a failure in public relations
Newcastle United Football Club is in a mess. There is no denying this statement, and little evidence that it has the savvy or desire to extricate itself from the fiasco that has engulfed it. However, it is the board's prerogative if they want to drag out the situation.
The problem is that their failure to extinguish the flames of controversy is beginning to damage the reputable names of their sponsors, namely Adidas and Newcastle Breweries.
The sponsors are not in a unique position; many before them have suffered the same insidious fate of death by association. Yet many have managed to disengage themselves from their associations, so why not Adidas and Newcastle Breweries?
The answer seems to stem from the fact that they do not believe that any wrong-doing has taken place, preferring to refer to it as a slight hiccup in an otherwise happy relationship.
For instance, the selling of the Newcastle shirts to fans at such an exorbitant mark-up looks like no mean misdemeanour. Presumably, you would think, the sponsors are not happy with this situation. Well not exactly. Adidas's press statement includes a comment about the price of the shirt being in line with the industry standard, whilst Newcastle falls even to mention the topic.
It is difficult to believe that anyone or any company is advising the sponsors on how best to handle press inquiries. However, you would assume that written into the contract should have been a clause relating to adverse publicity - presumably on the lines that in the event of a dent in the reputation of either party - if the situation falls to be resolved tout de suite - then compensation might be appropriate.
But sports sponsorship is a rocky road to tread. The communications agency FCA! says that when developing business relationships it spends a great deal of time researching potential clients and sponsors, marrying up their strategic profiles and delving into their past history and company background.
FCA!'s chairman and chief executive officer, Chris Parry, believes that, unfortunately, many deals are struck on instinct, and are not necessarily founded on business acumen. He is scathing of the way the sponsors, or their PR companies, have failed to try even to control the negative situation, believing that none of them ever developed a formulated strategy to handle negative publicity.
It seems that these two sponsors failed to recognise that every coin has a reverse side. This is naive. Aside from any obvious synergy, the brands should complement each other, so that, although distinguishable, they are relevant to their target audience and compatible strategically. However, what both parties missed, in this instance, is the realisation that things can, and do go wrong. The parties should have an annual meeting specially dedicated to formulating strategy to handle events of this nature. Perhaps they already do.
Kinross and Render, a leading PR company, believes that preparation is the key to managing a crisis. Mature organisations have detailed procedures and processes in place that can be put into operation on receipt of a telephone call. Often it is the first few minutes and hours of such a crisis that determine whether the organisation will preserve its reputation and successfully manage media and public perceptions as the story unrolls. Above all, information needs to be managed and messages must be consistent. People need to see that the organisation is making the best out of a bad situation by being as up-front and honest as possible. If blame is to be attached, it must be so on the basis of the facts, rather than speculation.
That past, present and, presumably, future master of public relations manipulation, Richard Branson, after one of Virgin planes experienced "severe" mechanical difficulties - I think it was something to do with the failed descent of an undercarriage - turned a potential air disaster into a hero's welcome for the pilot. The story was so well handled that it has to be assumed that the PR department had been pre-prepared for such an eventuality. Pepsi, too, did a fantastic job removing itself from an association with Michael Jackson. So why can't Adidas and Newcastle Breweries?
Chris Parry of FCA! also believes that Virgin would have handled the Newcastle situation with more panache and circumspectly. Branson would have reacted swiftly to any suggestion that he made 1,000 percent mark- up on shirts with a carefully calculated promotional offer, or by defusing the situation by focusing on another, less hurtful topic. However, Parry believes that the situation could have been brought to a dramatic and immediate halt by the resignation of the thoroughly disgraced board members.
Adidas and Newcastle Breweries missed an opportunity here. They should have clubbed together and voiced their joint disapproval. Instead, woolly press statements have been issued. The one from Newcastle is as follows: "This has certainly been a traumatic week for all involved with the club, and we have no wish to reflect back on those events." I bet not, but once again their failure to criticise is tantamount to endorsement. In the modern world, public opinion is heavily influenced by the media in its various forms. Adidas is equally mealy-mouthed about the event, having issued a statement that includes a few words about the shirts being well within industry standards, and listing the recommended retail price. Yet neither will be drawn on the question of whether the board of Newcastle, an organisation that they sponsor, and have been proven to show such disregard for their fans and women in general, has done anything untoward.
CbH chief executive David Moore believes that the cause of the problem for the sponsors could lie deeper, suggesting that a long-term sponsorship deal is laced with hidden dangers. He suggests that sponsorship deals, like marriages, can end in disaster if the respective parties develop in different directions. Moore prefers deals where the relationship focuses on supporting a theme or generic industry rather than a brand. For instance, Snickers supports football rather than a specific team. Moore suggests that the intangible relationship enjoyed by Snickers and football allows the sponsor to cherry-pick their associations. These relationships bear the often quoted "one night stand" or "short courtship" tag, and can seem an infinitely wiser choice for sponsors.
Yet Simon Chick, of Company Barclaycard, believes that in order to make sponsorship work, a company has to be completely confident of its objectives and commercial perspectives. The company's sponsorship of the local football team has much to do with putting something back into the community.
The real issue is, however, should the sponsors in this case be more vocal in their disapproval of events? Their muted voice is galling to the fans, and an admission of acquiescence by the sponsors of the behaviour of the board. But let's leave the final decision to the great fans of Newcastle Football Club.
The writer works for SPS Marketing