Companies line up to pay millions to Phelps

It was one of the first questions fans started asking after Michael Phelps achieved the improbable feat of winning eight gold medals in one Olympics: What will he be worth?

Companies already lining up to hand Phelps millions of dollars to associate himself with their products. Some have even suggested that Hollywood snap him up to star as an aquatic superhero.

Phelps has secured his status as the star of the 2008 Olympics, but he has gone beyond that, said Bob Dorfman, who studies the marketing potential of Olympians for Baker Street Partners of San Francisco.

"I can't see any other story surpassing his," Dorfman said. "People just can't believe what he's been doing. There is a superhuman aspect to it. From that standpoint, he's hard to top."

Some marketing experts wonder if Phelps will remain hot during the long downtime between Olympics but for now, they say he has doubled his earning potential to at least $10 million a year and could become one of the richest Olympic endorsers in history.

Companies such as Visa, Speedo, Omega, Hilton and AT&T agree and have signed deals with the all-time leading gold medal winner. Visa had a new commercial, narrated by actor Morgan Freeman, ready to roll as soon as Phelps won his last race.

AT&T's commercials, featuring a young woman as an obsessed "Phelps Phan," have been ubiquitous throughout the games.

Kellogg's will put Phelps' mug on Corn Flakes and Frosted Flakes, according to Access Hollywood. The swimmer's longtime agent, Peter Carlisle, told The Wall Street Journal that Phelps' Beijing performance will double his endorsement income and be worth an extra $100 million over his lifetime.

Phelps could certainly pull in eight figures over the next year, said Ryan Schinman, founder of New York City-based Platinum Rye Entertainment, which matches celebrity endorsers with Fortune 500 companies.

"Right now, the guy's got the world on a string," he said. "He's in that upper realm, not in terms of income but in terms of profile, with Tiger Woods and LeBron James and Lance Armstrong."

Persona intrigues marketers

Phelps would be wise not to jump at every deal that comes his way, Schinman said.

Instead, the swimmer should expand and lengthen his existing deals with high-end companies. Those companies must in turn come up with campaigns that burn Phelps into customers' minds for a long time to come.

He should capitalize now, Schinman said, because given the low profile of swimming, Phelps' feats could be out of the spotlight come football season.

One person who doesn't seem very interested in marketing questions is Phelps.

"If (Coach) Bob (Bowman) and I were in it for the money, I think we'd be in a different sport," he said in Beijing. "I'm having fun at what I do, and I do it because I love it."

Marketers are taken with Phelps' regular-guy persona. In post-race interviews, he sounded confident and driven, yet a little taken aback by his achievements. People can imagine talking to him on the sidewalk, but place this aw-shucks character in the right context, and he's capable of otherworldly feats.

Great as he is, however, his sport rarely engages the
American public between Olympics.

Swimming has also never offered a wide launching pad for apparel sales.

Kids could walk around in Michael Jordan's Nikes. Well-paid adults can put on Woods' golf shirts and swing his clubs on the weekend.

But it's hard to imagine regular folks throwing on Phelps' skin-tight LZR Racer suit to swim laps at the neighborhood pool.

Sport has downside

In these respects, Phelps faces similar challenges to past Olympic giants such as Mary Lou Retton and Carl Lewis.

"His biggest downfall is that he's excelling in a sport that's not on the tip of everybody's tongue," Schinman said.

Retton was an endorsement darling coming out of the 1984 games, but with her competitive career essentially over and no sports apparel to hawk to a wide audience, her stardom could not endure.

She is still a recognizable name who can earn good money from speaking engagements, but you don't often see her in commercials.

That's not exactly bad news for Phelps, who will be able to stow millions now and earn a sizable income from his athletics fame for decades to come, marketers said.

"I think in the worst case, he's able to make a very nice income from speaking engagements 20 to 25 years down the line," Dorfman said, "but the nature of his sport will always be a challenge."

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