Heir Jordan

Playing a sport few people watch in a league few people know, Sheryl Swoopes couldn’t possibly be like Mike in terms of her earning potential. Still, her $1.2 million in endorsements is a slam dunk.

June 1999By Comments

Given her astounding athletic accomplishments—as a senior at Texas Tech University, for instance, she broke Bill Walton’s record for the most points ever scored in a Division I NCAA basketball championship game—you might expect Sheryl Swoopes to be fashionably blasé about a four-year-old sneaker deal. But if you ask the Brownfield native what it was like when Nike told her the company wanted to name its new women’s basketball shoe Air Swoopes, she practically comes apart. “I was speechless,” she says excitedly, her words tumbling out faster than her feet take her down the court. “I cried. I bawled. At first I thought they were joking. I don’t even know what I thought. I was just out of it. I thought I was dreaming.”

If she was dreaming, she hasn’t woken up yet. Since Nike announced the launch of Air Swoopes at a New York press conference in the spring of 1995, its 28-year-old namesake has won a gold medal as part of the United States’ women’s Olympic basketball team and two championship rings with the Houston Comets of the Women’s National Basketball Association, married her high school sweetheart, become a mother, and perhaps most surprising, built an impressive endorsement portfolio. Through contracts with companies like Kellogg and products like Discover Card, personal appearances, and licensing deals—in addition to the original Air Swoopes, there have been three more versions of the shoe (a fifth will be in stores in July), three Swoopes basketballs, a Swoopes jersey, three Swoopes children’s books, a Swoopes coffee-table book, a Swoopes trading card, a Swoopes phone card, and even a Swoopes action figure—she pulled in an estimated $1.2 million in 1998, quite possibly the most money ever earned in a single year by a female athlete who plays a team sport.

In the complicated world of endorsements, several female athletes who compete individually earned more in 1998, including tennis star Steffi Graf (an estimated $5 million), ice skater Kristi Yamaguchi ($3 million), and skier Picabo Street ($2 million). And, not surprisingly, since professional sports is so heavily dominated by the other gender, many men earned more too. Michael Jordan, for instance, collected an estimated $17 million in endorsement contracts—the most of any athlete. In Texas alone six male athletes who compete in either individual or team sports topped Swoopes’s take (George Foreman, $4.5 million; Emmitt Smith, $3.5 million; Troy Aikman and Charles Barkley, $3 million; David Robinson, $2 million; and Hakeem Olajuwon, $1.5 million). But that doesn’t diminish what she has achieved. Sheryl Swoopes is the first female basketball player to become a marketplace star, making her $1.2 million a greater accomplishment than the others’ multimillions. The story of her rise from small-town Texas girl to one of the nation’s best-paid product-pitchers says a lot about her determination, and it says even more about the way endorsements work: who gets them, how much they’re worth, and why.

To understand Swoopes’ success, you have to know a little bit about why Nike and other companies partner up with athletes in the first place. In the most basic of terms, marketers use sports stars because consumers know them, admire them, and aspire to be like them. The logic of an endorsement deal is that an athlete’s association with a product will make consumers notice it and buy it either because they want to emulate their hero or because a certain kind of transference occurs in which the athlete’s positive qualities (such things as courage, charisma, and talent) are projected onto the cereal, shoes, or whatever is being sold. Of course, not every athlete makes this work. The trick for marketers is to find those who can. Though there are always exceptions, whether an athlete gets an endorsement deal depends on four key factors.

Ability Marketers want only the best athletes to endorse their products. That’s because companies want to be associated with winners. The better the athlete, the more likely it is that consumers know him and want to be like him.

Sport Which sport an athlete plays is important not because of the sport per se but because of the audience it attracts—or to be more precise, because of the size of the audience it attracts. Since marketers want athletes who are well-known, they focus on sports that have a mass following, extensive press coverage, and regular television exposure. Conversely, an athlete who plays a sport that is little seen and rarely written about isn’t going to get a deal. (How many women softball stars do you see endorsing soft drinks?) This is why, generally speaking, men’s basketball and football players tend to have large endorsement incomes: A lot of people see NBA and NFL players, on TV and in person, on a regular basis, ensuring that those players are instantly recognizable and have a rabid fan base. And when fans are rabid, they’re motivated to buy the products their heroes are associated with.

