In the Slovenian sports-marketing and sports-law practice, it is widely believed that any kind of appearance of an athlete or a celebrity in marketing communication of a company stands for a sponsorship of a person. This is entirely possible, but considering the nature of the transaction, in most cases so called endorsement dominates.

The endorsement is a quasi-sponsorship relationship based on selling the personality rights of an athlete (e.g. image, voice, nickname …) to a sponsor for the purposes of marketing communication[1]; quasi-sponsorship because an athlete doesn’t usually promote such sponsors on other, more traditional ways (e.g. logo on the equipment or on a car), but only by using the sponsor’s products or services. A typical example of such cooperation is established between Tina Maze and Zlatarna Celje (Tina Maze is the face of their collection and wears their jewellery).

This distinction between the classical sponsorship and the endorsement is crucial as shown especially in a dispute between Tina Maze and the Ski Association of Slovenia.

Various rights depending on the business collaboration

At the beginning, we must distinguish between sponsoring a club or association and sponsoring an individual. When sponsoring a club, the sponsor acquires the right to use the intellectual property rights of a club (its logo, its name …) and the marketing channels of the individual sponsored; while in sponsoring an individual, the person sponsored transfers the right to use her/his personality rights (name, photo, video material, nickname …) to the sponsor. The sponsor of a club thus not automatically acquire the right to use the athletes in its marketing communication unless the athletes transfer a part of their personality rights to the club[2], resp. if they expressly agree every time on this kind of promotion. In this case, clubs or associations must take into account the practice used in Europe.

In order to ease the illustration of all possibilities of cooperation with athletes, I’ll use the example of Tina Maze. You can collaborate with her through four different sponsorships: as a sponsor of the Ski Association, sponsoring the Team to aMaze (Tina Maze’s team), sponsoring Tina Maze as individual or as a company which carries out an endorsement. In the case of being a sponsor of the Ski Association and the Team to aMaze, there are no problems concerning the delimitation of rights. Sponsors of a person are those that can – according to the rules of the Ski Association – advertise on Tina’s equipment for competitions or can appear in her representative jersey in the sponsor’s marketing campaigns (e.g. Milka). These sponsors of a person don’t represent a problem since Tina can advertise them only with the consent of the Ski Association. The only problem therefore occurs in the case of endorsement, if they are (wrongly) considered as personal sponsorships.

The athletes can refuse to participate in sponsors’ or the Association’s marketing campaigns.

The sponsors of legal entities (clubs or associations) make an input that provides them with a number of rights, such as the right to advertise on the competition jersey, press panel or the use of the sports organization’s name. Bigger sponsors usually also obtain the right to use an athlete in their marketing campaigns, but only because the athletes agree with this kind of promotion, and not because the athletes transferred the right to use their personality rights to the club or the association or even to market those rights.[3]

The problems usually occur because the contracts regarding the extent and manner of participating in marketing campaigns of the sponsors are differently interpreted.

In developed sports-marketing environments, it is long time accepted standpoint, resp. business practice is that the sponsor of the sports organization in such cases has to use at least three athletes at the same time in its marketing campaigns. If there are more marketing campaigns (for various sponsors), different football players must participate and not always the same ones (in our country, they usually use only the best ones).[4]

The participation in marketing campaigns that are not in accordance with this practice brings a reduction of an athlete’s market value, since she/he wouldn’t be able to establish a business relationship with another company from the same industry and wouldn’t be able to make earnings. It is necessary to be aware of the fact that top athletes mostly earn money thanks to the good results (in the form of pecuniary prizes) through the sponsorship and especially endorsement contracts. Therefore, every athlete has a right to decline such collaboration without any consequences.

The athletes are the ones who – even in team sports where clubs are very strong brands – raise the clubs’ market value.[5]

Top athletes have become brands and as such are very powerful marketing tools. The usage of their personality rights is therefore no longer possible without adequate compensation. The earnings from the endorsements are much bigger than the amounts they receive for participating in sports. Let’s take Anna Kournikova for example who earned – via endorsements – nine times more money than with playing tennis. Olympic champion Usain Bolt, for example, earned 20 million USD with the endorsements, while only 300,000 USD directly from athletics; Tiger Woods earned 59.4 million USD last year – only 4.4 million USD by playing golf.[6]

Companies that are competition to the clubs and associations

Back to the case of Tina Maze – she can therefore participate in marketing activities of companies which represent a competition to Ski Association’s sponsors, but at the same time can’t use any kind of branding or other material that would establish a link with the skiing representative team or the Ski Association. Any kind of limitation or even obtaining sponsors, resp. endorsements would be contrary to the European Union law, as it would limit the earning opportunities (such rule would hold up only in the event of an athlete being paid for this kind of engagement).

Taking the example of skiing, average skiing representative team member who hardly earns anything with the prizes in competitions would be completely limited in getting her/his own sponsorship funds since all the sponsorship areas are already ‘full’ (banks, insurance companies, mobile operators, cars, sports shops …) and would be able to focus only on finding small local sponsors (e.g. pizzeria). Recognising the fact that it is their profession and the fact that this year some of the athletes even had to contribute to their preparations, it is very likely that such limitations wouldn’t be supported in a judicial review.

This is perfectly normal practice in developed sporting environments. David Beckham is for example involved in sponsorship projects as a member of Manchester United, the English representative team and as David Beckham personally.[7]

Regulation and development of this field in the hands of athletes

The boundary between the sponsorship of a person and endorsement is often blurred and it is difficult to determine it – especially in the case of an athlete that is not the best of the best. Those athletes must offer their partners-sponsors other marketing channels and not only the possibility of using their personal rights. It would be easier to understand the difference between the one and the other form of collaboration when the athletes will stand up against marketing exploitation for »higher« goals while not receiving even the minimum wage. They usually do it for the sake of the sport. Thus, it is difficult to expect (r)evolution in the business of sport.

The article was published on 6 September 2012 in Pravna praksa (“Legal practice”), no. 34.

[1] Gardiner, S., et al: Sports Law, third edition. Cavendish Publishing, London 2006, p. 433-434.

[2] In such cases, too an athlete can be used only in the context of a club. Thus, for example, the rights are regulated in the standard contract of the English Premier League in the section of »Community public relations and Marketing”, where it is specified that »/…/ The Player hereby grants to the Club the right to photograph the Player both individually and as a member of a squad and to use such photographs and the Player’s Image in a Club Context in connection with the promotion of the Club and its playing activities and the promotion of the League and the manufacture sale distribution licensing advertising marketing and promotion of the Club’s club branded and football related products (including the Strip) or services (including such products or services which are endorsed by or produced under licence from the Club) and in relation to the League’s licensed products services and sponsors in such manner as the Club may reasonably think fit so long as /…/.”

[3] Lewis, A., and Taylor, J.: Sport: Law and Practice, second edition. Tottel Publishing, London 2008, p. 1153-1154.

[4] Ibid, p. 1183-1184.

[5] Blackshaw, I. S.: Sports Image Rights in Europe. T. M. C. Asser press, Haag 2005, p. 1-2.

[6] http://www.forbes.com/pictures/mli45igdi/1-floyd-mayweather/#gallerycontent

[7] Lewis, A., in Taylor, J., nav. delo, str. 1183-1184