Tennis star Maria Sharapova lost a number of high-profile sponsorships after announcing on March 7 that she had failed a doping test.
When your celebrity endorser (sooner or later) ends up in a scandal, how do you know if you should cut ties? Canadian Business asked the experts for their opinions on how to decide.
Inoculate yourself
“You need a very clear understanding of ethical risk in terms of what you will or will not tolerate, and have very specific policies about what you’ll do to pursue the bottom line. Communicate this to your employees and to your partners. That’s what we call ethical inoculation. You’re in a strong position to say, ‘We don’t do things like that around here,’ and sever a relationship that’s gone sour. Then it’s not a spur-of-the-moment decision if something negative has been brought to your attention. You should already have a policy in place, and you just need to apply the plan.”
David Nitkin, president, EthicScan, Toronto
Know who you’re dealing with
“If a brand or celebrity is associated with you and that relationship turns toxic, it’s a big challenge, but at the same time, it shouldn’t be too much of a surprise. Things tend not to turn toxic overnight. What it signals to me is you haven’t done your due diligence. Make sure you really know who you’re partnering with—and keep doing your due diligence even after you’ve entered the relationship, too.”
Andrew Crane, director, Centre of Excellence in Responsible Business, Toronto
Think broadly about risks
“A whole bunch of different socially important values that, for many years, were dismissed as being irrelevant from a business perspective are now being recognized as things you shouldn’t overlook when considering risk mitigation factors. My advice is to not be afraid to elevate these reputational risks to the top level of governance in an organization. Today, it’s a much more difficult proposition to hang on to someone like Donald Trump. His values will be construed as being your values by the public.”
Matt Fullbrook, manager, Clarkson Centre for Board Effectiveness at the Rotman School of Management, Toronto
Assess the damage
“It’s about whether the equity of the brand can survive the trauma. Martha Stewart went to jail, but a lot of people looked behind the story and decided she was a scapegoat for a whole other series of issues. She still delivered her value propositions and her brand was beyond reproach, so companies decided to stick with her.”
Wayne Roberts, principal and chief creative officer, Blade Creative Branding, Toronto
Look at your values
“You cannot pick and choose which parts of a brand you associate with, so therefore, if at any point your values no longer align it’s important to cut your losses and make a statement that is diplomatic, but also reaffirms your values. Audiences react well when a brand makes a large, and potentially unprofitable, move in order to stand up for its values. These courageous organizations can actually build more brand trust and therefore more supporters.”
Tammy Tsang, founder, My Loud Speaker Marketing, Vancouver
Plan your next move
“You can absolutely turn a positive into a negative. The public doesn’t like it when things go haywire between two companies. When there’s no cohesion in the relationship, you have to demonstrate that on your end, you’re going to say ‘No’ and move forward, with or without your partner. You have to be truthful and honest in your announcement, and about what you’re going to do. You also have to give the public a call to action or an example of how you’re going to maintain their trust. How you choose to act next will showcase why you decided to cut ties with a certain company. You could demonstrate something to a certain charity, preferably an initiative that was the focus of the controversy.”
Darryl Konynenbelt, media lead, Navigator, Toronto
This story originally appeared at CanadianBusiness.com.