That said, audience size isn’t everything. Although more Americans watch pro football than pro basketball—last year the average TV ratings for the NFL and the NBA were 12.9 and 7.6, respectively—marketers seem to give a slight edge to basketball players. Why? “The advantage is there are only five men on the court on each side, and they are in continuous action, so you’re getting to watch them all the time,” explains Gerald Scully, an economics professor at the University of Texas at Dallas. “In football there are eleven men on each side, and they are all covered up with helmets and padding.” No surprise, then, that while a few standout position players like Emmitt Smith of the Dallas Cowboys have made lucrative deals, quarterbacks tend to be the NFL’s endorsement kings, since they are usually the most visible. Whether an athlete plays a team or an individual sport also affects how marketers can use him because individual-sport athletes have more control over the equipment they use and the apparel they wear. Golfers and tennis players, for example, can choose their own clubs or racket, clothes, and shoes—each of which allows for a separate endorsement deal. An athlete who plays on a team, however, wears a uniform and, at least in the case of football and basketball, shares a ball, which limits marketing opportunities.

Image Image takes into account personality, appearance, and upbringing. For reasons that are obvious, a likable athlete is preferable to an unlikable one, and a handsome man or a pretty woman is more apt to capture the attention of the consumer, at least temporarily. And while it isn’t necessary for an athlete to overcome obstacles before he gets an endorsement deal, it doesn’t hurt. Take George Foreman. His boxing prowess and can-do demeanor help him make more money in endorsements than just about any Texas athlete, but the x factor is his log-cabin story: grew up fatherless in Houston’s Fifth Ward, lived for a time on the street and committed petty crimes, turned his life around to become the heavyweight champion of the world. Humor, humility, a positive attitude, sincerity, competitiveness, graciousness: These are the things that make us like certain celebrities more than others, and marketers know it. Of course, not every athlete is Michael Jordan. Among NBA stars, the immodest Charles Barkley of the Houston Rockets and the literally colorful Dennis Rodman (late of the Los Angeles Lakers) have earned some serious cash shilling for products ranging from sneakers to sunglasses. But they are truly anomalies—and although Barkley comes across as arrogant and Rodman dresses outrageously, neither has choked a coach, as Latrell Sprewell of the New York Knicks has. Sprewell, not coincidentally, has just one endorsement—not for a major brand name.

Agent A good agent can be the deciding factor in who gets deals. Just as Hollywood actors depend on agents to get them the right parts in the right movies for the right price, sports stars rely on sports agents to identify endorsement opportunities, sell them to the companies, and negotiate the best price. As you might expect, the harder the sell, the more important good representation is. Since female athletes who play team sports have relatively small audiences and are fairly new to the endorsement game, the agent is an even more important component of the equation.

The $1.2 million that Sheryl Swoopes earned last year in endorsements is clear evidence that she has good representation. But just as a great athlete can go nowhere without a great agent, a great agent can do little with a mediocre athlete who lacks good looks, charm, and an inspiring background. Fortunately Swoopes had not only talent to sell but also the story of someone who, through determination and hard work, overcame personal hardship. “Sheryl’s is very much an American tale,” says Sue Levin, who was Nike’s marketing director of women’s U.S. products when Air Swoopes was launched. “I think that’s something people are aware of, and that’s positive.”

To be sure, Swoopes didn’t have it easy. She was born on March 25, 1971, in Brownfield (population: 10,000). Not long after that, her father left home, so she and her three brothers were raised single-handedly by their mother, Louise, who occasionally relied on welfare to support the family. “We grew up in a three-room house,” Swoopes says. “Not three bedrooms. Three rooms.” Needless to say, there were no cars or vacations, but there was basketball. Swoopes started playing when she was around seven, she says, “because my brothers played, and the only way my mom would let me even think about leaving the house was if I was going with them somewhere.” That didn’t mean, however, that her mother supported her interest in basketball. “When I was younger, she wanted me to go in the house and play with my dishes or my dolls,” Swoopes says. “I guess it was just unheard of for a girl to play basketball, or she didn’t want her little girl to get hurt.” That changed when Swoopes entered high school. “Once I set my mind to it and said, ‘I don’t care what you say, I’m going to play, I want to play basketball,’ then people started to support me.” Her mother came to every home game.

Swoopes got really serious about basketball in her junior year at Brownfield High, in part because she knew she wanted to go to college and an athletic scholarship was the only way she could afford it. By the middle of her senior year, recruitment letters were pouring in from Harvard University, the University of Hawaii, and everywhere in between. But Swoopes wanted to stay in Texas, and she chose the University of Texas at Austin, which at the time had one of the best women’s basketball programs in the country. Unfortunately for UT, Swoopes got homesick and left after less than a week, transferring to Texas Tech University, in Lubbock, which is only forty miles from Brownfield. “There were a lot of people who told me I was doing the wrong thing, that if I left UT, I would never win a national championship,” she says. She proved them wrong. As a senior at Texas Tech, Swoopes scored 47 points in the NCAA championship game and led her team to its first title ever. “It was absolutely one of the great all-time performances in basketball,” recalls Levin. Nike executives were so impressed with Swoopes’s ability and off-court demeanor, in fact, that they signed her up soon after she graduated.

