The 2016 athlete endorsement season is upon us! Now is the time that most brands begin making marketing decisions for the following year and are approached by athletes to get sponsored (or do the approaching).

A question that we often get from athletes (and brand sponsors) during initial contract negotiations is so important that we think it’s worth blogging about. But before I do the big reveal, let us set the scene…

Brand A is interested in Athlete B because Athlete B is has a loyal following of fans and could be great ambassador for Brand A.  However, Brand A is a small company without a real marketing budget.  Athlete B could potentially change that by promoting their products. Athlete B, seeing dollar signs, wants to ask for as much as she can get. Alas, Brand A has few dollars at the present moment. Once both parties are at the dreaded negotiating table, they both ask…

Let us keep you in suspense just a bit longer. The “negotiation table” is the figurative place where parties with varying levels of experience try to figure out what the terms of a contract will look like and who will do what for whom. This is literally the most important moment for both parties to find a mutually beneficial understanding and determine clarity about deliverables. In our experience, there is a lot of room for improvement in this area.

So what is the question that we always get asked? Stated simply: “How do we get started?”

You might be surprised by this basic question. We have seen this question enough to know exactly what to do and it has everything to do with being prepared for the conversation. Having a plan for the negotiation from both the brand perspective and athlete perspective is crucial for living happily ever after…or at least through the term of the contract.

We recommend that athletes and brands start any negotiation with the following three steps; the first two steps happen before arriving at the negotiation table and the third step at the negotiations.

Step One

·      Brands should have a clear idea of how they think the athlete can help their brand and what kind of time commitment and exposure they want from the athlete.
·      Athletes should have a clear understanding of what the brand does and decide whether it is a good fit for their image/personal brand and whether there are any conflicts with any existing sponsors.

Step Two

·      Brands should think and write down what they see as primary and secondary deliverables that they want the athlete to be able to achieve. This could be public appearances, participating in specific races or events or generating content for the brand.
·      Athletes should think about how they can help the brand achieve its strategic marketing goals (usually more sales) and be a great asset for the brand.

Step Three

·      Brands should open negotiations by presenting how they see the athlete fitting into their strategic goals and be transparent about important things like athlete compensation and potential bonus structures.
·      Athletes should open negotiations by presenting how they see themselves fitting into the brand’s vision and lay out any compensation and incentive concerns.

The key in all three steps is being realistic. In our experience there’s entirely too much poker playing during negotiations. A small endurance accessories sponsor (socks come to mind) is never going to be able to provide large sums of money, but it could be a great fit to work together on original content that helps both the athlete and the brand grow.

It is also important for both sides to come to the table with best intentions. The athlete should see themselves as an “employee” of the brand and work hard to help the company achieve its goals. The brand should communicate well with the athlete so that he or she is clear on what is expected.

One final tip: help make the world a better place by being straight forward and honest. Happy mediums can be achieved in any negotiation if the parties want them to. Trust us, while this all seems super basic, we have seen too many instances where communication breaks down (or never gets started) because of lack of clarity. Follow these three steps and you’re assured better outcomes that result in happier athletes and brands (and sports agents).