Getting Dissed: Nike and Lance Armstrong…and the critical decision to DISassociate with a brand.

Last month, I posted a blog discussing the value of a brand associating with another brand.  The gist of that post was that when a brand links with another brand, the credibility and goodwill of one is imputed to the other. This makes brand association valuable…a value that must be paid for.

But, every now and then, there comes a time when it is valuable for a brand to DISassociate itself from a brand.  When one brand does or says something contrary to the branded message of the other brand, the latter is faced with a decision:  allow its brand to be damaged/tarnished (and suffer a loss in brand value) or publicly acknowledge disapproval of the other brand’s conduct and unequivocally separate from it.

Lance Armstrong during his speech where he announced resigning from LiveStrong, his charity devoted to fighting cancer, in light of recent allegations of doping during his cycling career.

Such is the life of Lance Armstrong.  You cannot have the backing of Nike, one of the greatest sports brand of all time (with an astronomical monetary value) and then get caught up in allegations of doping.   It puts Nike into a corner, where it is forced to protect the value and message of its brand – a value and message that cannot condone doping.  To otherwise allow Lance Armstrong to still endorse Nike’s products after many of the doping allegations have been supported by evidence would be brand suicide.  Thus, we have Nike’s recent decision to separate from Lance Armstrong by terminating its endorsement contract with the athlete.  In short, Nike had to protect its brand from infringement.

Here’s the kicker:  The best part (for Nike) is that by taking a stand against doping and terminating its contract with Armstrong, it actually strengthens its branded message…increasing its value and brand goodwill with consumers.  How about that?  Cut off an endorsement and your brand value actually goes up!

The takeaway:  It is important for brands to understand that it’s not just good enough to build your brand.  You must DEFEND what you have built from any and everything that could tarnish and reduce its value.  If we learn anything from Nike, we learn that your brand value can increase when you take a stand to defend its message (and can be devalued if you don’t.)


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