It's not as if Nike (NYSE:NKE) is a stranger to controversy. It ran Hyperdunk ads that it ended up pulling because they were associated with violence and homophobia. It's had TV networks pull ads featuring Olympic stars being chased by chainsaw-wielding killers. It once depicted England's top football player Wayne Rooney as a Christ-like figure. When it comes to advertising, Nike and controversy go together like white on rice.
So the new Nike ad featuring Tiger Woods with the tag line "Winning Takes Care of Everything" shouldn't surprise anyone with the hubbub that has bubbled up around it.
Is Nike endorsing the golf great's past infidelity? Was it insensitive to his ex-wife? Should Nike -- or we -- even care?
The sneaker maker certainly doesn't. More than a decade ago, a then-executive was quoted as saying, "We have a history of making controversial ads, and we certainly have succeeded in that." Controversy is what helps it sell shoes, and last year it sold $25.6 billion worth of product, an 11% increase over 2011.
According to a Forbes article earlier this year, Woods' current contract with Nike is worth something less than the $30 million a year it paid him before the brouhaha, when it stood by him while others like Accenture, Procter & Gamble's Gillette, and PepsiCo's Gatorade severed their relationships (though Gatorade denied it was related to his infidelity; just timing, you know).
Considering Nike's golf business generated $726 million in fiscal 2012 and revenues were up 10% in the second quarter of this year, a bold, in-your-face campaign seems right in line with how Nike operates.
Contrast that, though, with how fast it dumped Lance Armstrong once incontrovertible proof of his doping scandal erupted. The difference, likely, is that Tiger's troubles weren't directly related to his performance on the links; Armstrong was winning races precisely because he cheated.
When looked at in comparison to some of its other ad campaigns, the current one really is barely worth a mention, though you can be sure Nike doesn't mind all the free publicity.
Fool contributor Rich Duprey owns shares of Nike. The Motley Fool recommends Accenture, Nike, PepsiCo, and Procter & Gamble. The Motley Fool owns shares of Nike and PepsiCo. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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