That first deal simply had Swoopes wearing Nike apparel and making a few appearances, but it quickly expanded, thanks to serendipitous timing. Just as Nike was looking for a way to boost her public profile—with no professional women’s basketball league in the U.S. back then, she would not be regularly in front of an audience—others at the company decided the best way to increase its number of female customers was to introduce a women’s basketball shoe along the lines of the wildly successful Air Jordan. Swoopes had everything going for her, including, in Levin’s words, “the best basketball name ever.” Within six months, in the spring of 1994, designers were making the initial drawings for an Air Swoopes shoe—the first Nike basketball shoe named for a woman.

Though Swoopes was understandably thrilled about the sneaker deal, she still didn’t have a league to call home. She had tried playing professionally for an Italian team right after leaving Texas Tech, but a contract dispute had her back in Texas after only ten games. As a result, less than a year after playing one of the best basketball games ever, Swoopes was working at a Lubbock bank during the day and playing pickup games at night to keep in shape for the Olympic basketball tryouts the following year.

Given that scenario, it’s easy to understand why no other endorsement deals were in the offing. Swoopes was a smart choice for Nike since it was selling basketball shoes to girls who were already interested in the sport. But for most companies, especially those not in the business of selling sports equipment, using a female basketball star the general public hadn’t heard of and wasn’t going to see play didn’t make any sense. Luckily Swoopes’s audience problem was short-lived. In May 1995 she made the women’s Olympic team, meaning a national audience would watch her play during the summer of 1996. Better still, the NBA helped put together a nine-month tour of the team, which went undefeated in exhibition games around the world and eventually won a gold medal in women’s basketball. Interest by fans and corporate sponsors was so great that NBA decision makers concluded that the time was right to launch a women’s pro basketball league, the Women’s National Basketball Association. Although the same idea had failed many times before—no women’s pro basketball league had ever lasted more than two seasons—the WNBA’s ties to the NBA were reason enough for optimism. It proved well founded: Attendance in 1997, the WNBA’s first year, averaged 9,669 per game, more than double the league’s own predictions, and last year it grew to 10,869. TV audiences have been respectable too. WNBA telecasts on NBC logged Nielsen ratings of 2.0 in 1997 and 1.6 in 1998—far below those of the NFL, the NBA, and major league baseball, but not much less than tennis.

Once Swoopes had a public platform, her image carried the day. Indeed, her personality seems tailor-made for marketers; she’s routinely described as upbeat, well spoken, and extremely personable. “I think one reason that she’s been so successful is that she comes across as a happy person,” says Gregory Leonard, a director of the Massachusetts consulting firm Cambridge Economics, which has done work for the NBA. Moreover, she’s a happy person who overcame obstacles. That she is physically appealing as well only helped her prospects.

Of course, prospects are one thing; an actual contract is another. That’s where Swoopes’s agent came in. Judging solely by her success to date, you’d have to say she’s done well with Advantage International, which is based in McLean, Virginia. In the five years that she’s been a client, the agency has upped her annual endorsement income by more than $1 million. “I think it’s probably one of the best decisions I’ve made,” Swoopes says. “I just love them to death.” And it is them. Like a lot of other large sports marketing firms, Advantage has multiple people working on behalf of a single athlete. In Swoopes’s case there is an eight-person “Swoopes team.” Along with her agent, she has a business coordinator, three sports marketers, two public relations specialists, and an administrative assistant.

In the simplest of terms, here’s how it works. The agent is in charge of negotiating all shoe deals and sports contracts, whether with a league (as in the case of the WNBA) or a specific team (as in the case of the NBA, the NFL, and major league baseball). The business coordinator handles all the day-to-day issues, including the athlete’s schedule and travel arrangements. The sports marketer is the person with the most control over the athlete’s marketplace destiny. Sports marketers are the ones responsible for devising an endorsement strategy for the athlete, seeking out new marketing opportunities, pitching the athlete to prospective sponsors, and finally, counseling the athlete on which deals to accept and which to decline. Just as Hollywood agents consider how various movie parts will affect an actor’s future, sports marketers think about whether an endorsement deal will enhance or cheapen an athlete’s image, which could lead to more or fewer opportunities down the road.

And how do they do all this? There are a few rules in the endorsement game, but mostly it depends on the individual athlete and how the specific marketer operates. “I could write you a tome and tell you everything you should do, and it wouldn’t help you a bit because it’s all about modulation,” says Tom George, Advantage’s senior vice president for athlete marketing. “It’s all about judging what’s in front of you and moving when the time is right. Do you bring the price up now or do you bring it up later? It’s about how hard to push and when.”

