On Sponsorships - Part 2

(This has been festering in my Draft file for almost a month. I started it soon after my first Sponsorship post, and kept meaning to edit it or add more - perfectionism can be so paralyzing! - but I lost my enthusiasm and it never happened. Still, I liked all the discussion from the first post, and felt like I had more to say on the subject. So here is my "raw" part 2 on how sponsored athletes influence sales.)

Recently Montrail and Pearl Izumi essentially disbanded their ultra-teams despite having several top level runners on their teams such as Ellie Greenwood, Max King, Amy Sproston and Kaci Lickteig. This change in marketing strategy by these companies begs the question: Do sponsored athletes improve sales?

In response to a previous post, Gretchen Brugman admits that after seeing Ellie Greenwood on her blog in a black puffy jacket, she immediately ordered one for herself. I do think elite athletes can influence impulse purchases, because impulse purchases aren't based on logic or need, they are based on wants and emotions. Having one top level athlete in agreement with the product you desire may be all the reason you need to go ahead and buy that item you have been longing for. 

Impulse purchases aren't necessarily bad - Gretchen says she loves her jacket and has no regrets - but when it comes to products that typically cost upwards of a hundred dollars (shoes, jackets, hydration vests, sunglasses, etc.), how often do we buy these things on impulse alone? More often than not, people do at least a little internet research before shelling out their cash. When making an educated purchase consumers may compare price, manufacturer's specifications and online reviews. But I'd be surprised if anyone weighs which top athletes are wearing the products they are considering.

Of course, for someone to consider purchasing a product, they have to be aware that product exists. And sponsored athletes may bring that attention to a product. But do sponsored athletes really increase sales?

Ken Michal noted in his recent URP interview that he thought it was cool that Dave Mackey wore the same shoes as he did, but as a back-of-the-pack guy what he really cares about is if the shoes work for other back-of-the-packers, not if they work for fast guys like Dave Mackey. I know when I got into this sport the three goddesses of ultrarunning were Nikki Kimball, Lizzie Hawker and Kami Semick, all sponsored by The North Face at the time. Those three were my heroes and I wanted to be just like them, yet I have never bought a single item of The North Face gear. To me, being like them meant training hard, performing well in big races and having lots of amazing running experiences; it didn't mean dressing like them.

I think most consumers recognize the success of the elites is due primarily to their hard work, natural talent, and gritty racing tactics and very little to do with the equipment they wear. We continuously watch elite athletes switch sponsors with virtually no change in their level of performance. And I don't think one has to be too cynical to think the reason athletes change sponsors has more to do with money than the products themselves. As I heard from one elite last year, "I really loved working with [company X], but the deal from [company Y] was too good to pass up." Similarly, as Montrail announced a cut in funds to athletes, most of their athletes quickly abandoned (sponsor)ship.

And it is hard to take recommendations from sponsored athletes at face value due to the inherent biases they have from being sponsored. Don't get me wrong, I am sure most sponsored athletes are with companies they believe in and are using products they really like, but would you ever expect them to recommend a brand other than the one they are running for? For example a Western States rookie runner recently asked me, Amy Sproston and Denise Bourassa for hydration pack recommendations and we all three recommended packs from companies that sponsor us. I know we are all quite happy with our packs and the responses were not disingenuous, but being sponsored means we may not have the same breadth of pack experience as someone who has had to go into a store a try out multiple packs before picking one, or even if we had two packs we liked, we might not mention one from a competitor brand. (For the record, I paid full price for my Ultimate Direction AK vest long before I was sponsored. Then again, I am probably telling you this to promote my sponsor. ;)

A Forbes study from 2012 showed that recommendations from friends or family had the greatest weight in determining what people purchase. Other promotions can influence sales as well. For example, Garnier beauty products got a bigger boost in social media buzz and sales after a coupon promotion than after announcing Tina Fey as their celebrity endorsement (but indeed there was a significant boost with that endorsement). Ace Metrix, a company devoted to television and video analytics, studied 2,600 commercials and found those with celebrity endorsements were no more influential (and in some cases even slightly worse) than those without celebrities. A study in the Journal of Advertising Research concluded professional athlete endorsement equated to a 4% boost in sales if that athlete was performing well. There was a lesser boost from retired or "non-winning" athletes. 

Ultrarunning is different than a lot of sports because it is such a "niche" endeavor. Even the best in our sport are largely unknown to those outside of the sport. But I think participants in ultrarunning feel more connected to the elites than the fans do in other sports. Because ultrarunning is so low-key, the elites remain approachable and relate-able. On race day, everyone lines up together and deals with the same hardships of the course, creating a sense of shared experience between the front runners and the rest of the field. The elites hang out post-race and eat the same post-race meal. And because sponsorship dollars remain fairly low, most elites still have day jobs and other obligations like the non-elites. Those that are able to subsist on running alone certainly aren't multi-millionaires living a life of opulence. And because ultrarunning is low key, most pre- and post-race interviews resemble an amicable conversation, rather than a formal press conference. For all of these reasons, I think many of the elites remain approachable and in some ways feel like "friends" with trustworthy opinions.

Because sales is about exposure and word of mouth, I do think the amount of commercial money coming into this sport will increase, especially as the sport continues to grow. BUT, I think this is going to be in the form of sponsors casting a much broader net with sponsorship opportunities trickling down to "sub-elites", frequent racers, and other visible but non-elite athletes. While sponsorship money for top athletes is  increasing, I think true "professionalism" in our sport will remain elusive. Due to the demanding nature of ultramarathons, a single athlete can only run a handful of races in top form every year. Add to that the fairly high risk of injury/burnout and it makes sense why companies would want to invest multiple small amounts of money in many different runners than a large sum in a single high profile runner. So while many were surprised and dismayed by the dissolution of of the Pearl Izumi team, their "grassroots" ambassador program is not without merit or business sense. Those athletes who are trying to make a living will likely need an entire list of sponsors to make it work.

There's a lot more money coming into the sport these days compared to when I was getting started. That's a good thing for promising runners looking to get some free gear or even subsidize their racing, especially for those who are willing to work for it and have high visibility amongst the fans. But I don't see runners getting rich off of sponsorship anytime soon, which means my job will continue to be my biggest "sponsor". ;)

So how do sponsored athletes influence your purchases? Do you ever think top ultra-runners will be able to "go pro" and earn enough to own a home or support a family?