In the article Lance Armstrong Gets Dumped Reed Albergotti, Vanessa O’Connell and Susanne Vranica (2012) describe the actions against the famous athlete Lance Armstrong by such companies as Nike or RadioShack. In particular, the authors report that these organizations cancelled commercial contracts with this athlete because he was found guilty of using performance-enhancing drugs (Albergotti, O’Connell, & Vranica, 2012).
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This decision can be explained by the willingness of corporate executives to make sure that their products appeal to clients (Albergotti, O’Connell, & Vranica, 2012). Therefore, Armstrong’s violation of anti-doping rules produced significant implications for many businesses. Moreover, the athlete was deprived of many financial bonuses that companies previously offered him.
Furthermore, the authors focus on the importance of reputation for marketing activities of a company. In particular, they refer to the results of a consumer research according to which the products associated Lance Armstrong became less popular among consumers (Albergotti, O’Connell, & Vranica, 2012).
Additionally, the writers also mention such athletes as Tiger Woods or Michael Vick whose contracts with private companies were ended because their public image was tarnished. The problems examined by the authors can be relevant to businesses that strongly rely on celebrities in effort to promote their products or services. The leaders of these companies should remember that this strategy is not always effective.
On the whole, this article illustrates that the behavior of only one individual can have significant implications even for large organizations that invest many millions of dollars in their marketing activities. Such companies as Nike have to make sure that their brand or products are not associated with something negative such as doping.
This is the main reason why they end partnerships with athletes or other celebrities who have been involved in some scandals (Horrow, 2011, p. 177). The case of Lance Armstrong is probably the most prominent one. Moreover, this situation shows that modern consumers pay attention to the ethical aspects of corporate and individual behavior (Harrison, Shaw, & Newholm, 2005, p. 50).
In my opinion, this is a positive tendency because it forces businesses to set higher standards for their performance. Nevertheless, I do not support the idea that people’s buying decisions should be influenced by celebrities. As a consumer, I do not pay much attention to such commercials.
It is quite difficult to provide any alternative solution to the problem described in the article. The thing is that Nike and other companies strongly rely on the reputation of athletes who often act as role models for buyers (Beverley-Smith, 2002, p. 11). Under such circumstances, the termination of the contract is the most reasonable response.
Moreover, Nike or other companies could even sue Armstrong. Moreover, I can say that these organizations should not rely strongly on celebrities when promoting their products. In this ways, scandals related to doping will not affect them strongly. This is the main recommendations that I can make to companies like Nike.
On the whole, this discussion shows that the performance of a company can depend on a variety of factors and some of them are quite unpredictable. The case of Lance Armstrong demonstrates that reputation plays a key role for modern businesses that emphasize their corporate responsibility. The issues discussed by the writer can be relevant to various companies that are dependent on their public image.
Albergotti, R. O’Connell, V. & Vranica, S. (2012). Lance Armstrong Gets Dumped. Retrieved from https://www.wsj.com/articles/SB10000872396390444868204578062313532317222
Beverley-Smith, H. (2002). The Commercial Appropriation of Personality. Cambridge: Cambridge University Press.
Harrison, R., Shaw, D., & Newholm. T. (2005). The Ethical Consumer. London: SAGE.
Horrow, R. (2011). Beyond the Scoreboard: An Insider’s Guide to the Business of Sport. New York: Human Kinetics.