Phelps has gone global. A huge marketing machine behind Michael Phelps hit the ground running with a strategy in place to make him a global brand – and even richer.
A day after Phelps won his eighth gold medal at the Beijing Olympics, making him the most successful swimmer and Olympian of all time, corporate executives emerged from poolside well prepared to capitalize on his new-found fame.
But Phelps, 23, who was looking forward to going home to Baltimore to see his dog and visit with his friends and family, was unfazed at being called the hottest marketing tool to ever emerge from the Olympics and at his new celebrity status.
“It’s not about the money. I do what I do because I love it and that’s why I’m here,” Phelps said during an interview organized by one of his sponsors, the credit card company Visa, in an ornate chamber of the Prince Jun Palace in Beijing.
“I see myself as a normal person and the same kid I was four years ago, so I’m just living a dream right now,” he said.
Visa, which has sponsored Phelps since 2002, said the swimmer’s success at Beijing raised his visibility and would make possible a global campaign based around him.
“Michael Phelps is leaving Beijing as a global sports icon. He’s now with the likes of the Michael Jordans, Tiger Woods and Roger Federers and he’s earned every bit to be in that elite company,” said Michael Lynch, head of global sponsorship at Visa.
Phelps first became marketable after winning six gold medals at the 2004 Games in Athens. He has had a financial adviser for the past five years to help him manage his income and recently bought a house in Baltimore that he will move into after the Beijing Olympics.
But his success at the 2008 Games has put him in a different league, with a record 14 gold medals to his name, and on track to become the richest swimmer ever.
“This absolutely changes the game. The values will change, the depth of the programs he is involved with will change, the breadth of these programs will change,” said Phelps’s agent, Peter Carlisle.
Before Beijing, it was estimated that Phelps’s sponsorship deals earned him about $5 million a year, although Carlisle, who has acted as Phelps’s agent for six years, would not confirm this.
But as Phelps won gold after gold at Beijing, his appeal soared and television audiences in the United states, the world’s biggest media market, watched his victories in record numbers.
Joyce Julius & Associates, a sponsorship evaluator, estimated that Phelps’s air-time value to Speedo, another one of his sponsors, was $3.6 million after winning five golds – more than justifying the $1 million bonus that Speedo paid Phelps for matching Mark Spitz’s record of winning seven gold medals at a single Olympics.
Carlisle said that previous Olympians had struggled to stay in the public eye between the Games but that he was confident that Phelps Inc. would maintain its momentum because of a multilayered marketing strategy that was not focused only on swimming competitions.
Phelps has made it clear that his goal is to raise the profile of swimming.
As well as the advertisements for sponsors, he created a social network site for swimmers (www.swimroom.com) that sells merchandise like “Michael for President” T-shirts. He has also completed a documentary on swimming, runs swim clinics and has taken on various TV roles.
“You can’t compare the platform he has now to anything that any swimmer has had in the past,” Carlisle said. “He has worked to develop promotional platforms that can exist between the Games, irrespective of whether there is a competitive event.
“I think he can make swimming much more than a once-every-four-year sport in terms of relevance to the general public,” he added.
But could Carlisle put a value on Phelps, which some marketing experts estimate could be worth up to $30 million a year? He said it was impossible to gauge but that the potential was enormous.
“If the strategy works with each of these platforms and business engines are fueled, this amounts over time to arguably exponential growth in efficiency and in value,” he said.