The Rise Fall and Rise Again of the Sharapova Brand

The Rise

Maria Yuryevna Sharapova is a Russian professional tennis player, Sharapova’s tennis success and appearance have enabled her to secure commercial endorsements that greatly exceed the value of her tournament winnings. In March 2006, Forbes magazine listed her as the highest-paid female athlete in the world, with annual earnings of over US $18 million, the majority of which was from endorsements and sponsorships. She has topped that list every year since, even after her 2007 shoulder injury.

Initially her contracts were Japan-only so they didn’t affect the global brand she was building. Those deals included Pepsi and Honda, even though Sharapova did not have a driver’s license at the time. Sharapova signed just one global deal, with Motorola, which was poised to launch its popular Razr line of mobile phones. That deal stemmed directly from Sharapova’s match with Williams: after her 2004 victory, she tried to phone her mother on court, but her unbranded cell phone wouldn’t work.

Everything she has is because of this 2004 win at Wimbledon,” says Max Eisenbud, the agent who has guided Sharapova through contracts, deals and endorsements since she was 11.

Sharapova’s endorsements include, Land Rover and Canon, as well as approved of namesake items by watch brand Tag Heuer and jeweller Tiffany. During the layoff due to her shoulder surgery, Sharapova focused on developing her name as a brand. In January 2010, it was announced that Sharapova had renewed her contract with Nike, signing an 8-year deal for $70 million. This is the most lucrative deal ever for a sportswoman, dwarfing the previous record, which was Venus Williams’ $43 million deal with Reebok.

Following in the footsteps of tennis players who started clothing lines such as Fred Perry and René Lacoste, Sharapova launched her own tennis apparel line, the “Nike Maria Sharapova Collection”. Additionally, she designs shoes and handbags for Cole Haan, for which her signature ballerina flats are one of the biggest sellers of the entire brand. Sharapova began endorsing Head racquets in 2011 and. signed a three-year deal to be brand ambassador for Porsche in 2013. A spokesperson at the German automaker says Sharapova helps them reach new target groups like women and younger Porsche drivers. “Maria is an exceptional athlete,” she says. “She combines top performance in her sport with elegance and power. These are precisely the qualities that are embodied in our sports cars.”

The Fall

On March 7, 2016, Sharapova revealed that she had failed a drug test at the 2016 Australian Open, which she described as the result of an oversight. Sharapova admitted to testing positive for Meldonium, an anti-ischemic drug usually prescribed for heart conditions, that was added to the World Anti-Doping Agency (WADA)’s banned substances list on January 1, 2016.

Following the announcement, as a result of the failed drug test, personal sponsors Nike and TAG Heuer suspended their respective relationships with Sharapova, while Porsche postponed promotional work. The United Nations Development Programme suspended Sharapova from her role as a goodwill ambassador on 16 March, while expressing thanks for her support of their work over the past nine years, in particular around the Chernobyl nuclear disaster recovery.

Meldonium, trade-named as Mildronate

While Sharapova clearly broke the rules she was not alone. The World Anti-Doping Agency has recorded 99 positive samples with traces of Meldonium between January 1 and March 10 2016.

Quite why Meldonium was placed on the banned lists also remains something of a mystery. Forbes reported that anesthesiology professor Michael Joyner, at the Mayo Clinic in Rochester, Minnesota, who studies how humans respond to physical and mental stress during exercise and other activities, stated that “Evidence is lacking for many compounds believed to enhance athletic performance. Its use has a sort of urban legend element and there is not much out there that is clearly that effective. I would be shocked if this stuff (Meldonium) had an effect greater than caffeine or creatinine (a natural substance that, when taken as a supplement, is thought to enhance muscle mass).” Ford Vox, a U.S.-based physician specializing in rehabilitation medicine and a journalist reported “there’s not much scientific support for its use as an athletic enhancer”.

The Rise Again

“Athletes are humans just like the rest of us.”

The first signs of survival appeared when racquet manufacturer HEAD stood by Sharapova, saying, “We look forward to working with her”, and announced that they intended to extend their contract. HEAD also suggested that WADA should prove scientifically why the drug should be banned.

Nike which suspended ties with Sharapova after she failed a drug test, believes disgraced athletes can redeem themselves, global brand head Trevor Edwards said in an interview. “Each time those situations happen, you are saddened and disappointed,” Edwards said on March 16th 2016 at a New York event where the world’s biggest sportswear company announced new products like self-lacing shoes. “At the same time, there are many athletes that inspire us.”

However, Edwards hinted Sharapova could return to the Nike fold, as the company allowed U.S. sprinter Justin Gatlin to do after he twice served doping suspensions.

Asked about Sharapova, he said: “At the end of the day, athletes are humans just like the rest of us, and they have the same frailties that the rest of us have. And sometimes those moments become teaching moments.”

At 6'2" plus heels Sharapova is an imposing presence.

Anita Elberse, a professor of marketing at Harvard Business School, who teaches a case study on Sharapova every year, says there is a dearth of marketable female athletes. “In the world of tennis there is Maria, the Williams Sisters and then the list almost stops already,” she says. “That gives the ones that are on that short list enormous power. They have even more opportunities to benefit from their position. Endorsers like Sharapova can influence the bottom line. Elberse has found that a firm’s decision to sign a celebrity, particularly an athlete, as an endorser leads, on average, to a sales increase of 4%. “That’s a significant sum of money,” she says. When athletes win important tournaments or championships these same firms see a boost in both sales and stock prices. “So if you have a consistent performer like Sharapova who is constantly a contender there is a strong payoff for the brand.”

Sharapova is a fighter, known on court for her mental resilience and although she is not out of the woods yet, there are clear indications that once she has served her ban (the length of which is still to be determined) her sponsors will embrace her once again and the Sharapova brand will ultimately be as valuable as ever. Sharapova will celebrate her 29th birthday on April 19th, time is very much on her side.

First posted by Adrian G Stewart at OOKII.Company

Adrian G Stewart

Adrian G Stewart

About adriangstewart

Senior executive with expert knowledge of all aspects of strategic marketing and a track record of creating sustainable competitive advantage. International management and leadership experience in both B2B and B2C organizations. Specialties:Strategic marketing management including; new product development, product life cycle management, business relationship management, market segmentation, marketing information systems, e-commerce and social media marketing.
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