship, proving that trust needs to go both ways in influencer marketing.

Of course, the Kardashians aren’t the only brand ambassadors to compromise their integrity. When it was revealed last week that US Olympic swimmer Ryan Lochte had lied about being robbed at gunpoint, several brands were faced with a major trust issue, ending in the retraction of lucrative sponsorship deals including Speedo and Ralph Lauren, reported to have been worth an estimated total of $1m (£758,000). Speedo quickly disassociated itself from Lochte when his misdemeanours were exposed, saying: “We cannot condone behaviour that is counter to the values this brand has long stood for.”

This situation, of course, isn’t new; from Pepsi’s withdrawal of its Michael Jackson sponsorship to Chanel distancing itself from Kate Moss, celebrity association has always been a risky business. So what makes this incident with Lochte different?

In the past, messages could be carefully controlled and cultivated. Bad news could be hidden, rumours silenced by smart crisis PR teams. But in the age of digital democracy, where consumers are only ever three or four clicks away from finding out anything about a brand, mistakes will be outed. Through social media, consumers now influence opinion much more than any brand or institution. Mistakes are not only revealed, but rapidly amplified.

What has also changed is how the public responds to different types of misdemeanour. Brands need to take note – and monitor this on social media – before diving into kneejerk reactions, such as Speedo’s.

First, there’s the genuine mistake, which is almost always forgiven. Tennis star Maria Sharapova was given a two-year suspension earlier this year when it was revealed she’d failed a drugs test. Her major sponsors (Nike, Head and Evian) stood by her. When the failed drugs test came to light, Sharapova apologised for her mistake straight away, and her racket supplier Head emphasised how she was a “role model and woman of integrity”. The balance of social media agreed. By standing by Sharapova, Head actually improved its reputation. Had it not, it would almost certainly have been vilified for cowardice or lack of constancy.

The second level of misdemeanour is lying, which is the category Lochte falls into. From Bill Clinton to Tiger Woods, this is nothing new. What can now be observed, however, is that if the reason for the lie is explained and understood, if the perpetrator appears genuinely contrite, then the public can be remarkably forgiving. According to research by marketing technology company Amobee, who analysed over 600,000 sites, the majority of social comment around Lochte was actually neutral or even positive. So should Speedo have reflected public opinion, created a platform for Lochte to express his contrition and stood by him? Would that have made Speedo appear more human and more in touch with the public?

This leads us onto the third, and ultimate misdemeanour: hypocrisy. Brands need to tread carefully when it comes to “behaviour that is counter to the values this brand has long stood for”, as Speedo puts it. Hypocrisy is not tolerated by the public and rouses genuine feelings of anger on social media.

Conversely, what does generate criticism and a true breakdown of trust, is when celebrities or brands do act hypocritically. I wouldn’t be surprised to hear if there was now an army of citizen journalists trying to find out instances where Speedo has acted controversially. At the 2008 Olympics swimming records were being broken by improbable margins with the swimmers having one thing in common – FastSkin – one of Speedo’s performance–enhancing swimsuits; leading to the brand being accused of “technological doping”.

So was Speedo right to act so decisively and quickly? On the one hand, any delay would seem like tacit endorsement, but on the other, it’s now set a rod for its own back. Any future misdemeanour on its part will be seen as hypocrisy.

Perhaps the answer lies in a single word: humanity. To err is human, but forgiveness doesn’t require divinity, just the capacity to take a step back and listen. Social media may have hijacked brands’ ability to conceal the truth, but it has also given them the ability to listen to how the public is feeling and align themselves with public sentiment, which is a powerful tool.

This article first apeared in the Guardian on 01/09/16

Sponsorship Rio 2016
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