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Ryan Lochte Celebrity Scandal Cost Endorsement Deals & Other Celebs Who Have Messed Up

Posted by Hollywood Branded on August 25, 2016 at 2:00 PM

How To Safeguard Your Brand Against A Scandal

A week into the Olympics and the world viewed Ryan Lochte as the lovable if somewhat rogue-ish all American swimming champ with 12 gold medals for the United States. No one could have guessed he would turn into an international pariah overnight after lying about a robbery that never took place and vandalizing a gas station - least of which included his many celebrity sponsors. 

But surprised do happen - and that's saying it nicely.  Brands need to be aware that they either need to diversify by having more than one celebrity endorser at a time, or have a plan in place if havoc breaks out.  In this blog, Hollywood Branded looks at celebrity endorsements that have been lost due to bad behavior - and how to safeguard your brand.


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Ryan Lochte's Big Loss - And How Speedo Spun It Around

Ryan Lochte didn't just lose America's respect - he lost close to $1 million in endorsement deals overnight. 

These included deals with Ralph Lauren, Speedo, Syneron Candela's Gentle Hair Removal and Japanese company Airwave. Despite his apology, almost all of his sponsors dropped him as a celebrity endorsement following his false police report and clear disrespect for the city in which he was competing.  And one quick thinking sponsor signed him up too!

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Speedo had an interesting way of turning their misfortune around. Instead of just issuing an apology and severing ties with the Olympic athlete, the brand gave the money they would have spent on Lochte in endorsements this year to underprivileged children in Brazil via a charity called Save The Children. 

Quick thinking helped turn around the negative press for Speedo. Check out these other celebrities who have lost big deals as a result of embarrassing and downright wrong behavior.


Celebrities Who Have Lost Big Deals

Manny Pacquiao

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The world-champ boxer lost a huge deal with Nike following negative and offensive remarks regarding homosexuals. This was a bold move for Nike who stuck by both Tiger Woods after his extramarital affairs were revealed as well as Maria Sharapova following her testing positive for banned substances. 

Because Nike is known to stand by athletes who make slip-ups, it made a statement that they quickly stepped away from Pacquiao. The company referred to his comments as "abhorrent" and made clear that his viewpoints differed greatly from their morals as a brand. 


Ray Rice 

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When video surveillance surfaced showing the Baltimore Ravens player punching his fiancee, brand retribution was swift. Jerseys were pulled from stores and online retailers and EA completely took Rice out of their Madden football game series.

Again, Nike severed all ties with the player, reminding the public that while they stick by imperfect athletes, they absolutely do not condone hatred or abuse of any kind.


Paula Deen

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Food Network star and celebrity chef Paula Deen faced steep consequences after admitting to using hateful racial slurs, even though the allegations were years prior. 

The list of endorsers who dropped her goes on and on but includes Walmart, Smithfield Foods, Target, QVC, Home Depot, diabetes drug company Novo Nordisk, and Caesars Palace as well as losing her contract with the Food Network. In today's society, racism of any type does not bode well for brands.  Except for Duck Dynasty's Phil Robertson.  The same retailers gave him allowance to voice his supposed religious viewpoints when scores of his fans stood up for him, showing the marekting dollar strength of the Bible Belt in full force.  


Lance Armstrong

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In perhaps the most infamous fall from grace in celebrity endorsement history, Forbes estimates that Lance Armstrong lost close to $150 million after the U.S. Anti-Doping Agency gave him a life-long ban and stripped away his 7 Tour De France wins.

Armstrong didn't just lose his record wins, he lost sponsors immediately, including Anheuser-Busch, Trek Bikes and Nike. On top of all his endorsement losses, the cyclist was let go from the company he started, LiveStrong. 


How To Safeguard Your Brand's Celebrity Endorsements

Speedo, Ralph Lauren and the rest of Lochte's endorsements were not the first and will most certainly not be the last companies to have a celebrity endorsement go wrong on them. Celebrities slip up and they brands they endorse often step away as quickly as they can. 

Of course, you or your brand can't possibly foresee a beloved celebrity acting in a horribly unexpected way. However with a quick-witted marketing team and a speedy reaction time, your brand can turn an unfortunate situation around, the way Speedo's did. 

Also, making clear your expectations and rules for the endorsement should be clearly outlined in the contract, including a morality clause that allows you to quit the contract should the celebrity violate your brand's image with their actions.  Immediately.

The truth is, the benefits of celebrity endorsements far outweigh the risks of their bad behavior. And most celebrities play well, as they know it's their career at stake.  It is a proven fact that celebrities influence consumer trends and purchasing habits. As long as you have safeguard, your brand should be a-ok.  And consumers know that brands are not the direct reflection of a celebrity.  To err is human, and perhaps erring as a celebrity just humanizes them all the more.


How To Do Celebrity Endorsements - The Right Way For Your Brand

Are you interested in learning how to successfully partner celebrities to your brand - without spending a million?  Watch this short webinar to learn Hollywood insider tricks to create and kick start an entertainment marketing campaign that is the perfect extension for your social media program.Celebrity Social Media Webinar by Hollywood Branded

Topics: Branded Content & Integration, Celebrity Initiative, Public Relations

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