Testing times for Ronaldo and his sponsors
Friday 5 October 2018
AS Cristiano Ronaldo’s sponsors start to put pressure on him over allegations of rape, Simon Chadwick, Professor of Sports Analytics at the University of Salford Business School, looks at what the impact could be and wider issues around brands using sporting stars for their marketing.
Professor Chadwick said: “These are testing times both for Ronaldo and for some of his commercial partners. In recent years, the Portuguese international has had to deal with issues at Real Madrid and with tax problems that resulted in him being fined and given a suspended jail term by Spanish authorities. His subsequent move to Juventus in Italy was viewed by some as being an opportunity to draw a line under these issues and start afresh.
“However, the allegations now being made against Ronaldo are causing new problems for him, not least in terms of the deals he has with the likes of Nike and EA Sports. Such partners will be concerned about the potential for a negative impact upon them, especially among key target audiences and given their respective marketing strategies. Nike in particular is likely to be nervous, as the brand has been seeking to distance itself from various problems over the last decade.
“The likes of Tiger Woods' indiscretions and Oscar Pistorius' conviction for murder (in both instances involving females), has resulted in Nike making a strategic commitment to equality and to woke marketing. EA Sports is likely to be equally as worried, as a significant proportion of its customers are children, and the company is doubt keen to maintain appropriate standards, as the potential for adverse consumer reaction is obvious.
“For Ronaldo himself, the lustre of his brand has probably already been affected by the allegation. This is a brand that has arguably been the last decade's pre-eminent athlete brand: in one report, it has been suggested that he has generated £800 million for sponsors; in another report, estimates are that Ronaldo is worth US$350 million. The longer this latest development continues, the greater the threat to his commercial strength. There is also the matter of Juventus too; Ronaldo's move to the Series A club has been much heralded in financial and commercial terms. Following his signing, £300 million was added to Juve's stock market value, while shirt sales following his signing hit a peak of £46 million per day.
“One suspects that officials inside the Italian club are likely to be concerned too hence, once suspects, the somewhat bullish communications now being issued by Juventus. Whatever the outcome of this matter, it clearly shows how complex sport has become, how important it is for athletes to maintain the highest possible personal standards at all times, and how the socio-cultural environment in which sports operate has changed dramatically over the last decade.”