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How Will Sponsors React To Lance Armstrong Confessional?

Advertising Age, January 17, 2013

By Michael McCarthy

What did Lance Armstrong's corporate sponsors know about his doping — and when did they know it?

That question is hanging over his former endorsement partners as they wait for Oprah Winfrey to televise her two-part confessional interview with the disgraced cyclist on her OWN network tonight and tomorrow.

Nike has been the only company to publicly broach the issue of whether it knew anything about the cyclist's performance-enhancing-drug use. When Nike terminated Mr. Armstrong on Oct. 17, the Swoosh stated he'd "misled" the athletic giant for "more than a decade."

Within hours, Mr. Armstrong's endorsement empire fell apart as Anheuser-Busch, Trek, Easton-Bell Sports, 24-Hour Fitness, Honey Stinger, Oakley and other firms dumped the cancer survivor, even as some pledged to continue support of his Livestrong Foundation.

But who knows what a cornered Armstrong will allege during tonight's interview on OWN (9 p.m. ET)? Ms. Winfrey said she came prepared with 112 questions for the interview with Mr. Armstrong, taped Monday at an Austin hotel. Advertising Age asked OWN spokeswoman Chelsea Hettrick if any of those questions concerned sponsors. She declined to comment.

"I'm sure it's something [Armstrong's ex-sponsors] have talked about behind closed doors," said Jim Andrews, senior VP of sports sponsorship and research firm IEG. He said sponsors must be asking themselves, "'Is there a possibility he might say this? And what would our response be?'"

The U.S. Anti-Doping Agency said in October that an "army of enablers" inside and outside cycling helped Mr. Armstrong create the most "sophisticated, professionalized and successful doping program the sport has ever seen."

But unless Mr. Armstrong has strong evidence, such as emails indicating an executive knew he was doping and helped cover it up, then it would likely be his word against the sponsor, Mr. Andrews said.

Mr. Armstrong's crisis PR expert, Mark Fabiani, did not return calls for comment.

Depending on wording in the contracts, sponsors could also sue their former star endorser to try to get back millions in endorsement fees, said Michael McCann, a sports-law expert at the University of New Hampshire and contributor to

"Generally speaking, if there's fraud, a party can claim later on they were damaged by fraudulent conduct," said Mr. McCann.

But would a lawsuit be worth the bad publicity? That's a tougher call, Mr. McCann said.

"I'm not sure any are going to do it. Right now it's more of an idea than a likely outcome. But it really depends on what he says tomorrow night. Who knows?"

Ad Age canvassed most of Mr. Armstrong's ex-sponsors Wednesday to check if any legal action was in the offing. The only one to answer the question was Honey Stinger, a small health-foods company in Colorado.

"We do not have plans for any legal action," said spokesman Len Zanni, who added Honey Stinger is in the process of removing the image of the 7-time Tour de France winner from product packaging.

Crisis PR expert Mike "The Reputation Doctor" Paul thinks Mr. Armstrong truly believes he'll overturn his lifetime ban from Olympic sports and resume his lucrative career as an athletic endorser.

That's not far-fetched: TMZ asked Nike CEO Phil Knight if there's a chance that Mr. Armstrong will "reunite" with the Nike brand. "Never say never," replied Mr. Knight in the video clip. And yes, he will be watching tonight, he said.

Nike spokesman Brian Strong said Wednesday that the Swoosh's athletic position on Mr. Armstrong remains unchanged since its statement in October.

Mr. Paul thinks the cyclist is cynically using the platform of the OWN network for "the wrong reasons," not because he's truly repentant. "Lance is doing this because was caught. Because he's trying to salvage a reputation. So he can still be associated with the lights, with the cameras, with a career."

Americans are forgiving of misbehaving celebrities. But Mr. Andrews believes that Mr. Armstrong's chances of making a Tiger Woods or Kobe Bryant-like comeback on Madison Avenue are slim and none.

His cheating, and subsequent personal attacks on whistleblowers who testified to his PED use, go to the heart of his cycling achievements, Mr. Andrews said. Messrs. Woods and Bryant, on the other hand, got in trouble in their personal lives.

Rather than Mr. Woods, a more fitting comparison for Mr. Armstrong would be Barry Bonds, baseball's all-time homerun leader who's a virtual pariah in the sports, media and marketing worlds.

"No mainstream brand with any credibility is going to want to associate with [Armstrong] at this point," Mr. Andrews said. "The only exception might be a company on the fringe looking to generate some crazy publicity."

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