Armstrong gets dumped
Nike is a cloth and footwear company with its products having gained high recognition for their design and quality. Lance Armstrong is a seven time champion of the Tour de France cycling championship. Lance Armstrong has been the brand iconic figure for a long time. The long term relationship that stretched far back from 1996 was cut short by allegations that all time cyclists have been involved in drugs during his race events to enhance his performance. It is quite evident that Mr. Lance was facing serious drug related allegations. It was good for sponsors to terminate such relations between themselves and the athlete to avoid a bad reputation for the company (Reed, Vanessa, &Vranical, 2012).
The partnership between Armstrong and Nike had extended to Armstrong’s foundation commonly known as Livingstone. For a number of times, Nike has gone on record defending Armstrong in the drug related allegations. Recently, the United States of America Anti doping Agency issued a conclusive report accusing the champion of a massive team doping scheme. This report was more conclusive than the other report that had been issued in the past. Following the conclusive report being released to the media, Lance resigned as chairman of the board. This was after lengthy consultations with his family. Lance Armstrong continues to deny the allegations (Reed, Vanessa, &Vranical, 2012).
Since 2000, Nike has portrayed Mr. Lace as a clean or drug free athlete. However, the drug related allegations stretch far back and Mr. Lance has been adamant to deny the same. Through many commercials that used to begin with all time champion taking a blood test followed by comments on how he used to practice, Nike implied that the champion never used drugs to enhance his performance (Roth, 2012)..
The finding that was released by the Anti doping agency seemed to create a waiver on Nike’s believe on the athlete ’s integrity levels. In addition to Nike, Trek which is the company that made each bike that Mr. Armstrong rode on also ended their relationship with what they declared to be disappointing. Over the years, Mr. Armstrong had been given a stake in the company , and like all the other partners, Trek decided that he could keep his stake in the company which had been accorded due to sheer goodwill (Doeden, 2006).
Radio shack had been yet another corporation that had signed a sponsorship agreement with the athlete. The relationship between the athlete and Radio shack spun back to 2009. With the release of the drug related report, Radio shack ended its relations with the athlete. As of June 2008, Mr. Armstrong Lance was regarded as the 60th most effective product spokesman alongside Brad Pitt. After the release of the report, his rankings dropped to 1410 along side Nicki Minaj. This not only shocked marketing experts but the sporting fraternity as a whole was dismayed by the news (Reed, Vanessa, &Vranical, 2012).
As a result of these, many companies have withdrawn the sponsorship contracts they had signed with the star. As for the validity of their actions, the companies were legally protected. This is because; the sports icon had indulged in an illegal activity hence lacks any grounds to sue. There are still pending litigation made against the Anti doping agency by Mr. Armstrongs lawyers. However, if the report is true, Mr Armstrong should be thankful to his sponsors for not taking any legal action , and some have even allowed him to maintain his share in their companies for instance Trek (Vertuno, 2012).
It is quite evident that Mr. Lance was facing serious drug related allegations. To avoid bad company reputation, it was best for sponsors to terminate such relations between themselves and the athlete. For Nike and Radio shack, after terminating the contract, they still let Mr. Lance maintain his stake in companies which was quite considerate. Since the bone of contention revolves around illegality, compromise would not be a viable option , and as such Mr Lance should be grateful that no litigation was filed against him.
Doeden, M. (2006).Lance Armstrong. Minneapolis: Twenty-First Century Books.
Reed, A., Vanessa, O. &Vranical, S, (2012). Lance Armstrong Gets Dumped: Nike, RadioShack, Others Distance Themselves From Cyclist Amid Drug Scandal. The Wall Street Journal (18 October 2012).
Roth, D., (2012). A Long Day for Brand Armstrong.The Wall Street Journal (18 October 2012)
Vertuno, J., (2012). Judge questions USADA, Armstrong lawyers. Associated Press (10 August 2012)