As reported earlier, AutoNation and John Elway are parting company in the Denver market.
In that blog I speculated that Mr. Elway probably wanted more than AutoNation was prepared to pay to license the 17 dealerships they own that carry the marque name of Elway.
Seems the real story is a little different: Elway wanted to again be a dealership owner in his own right, and of course, he wanted to use his own name. So now that his original contract with AutoNation expired, he grabbed the opportunity.
Perhaps AutoNation would have renamed the Denver dealerships “GO” as they are in the process of doing nationwide. (I would have opted for keeping the Elway name if it was at all possible.)
But this brings up another issue for all branders who enter license agreements – whether for a name, the use of a song, the voice or image of a celebrity spokesperson: what happens when the contract expires?
That’s something a brand owner should consider when making the original offer. But just considering it is not enough. Utilizing a current fad celeb, and there are four or five on every TV screen in that category, may be problematic in four areas:
First, their popularity may be fleeting and you’ll end up with a dated brand in a year or two.
Second, they may pull some stunt – either drunk, high or just emotionally charged – that could tarnish the image.
Third, the celebrity may not renew, or ask more than the brander is willing to pay at the time of renegotiation, and thus the need to establish a new communication program which can cause a “disconnect” from the previous communications.
Fourth, the celebrity can “overpower” the brand, making the communications more of about him or her than the product and its attributes.
My thought that a brand should be differentiated in a relevant way through customer benefits, a company’s social responsibility, their service policies and distribution channels, the use of images and memes that convey a real promise.