Social media could turn athlete earnings gold
Olympic athletes are returning home from the London Games, hoping to extend their peak period for endorsement earnings through their increased popularity on social media.
Many athletes saw their earnings potential skyrocket during the Games, even existing household names such as Michael Phelps, the US swimmer crowned as the most winning Olympian of all time, and Usain Bolt, the fastest man in the world.
The athletes, who both are endorsed by a lineup of global brands, could earn about $50m a year in endorsement deals should they be able to extend their time in the spotlight beyond the halo of the Games, according to SponsorHub, a company that brokers endorsement deals.
An athlete's following on Twitter, Facebook and other social media sites has quickly become key in determining this.
"Brands always ask how many followers an athlete has," said Ricky Simms, director at Pace Sports Management who is Bolt's worldwide agent. "For many companies, this is the way they want to reach their target customers."
Olympic athletes traditionally had a short time frame to capitalise on their performance in the Games because they quickly fade from the public eye, according to marketing executives. But social media has allowed the athletes to extend relationships with fans by sharing messages, photos and videos.
Sponsorship now typically involve some social media promotion through an athlete's Twitter feed or Facebook page. Before the Games, for instance, Bolt posted messages about his sponsors, such as a picture of a refrigerator filled with bottles of the orange Gatorade sports drink
Athletes were not permitted to mention sponsors on social media without a special waiver until a period surrounding the Games, which ends on Wednesday. Advertisers that endorsed Olympians but were not official Olympic sponsors also were barred from promoting that connection during the period surrounding the Games.
Marketers that endorse Olympic athletes are expected to release a flurry of ads to congratulate athletes when that blackout period ends. Athletes also are expected to hit social media, thanking their sponsors.
Bolt is one of the most followed Olympians with more than 8m Facebook fans and 1.6m Twitter followers. Before the games, Bolt had about 620,000 Twitter followers.
Bolt's existing sponsors include Visa, Puma and Gatorade but he is looking to extend his brand further. Mr Simms said Bolt had recently released a new mobile game and is in discussions about using his signature celebratory pose on products ranging from luxury brands to toiletry items and Jamaican-inspired food products.
However, some athletes who experienced a quick leap to fame during the Games are likely to have a harder time translating that into new sponsorship deals.
Gabby Douglas, the US gold medal winning gymnast, for instance, saw her Twitter followers spike to more than 654,000 from 29,000 before the Games.
While she now ranks among the most sponsorable athletes, her appeal to marketers is likely to drop relatively quickly after the Games because of the short tenure of most gymnasts and a lack of interest in gymnastics throughout the rest of the year, industry executives said.
Marketers that endorsed her before the games, such as Procter & Gamble, are likely to see the most benefit.
"There is no arguing that Gabby's value as an endorser is exponentially more valuable now than it was when they signed her," said Kevin Adler, founder of Engage Marketing, a Chicago sports and entertainment marketing company. "If I am a creative and smart athlete agent, I would include bonus clauses that trigger financial incentives if social media audiences grow."