September 1 1998 by Joe Queenan
Several weeks ago, something unexpectedly wonderful occurred when Reebok Intl terminated its promotional deal with Los Angeles Lakers basketball star Shaquille O’Neal. Five years earlier, Reebok had convinced itself that the lumbering, slow-footed O’Neal was the future of professional basketball, the man who would one day accept the ceremonial passing of the torch from Michael Jordan when the indomitable Chicago Bull finally decides to step aside. With this in mind, the company enthusiastically agreed to pay him $3 million to endorse the Shaq Attack, a sneaker line intended to supplant the ubiquitous Air
Alas, in his five-year NBA career, O’Neal has proven to be a colossal choker, a truly gifted athlete capable of putting up huge, meaningless numbers during the regular season, but who rarely delivers when the chips are down come playoff time. Having suffered through a humiliating 4-0 sweep at the hands of the underdog Houston Rockets in the NBA finals four years ago, followed by similarly devastating sweeps at the hands of the Chicago Bulls in ’96 and the Utah Jazz in ’98, O’Neal now ranks as one of the biggest underachievers in the history of the game.
What’s more, O’Neal has been a dud not only on the court, but in other media, churning out a string of idiotic videos and unintelligent movies. In a world where image is supposedly everything-a phrase associated with one-time tennis wunderkind Andre Agassi, who at least won three major tournaments—image is actually nothing. That’s why Reebok finally decided to dump the big stiff.
O’Neal’s banishment from the ranks of highly paid endorsers was only the most visible action taken against athletic non-performing assets by the nation’s finest sneaker companies. In addition to O’Neal, Reebok also parted company with Milwaukee Bucks star Glenn Robinson, and reduced its total roster of jock endorsers from 100 to around 45. Meanwhile, Converse ended its relationship with fading Knicks forward Larry Johnson and axed Latrell Sprewell, the Golden State Warriors head case most famous for garotting his own coach last year.
Terminating contracts is away of punishing the players, which the hoi polloi absolutely love. But isn’t it high time some retribution was directed at the corporate officials who hired these clowns in the first place? What I’d like to see are some performance-based criteria stipulating that if a player gets $5 million a year, as the scandal-plagued Allen Iverson does in Philly, but his team doesn’t even come close to the playoffs, then the official who signed him up doesn’t get paid that year. Conversely, if the player did lead his team to the playoffs, or did manage to push a few hundred thousand pairs of sneakers out the door, the executive receives a commensurate financial reward.
The beauty of this compensation system is that it’s based on hard numbers. If an athlete is signed to a contract for the specific purpose of endorsing a particular brand of footwear, and the footwear does not sell, then solid, irrefutable data exist that will attest to this fact. Once the numbers are in, the executive who signed the jock to his long-term deal cannot turn around and claim that the endorser failed to produce because of seasonal weather patterns or unexpected currency losses in
I am certainly not suggesting that performance-based executive compensation should be limited to the field of sports. If a corporate honcho hires an actor to endorse his company’s meat products and the actor has to have a heart operation, somebody should walk the plank. Ditto the executive who inks a deal with a wife-beater, a drunken driver, or a racist. In each of these cases, punitive measures should be taken.
But what makes the world of sports so relevant here is that the punishment really does fit the crime. Businessmen love to use sports terminology when describing the work they do, even when the analogies are hopelessly inappropriate. But athletes, unlike businessmen, cannot “spin” their way out of defeat through nimble wordplay. Karl Malone, perennial also-ran, cannot blame a soft semiconductor market for getting stripped of the ball with his team ahead and the NBA championship on the line. He just got stripped of the ball. And he has to take responsibility for it. If executives love sports so much, they should do the same.
When news got out that Shaquille O’Neal had lost his sneaker contract, I and many of my friends were gleeful at the thought that the market-and the public-had finally caught up with this Gen X bum. But O’Neal did not create the absurd buzz surrounding his one-dimensional game and one-dimensional personality. Guys in suits did that. So my feeling is, if O’Neal has to carry the water for failing to produce big numbers, so should the people who lifted him onto a pedestal in the first place.
Obviously, this might be a problem if the guy making the endorsement decisions also happens to be chairman of the company.
Joe Queenan is a regular contributor on business issues, corporate culture, and financial follies to Barron’s and The Wall Street Journal.