Apparently George knows how and when to push. For one thing, he and his team at Advantage have made Swoopes a player in the lucrative appearance market, in which popular sports celebrities get paid for two hours of signing autographs, making inspirational speeches, or simply shaking hands and smiling. The going rate is $2,000 to $50,000 per appearance; Swoopes’s rate is currently $15,000 a pop, and she earned approximately $200,000 this way last year. George and company have also increased her endorsement opportunities. Five years ago Swoopes’s only deal was with Nike. Today the list of companies who have used her to peddle their wares has expanded beyond Nike (estimated fee and royalties: $350,000) to include Wilson ($50,000), Kellogg ($150,000), TurtleShells protective gear ($50,000), Discover Card ($125,000), Clean Shower ($100,000), and Hasbro ($50,000).

Exactly how these and other companies came to do business with Swoopes varies tremendously. Some, like Kultur­White Star Video, which markets an instructional basketball tape, approached Advantage asking specifically for Swoopes. Others, like Clean Shower, had to be approached by Advantage, requiring one of George’s sales reps to sell Swoopes—in print and in person—as a great endorser. Still others, like Kellogg and Wilson, linked up with her as a result of their prior relationship with Advantage. In early 1995, for instance, George learned that Kellogg was interested in signing a member of the women’s Olympic basketball team to appear on cereal boxes. He proposed Swoopes, and the company bit: By May of that year she was under contract. Charmed by her, Kellogg re-signed Swoopes in July 1997 as a corporate spokesperson, a job that involves personal appearances, signing autographs at children’s basketball clinics, and being featured, along with Grant Hill of the NBA’s Detroit Pistons, on the back of various cereal boxes. In mid-1998 Kellogg expanded Swoopes’s responsibilities to include endorsing its Nutri-Grain cereal bars.

The Discover Card deal was altogether different, but not unusual for the world of athlete endorsements. In that case Nova Lanktree, whose Chicago-based Lanktree Sports matches sports stars with companies in need of endorsers, had received a call from longtime client DDB Needham, which was looking for an athlete to appear in a national ad campaign for Discover Card. Lanktree was given a budget—she won’t say how much—and then, as she usually does, she called Tom George and about ten sports marketers. After George and the others sent her short lists of athletes they thought would work well, Lanktree passed the names on to the talent manager at DDB, who turned them over to the Discover Card team, which in turn, made the decision to use Swoopes and four others. Just how good Advantage has been for Swoopes was on display when she nervously called George in early 1997 to tell him she was pregnant—and that the baby was due in June, the first month of the WNBA’s first season. That meant one of the league’s highest profile players wouldn’t be able to play at least part of the season. “It could have been a real problem PR-wise,” says George. But they found a way to turn it to their, well, advantage. In what has proven to be a smart move, George and Swoopes decided not to play it down but to play it up, which has led to new endorsement opportunities as well as more media exposure. A pregnant Swoopes was featured on the cover of the debut issue of Sports Illustrated for Women, and People reported on the birth of her baby, a boy named Jordan in honor of Michael Jordan, her friend and mentor. Today George markets Swoopes as a “supermom” and is looking into new endorsement categories, such as diapers and other mother-related products that a childless basketball star couldn’t do. In the meantime companies that have worked with Swoopes for years couldn’t be more pleased about her motherhood. “She’s a working mom,” says E. L. Chaffee, a consumer promotions manager at Kellogg. “She has all the characteristics of our consumer, yet she’s doing something fabulous with her life. There’s a lot of power in that imagery for us.”

What’s next for Swoopes? Most people agree that her status as an endorser is tied to the WNBA. “Her success in the marketplace is contingent upon her playing,” Lanktree says. “She doesn’t necessarily have to win championships all the time, but TV has got to cover her team and attendance has to be good, because the advertiser needs something to link up to. They need to say, ‘Gee, we had very high ratings on the day that she played,’ which means the fan, who is the potential consumer, saw her.” Unfortunately there’s no way to tell how the league will do. It’s not yet making money, and its positive buzz could wane as the novelty wears off (though, of course, it may not matter if it doesn’t make money for years, since the NBA can afford to keep it going if it wants to). Even if the WNBA continues to be viable, Swoopes’s endorsement income is far from guaranteed. The inherent vagaries of the ad business can change things dramatically. For instance, she won’t be working for Discover Card in 1999 because its parent company changed its marketing strategy and will not use celebrity spokespeople.

Not that Swoopes won’t continue to have all the attributes companies love. “Five years from now,” Lanktree says, “if her star keeps shining, if she keeps playing beautifully, and if she continues to stay in the public eye, there’s an awful lot of extra dimension to her as a credible spokesperson.” But the reality, alas, is that even in the best of all possible worlds, it’s highly unlikely that Swoopes’s endorsement income will ever rival that of a top men’s basketball player. Even her agent knows it. “It won’t happen in my lifetime,” says George. “Until the platform on which women’s basketball players stand becomes significantly larger, their endorsements can’t get larger. Michael Jordan stood on top of the NBA platform, and that’s a huge platform. The WNBA, God bless it, is a relatively small platform.”

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