BUSINESS
04/29/2013 07:50 pm ET Updated Apr 30, 2013

Jason Collins May Get Big Endorsement Deals

AP

Before Jason Collins came out as the first male gay athlete in a major U.S. sport, only devoted basketball fans and the loyal followers of the Washington Wizards knew much about the backup center.

Now Collins is the talk of the nation, and it’s already evident that he’s going to be of some value to big brands looking to capitalize on his newfound fame.

Collins will be more than a niche name valuable to brands that want to reach out to the LGBT community, explained Mark Elderkin, the CEO of gay media networking firm Gay Ad Network. He will be mainstream, and that’s why he could make a boatload of money from sponsorships.

“I don’t see that he’s going to be chosen as a spokesperson to help drive products sales within the gay community, but more to drive sales in the more general market,” said Elderkin. “The sports brands are obvious, but I think it goes beyond that. I guess the sky’s the limit.”

Elderkin predicts there will be a bidding war to determine Collins’ value. “You’re what someone’s willing to pay for that endorsement,” he said.

But even with America’s sudden attention, Collins must go through the same vetting process every athlete experiences when courted by brands. Paul Swangard, the managing director of the Warsaw Sports Marketing Center at the University of Oregon, noted that Collins is still not a sure bet.

“There’s no question there are a number of new possibilities that are presented to him in the wake of this announcement, but it still falls into the formula we use for marketing athletes,” said Swangard. “Is there a consumer base that this athlete can now connect with? Is there enough visibility that a brand can see value? Does the athlete move the needle?”

“He’s still got to demonstrate that his character and charisma are able to connect with people’s pocketbooks,” he added, noting that Collins is not yet in the “upper echelon” of marketable athletes.

Some companies might be hesitant to sponsor a gay athlete, considering the backlash against those who made positive statements about LGBT rights. J.C. Penney, for instance, unleashed a storm of criticism when it featured Ellen DeGeneres, who is openly gay, in an advertising campaign, and conservative group One Million Moms quickly encouraged its followers to shun the department store chain.

Elderkin dismissed anti-gay groups as mere annoyances that don’t significantly affect sales. “The kind of fear that advertisers had isn’t around much anymore,” he said.

Still, it depends on the individual brands and which consumers they target. Some brands may not consider Collins’ sexuality a positive attribute. “It’s always about starting with your business objective,” said Swangard. “What are you trying to accomplish with your partnership? Who’s your audience?”

Collins is already a Nike athlete, but it remains to be seen how the brand will use him. Before Collins announced his sexuality, Nike was already seeking to sponsor the first openly gay male athlete in a major sport, according to a report from Bloomberg News. The company just happened to have the prize fall right in its lap, and it’s unlikely to let Collins slip through its fingers.

“We admire Jason’s courage and are proud that he is a Nike athlete,” the company said in a statement Monday. “Nike believes in a level playing field where an athlete’s sexual orientation is not a consideration.”

Wayne DeSarbo, executive director of the Center for Sports Business and Research at Penn State, said Nike needs to move quickly with Collins; after all, he’s a 34-year-old free agent with no guarantee he’ll play in the NBA next year. Even if he does, he may not get the minutes to maintain the attention of consumers.

“The value to [Nike] is going to be contingent on his being able to secure another job some place,” said DeSarbo. “It’s probably to their advantage to move as fast as possible and to jump on that sooner rather than later. If he can’t find a job, what are you going to advertise?"

Collins likely has a little bit more leverage in the free-agent market now than he did before his announcement, said Swangard, but at the end of the day, he will have to perform on the court in order to be relevant both to major brands and to an NBA team.

“This is almost like the conversation that we had when Jeremy Lin moved to Houston,” said Swangard, in reference to the marketing power of “Linsanity,” which propelled the undrafted Harvard graduate to prominence in 2012. “Each of these athletes is a brand. Collins now has dimensions to his brand that make him somewhat unique.”

No matter what happens to Collins's career in the NBA, he’ll always have his big coming-out day under his belt. Elderkin cited this as a valuable “first-mover” advantage for Collins, even if more athletes start coming out as gay in the near future.

“He’s always going to be the first gay guy to come out in pro sports,” said Elderkin. “He’s never going to lose that.”

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