The recent bold and commendable stance taken by Reebok in, very publicly, ending their partnership with CrossFit, is an encouraging sign for the industry. This article charts the downfall of the relationship, highlighting how Reebok have taken the correct course of action against a toxic rights holder.
Before progressing, we would like to state that the purpose of this article is not to judge governments performance on Corona virus or the BLM protests as there are enough comments by those more qualified to provide greater insights. We fully support the BLM movement and believe in a fairer more equitable world. We don’t mean to belittle the issues by not addressing these head on, however we want to focus on the Reebok/CrossFit issue, something we are far more qualified to comment on. This is because, whilst this certainly isn’t the biggest announcement to hit the sponsorship industry, nor does it involve the largest sums of money, we believe it is a significant step as it is rare that a sponsoring brand takes such quick and decisive action against a long term partner.
Sponsorship can be an incredibly powerful marketing medium which can be likened to a marriage. After an initial courtship, it is necessary to understand if values are aligned, and if so, if there is a possible foundation for a long-term relationship. Once this trust is established, partners must assess whether this relationship can be equally and exponentially beneficial for both parties. Finally, partners must also acknowledge and accept that there will be differences of opinion along the way. Without this foundation, sponsorship becomes an expensive media badging exercise. Understanding, respect, alignment and shared goals are the key to successful sponsorships and marriages alike.
The marriage of Reebok and CrossFit over the last 10 years has been very successful with brand loyalty and commercial gains being mutually enjoyed. It has been a profitable association for both parties as the global functional fitness movement has grown exponentially. When the sponsorship first started, Crossfit was a (relatively) niche community. In 2010, there were around 2,500 affiliated gyms, 10 years later this number exceeds 15,000. In 2011, 26,000 athletes registered to compete in the CrossFit Open, this number had risen to over 400,000 by 2018.
For those not familiar with CrossFit, this is not just another gym franchise, it is a huge, fanatical and extremely loyal community, sometimes being (lazily) referred to as a cult. Being a member of your local ‘Box’ provides entry to a world of like-minded individuals who have the common cause of helping each other in becoming fitter and healthier. CrossFit’s critics call it obsessive and dangerous; those within the community call it commitment. CrossFit is the Marmite of the exercise world, however whatever your views, you cannot deny its success or influence.
When assessing CrossFit through a marketing lens, its importance grows. Demographics is a bygone targeting device which has been replaced by tribe identification as the most effective segmentation planning tool. Arguably, the CrossFit tribe is one of the best examples of a highly influential global group (estimated at 4 million members) who can’t be boxed into a tidy age/income/geography/ethnicity box due to their diversity, however it’s a community who have similar outlooks and, most importantly, purchasing habits (health, food and apparel in particular).
Reebok took a punt in 2010 to support a, relatively, small fitness movement which came to reap huge benefits. The partnership worked incredibly well for them, at a time where the bigger players within the sports apparel category were committing increasing amounts of money into traditional rights holders. Reebok didn’t try to take their competitors head on, instead they identified a new movement within the fitness world. CrossFit and Reebok’s shared values of community, honesty, creativity and courage were the perfect fit. Whilst others within the category were activating around the genius of millionaire footballers, Reebok and CrossFit were helping to sculpt the ‘Fittest on Earth’. Whilst many won’t be aware of Rich Froning and Tia Clair Toomey, to the CrossFit (and broader fitness) community, these athletes are more inspiring, aspirational and accessible than Messi and Ronaldo.
It is worth stating at this point that, like all marriages, the CrossFit/Reebok relationship hasn’t always been smooth, there were bumps in the road. Public disagreements over royalty payments and commercial re-structuring meant that Reebok were considering if and how they should continue their relationship, which was due to expire later this year. However fundamentally, all was going well. Whilst other brands were starting to ambush the territory, if you were to walk into any CrossFit Box, there would be no doubt which apparel brand dominated.
However, whilst CrossFit’s approach has been controversial in the past, the actions of the business and its founder over the last few months have shocked most within the community. First, through their official social media account, they questioned the seriousness of the Corona virus during the initial spike of infections, then they began shaming people who may have got out of shape during the world-wide lock down. Finally, and most worryingly, the founder Greg Glassman mocked the death of George Floyd on social media and was then thoroughly unrepentant about it. Having subsequently realised the reputational and financial fallout, CrossFit have since apologised unreservedly and Glassman has been forced to step down as CEO (despite maintaining company ownership), however this does not excuse the expression of their initial views or mend the damage to associated commercial partners.
Over the last few years there have been terrible scandals involving global rights holders where sponsors have chosen to turn a blind eye rather than compromise their primary marketing platform. The IOC’s handling of the Russian doping scandal and FIFA’s awarding of the Qatar World Cup have both caused global condemnation, however very few sponsors took a stand against their rights holders; McDonald’s, Coke and Visa (to name just a few) continue to support these organisations. Fundamentally, these brands decided to live with the scandal rather than forego being associated with the world’s biggest events. We have always believed that this was a mistake. Refreshingly, the speed of Reebok’s response to Glassman’s comments has been both uplifting and significant.
Maybe CrossFit and Glassman thought they were untouchable or maybe they simply didn’t care. The fact is that the whole issue highlighted how far removed they had become from their business strength; their community. The CrossFit community is all inclusive; shape, size, age, colour, creed, gender and sexuality are all irrelevant. The common bond is supporting each other to be the best you can be irrespective of who you are or what you look like. Glassman forgot this and became detached from the foundation of his business. Not only are the views of the business and founder completely unacceptable but they were totally at odds with their community, proving that he had completely lost touch with them.
Whilst we praise Reebok for the speed and decisiveness of their announcement, it wouldn’t have been a difficult decision. If these comments alone hadn’t persuaded Reebok to walk away, the fact that CrossFit had lost touch with their community was compelling enough and would have made the decision inevitable. It had become obvious that the values of the two organisations were no longer aligned and, as a result, the sponsorship would have immediately stopped working. In fact, had Reebok not announced their separation, it could, and probably would, have had a detrimental impact on the business.
Like many marriages, sometimes partners grow apart or, as in this case, an abusive partner has forced irreconcilable differences. This has resulted to the inevitable end of the marriage which once seemed like a match made in heaven. Whilst it is possible that this decision might deliver Reebok some commercial pain, the long-term benefit of being outside this toxic relationship will undoubtably be positive as the CrossFit community outgrows Glassman’s organisation. This is the real opportunity for Reebok as they have the credibility within the territory and have recently proved that they are fully aligned with the community. We’re sure that this won’t be the end of Reebok’s involvement in the functional fitness territory, its just the start of phase 2.