Fifa have handed Suarez the longest ban in World Cup history which will see Suarez barred from all ‘football related activity’ for a period of 4 months. The ban is the biggest in World Cup history, beating the eight games given to Italy’s Mauro Tassotti for elbowing Spain’s Luis Enrique in 1994.
Suarez is not the first athlete to land themselves in hot water with sponsors; Tiger Woods and Lance Armstrong lost many of their headline sponsors following the former’s infidelity and the latter’s doping indiscretions. The actions of Nicolas Anelka and the now infamous ‘quenelle’ goal celebration saw Zoopla end their sponsorship of West Browich Albion. So what can sponsors do to shield their brand against the unwanted actions of the players they sponsor?
Most sponsors attempt to proactively protect themselves from foreseeable breaches of ‘Morality’ by having their legal advisors draft specific clauses into their sponsorship agreements with an athlete. ‘Disrepute’ or ‘Morality’ clauses are brought into play by a triggering event which brings the individual, club and / or sponsor into disrepute, or if an athlete’s behaviour falls below expected levels of morality.
Coca-Cola had the foresight to construct such a clause under which Lance Armstrong provided contractual warranties assuring Coca-Cola that he was free from performance-enhancing drugs. When the US Anti-Doping Agency announced that Armstrong had led “The most sophisticated, professional and successful doping programme sport has ever seen”, Coca-Cola were able to terminate their deal with the 7-times Tour de France winner without recourse to Litigation. In contrast the insurance company SCA Promotions are locked in a legal dispute with Armstrong’s legal team in an effort to recoup $12m in bonuses which the firm paid out for his wins between 2002-2004.
The question for the current sponsors of Luis Suarez will fall down to the 4 P’s; profits, publicity, perception and poaching. Will the actions of Suarez see a loss in revenue for the sponsors? When Kate Moss was photographed using drugs, a lot of companies terminated their sponsorship contracts with her. However, less than a year later she had signed many new lucrative sponsorship contracts. The old saying that there is no such thing as bad publicity is certainly apparent in the aftermath of the biting scandel. Could it be argued that 888poker have received more publicity than they could ever have envisaged by publicly dropping Suarez as an ambassador of their brand? They were the first sponsor out of the blocks to denounce the actions of the Uruguayan. They have enjoyed raised awareness of their brand over the world cup period, signing Suarez as an ambassador in the lead up to the finals in Rio and then the social media exposure when they dropped Suarez. 888poker have made a clean-break from the player and will not have to continue paying huge sums of money to use the player’s name.
All the sponsors will have received greater publicity from the incident but the question the sponsors will ask themselves is, what is the public’s perception of their brand in light of the actions of the player? The racism allegations of Suarez’s past surely overshadow biting a player on the pitch but the sponsors have stuck by the Uruguayan. Sponsors may perceive if they stick by an individual through the bad times and they turn themselves around that will have more value with the public. The story of David Beckham is living proof. Many sponsors would have questioned their association with the midfielder following his red card in the France ’98 world cup but who would not want to be partnered with the global phenomenon of brand Beckham 16 years on? So finally poaching; Adidas must be talking behind closed doors that if they drop Suarez will their fierce rival Nike snap up the striker straight away and enjoy the fruits of Suarez’s onfield success. His performances last season and at the World Cup prompted footballing giant Barcelona to put together a deal worth a reported £75m to coax the star away from Anfield.
(This blog was originally featured on the BPP Law School website as a guest blog. Please click the link here http://shout.lt/w3fw.)
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