Image and reputation - some of your most important assets
Unwanted high profile media stories of this type result in sports stars losing valuable sponsorship contracts with cautious global brands. There are now countless top sports stars that have been affected by doping scandals, the result of which is a massive financial impact on their earning power, as the majority of income for top stars comes from sponsorship. Most sponsors are quick to distance themselves from misconduct or cheating allegations and their contracts have clauses allowing them to get out, even if guilt hasn't been proved.
For guilty athletes the road to reputational recovery can be a very long one and it usually has to start with a sincere apology and some voluntary work to educate others. For the innocent, they need good lawyers and PR advisers.
Although this is the dark side of being a high profile person, some sport stars like footballer David Beckham and US welterweight boxer Floyd Mayweather, who's ‘Forbes’ estimated worth is $44 million, have made bigger fortunes out of carefully managing their brands into new business ventures. In 2015, ‘Brand Beckham’ was estimated to be worth £40million a year according to the London School of Marketing who say their total fortune stands at £470mn.
Sport is big business; sportsmen and women stand to make a lot of money in a relatively short space of time. Having a strong image or brand can extend their earning potential.
At Whitmill, we often see marketing rights being carved up into individual structures in relation to separate investment opportunities, for example, the 'social media rights' of a sports star may be a separate investment opportunity to clothing sponsorship rights; or as part of retirement or succession planning. So think on this as you watch a young rising sports star during the 2016 Euros in France or the Olympics in Brazil!