Nike has experienced some bumps in recent months. The company dropped Kyrie Irving, Ja Morant is going to counseling after waving a gun on his Instagram Live account, and Curbed recently published an expose on Nike collaborator Tom Sachs.
But none of this is new. When companies give endorsement deals to celebrities, there is a chance the deal will end on bad terms.
Coresight Research CEO and founder Deborah Weinswig spoke about celebrity endorsement deals during an interview with Insider.
“I’ve always not been a fan of celebrity deals. You do need that halo, but don’t bet the ranch on one athlete.”
Weinswig added that companies should also include employees in their endorsement deals.
“It has to be a mixture of your own employees and celebrities,” she told Insider. “Every brand will find its own balance. That’s the right model for the future.”
Hitha Herzog, the chief retail analyst for Doneger Tobe, said that because social media makes peoples’ lives transparent, endorsement deals are now complicated.
“What the brands are not doing well is vetting who they are partnering with,” she told Insider. “You’re not just aligning on what two people do in terms of professional jobs,” she said. “In 2023, we have a lot of transparency, and there’s going to be a lot more transparency in the future.”
Matt Powell, a sportswear industry analyst, echoed Herzog.
“I thought for a while that brands were moving away from real celebrity endorsements,” he told Insider. “But there certainly have been a lot of high-profile issues lately. It’ll scare people off from doing more of these. The return isn’t there for brands today.”
Insider also reported that Michael Jordan’s deal with Nike is the gold standard, which has not been repeated. However, Serena Williams, who has a deal with Nike, as well as Steph Curry, and Tom Brady, who both signed deals with Under Armour, have shed light on an entire brand.
“You can argue LeBron is the face of Nike today, and his reach is much more than the sales of his shoes. At the same time, people are having to spend tons and tons of money, and they’re not really getting the return on it,” Powell told Insider.