The only thing more consistent than Michael Phelps’s dominance in swimming over that last few years has been his Subway commercials. Few Olympic athletes are able to carry the success of their gold medals all the way from one Olympic games to the next. Usually one might see them around for about a year, then perhaps they fade until the next Olympics. But Phelps is no ordinary Olympian of course. In the lead up to the Olympics Phelps could be seen all over Subway commercials and then he seemingly disappeared, replaced by Robert Griffin III and Apolo Ohno. Where’s Phelps?
First, a little background. The Weakonomist loves swimming and was a bit of a chlorine junky years ago. But a bout of laziness and having the opposite build of an ideal swimmer (long legs, short arms, *ahem* somewhat round torso) lead to a career peak at “high school record”. But watching swimming can be quite boring for most viewers however somehow Phelps’s greatness has elevated the sport for everyone. As a result Phelps has picked up a lot of endorsements. In addition to Subway he works with Omega, Proctor & Gamble, Visa, and Speedo, among surely others. During the Olympics Subway is running tons of commercials, but Phelps is absent. Did he send out a bad tweet or say something stupid?
No. The Olympics have a monopoly on the rights to the athletes competing. That means to be called an “Olympian” you have to give up any other endorsement deals you have for the 30 days that surround the Olympics. Any deals with companies that aren’t “official partners” of the Olympics that is. It’s a rule that allows the Olympics to pimp their sponsors and not have to compete with individual ones. It’s buying access to a monopoly.
Such access gets your company exclusive rights to show your logo all over the Olympics. But perhaps even better, you can continue to advertise with your Olympian endorsers. So you can see Michael Phelps on the Omega website, in P&G commercials (Head & Shoulders), Visa ads, and any other sponsor he may have that pays the price to play. But you won’t see him in the Subway ads because while they paid for commercials on airtime, they didn’t pay to be a sponsor of the games. Notice the commercials and how they say “official sponsor of athletes everywhere”. No doubt some kind of shot at the Olympic rules.
The rule that bans such endorsement activity is apparently called Rule 40. And a number of athletes this year decided they wouldn’t be silent about it. Notably, the loudest voices come from the most financially stable competitors. But their voices are louder so they speak for their teammates who have to work other jobs in addition to training.
The counterargument of course is the advantages the Olympics affords all these athletes. Take Phelps, or his more charismatic NBC-generated rival, Ryan Lochte. Without the Olympics, who would watch them? The Olympics provides the forum that makes these people superstars. Other than the basketball team and some sports like beach volleyball and tennis, there’s not enough revenue outside of the Olympics to support these athletes at this level. So the Olympic committee deserves that revenue for elevating the sport. Then those athletes can use their new elevation for endorsements after the Olympics are over. It’s only 30 days out of 4 years. After all, the Olympics organization is a non-profit.
I can see the point the Olympic committee is making, but these restrictions don’t really exist anywhere else in the world and people get by just fine. Expect to see some changes in the future if more athletes get vocal. Or, perhaps they’ll get creative. Phelps has been wearing headphones up until the last possible second in each race. The company says they do not sponsor him. However, don’t be surprised if they don’t start after the Olympics.
 By The Weakonomist |
The Weakonomist is the face of Weakonomics. Click the puppy to learn more about him. If you like what you're reading consider subscribing to the blog, following him on Twitter, and checking out the related posts above. Please consider a donation if you really enjoy Weakonomics. Also keep in mind that nothing we say can be construed as financial advice. |
Be First To Comment!