What Michael Jordan’s Supermarket Lawsuit Teaches Us About Business

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Michael Jordan Michael Jordan relied on natural talent and an unrivaled competitive streak to dominate the basketball world. But off the court, his federal case against defunct supermarket chain Dominick’s for the use of his name and identity without permission in a 2009 ad in Sports Illustrated has shown his business skills are nothing to sniff at either.

Whether he wins big or loses with the jury, he brought the case knowing he’d walk out of the courthouse the same way he walked in — fabulously wealthy and successful.

Here are a few lessons from his case:

—Protect your brand: It’s the only thing you have, according to branding and consumer experience expert Peter Shankman. “The brand is the one thing that sticks with you from beginning to end,” he said. “If your brand isn’t perceived the way you want it to be, it’s not Twitter’s fault, it’s not the media’s fault, it’s your fault. And that essentially means think before you do things,” he said.

“It’s critically important for individuals and companies to do everything possible to protect their brands,” added personal branding expert Ron Culp, an instructor at DePaul University’s School of Communications. “They have their own vision of what they will do and who they will affiliate with, and they have to be very cautious to make sure it’s consistent with how they are projecting their brand image.

“When you do see a Michael Jordan product, the believability factor goes up, which is good for the product and Michael’s brand.”

And if Michael Jordan is worried about his brand, then we should all be worried, said Tim Calkins, a branding expert and professor at Northwestern University’s Kellogg School of Management. “He’s such a positive brand you’d think he wouldn’t worry, but if he’s concerned about this little piece of advertising, then we should all be worried about brand,” he said.

—Don’t overexpose yourself: Jordan’s agent, David Falk, boasted in court that Jordan was the “best-known celebrity in the world,” but he didn’t get there by signing every deal that was put in front of him. It’s Economics 101: There’s only one Michael Jordan, and by limiting the supply of his endorsements, Jordan drives up the price his services command.

But it doesn’t stop there. Both Falk and Jordan adviser Estee Portnoy testified about how Jordan forced his sponsors to sign long-term contracts as his retirement approached. With skin in the game, Nike, Gatorade and Hanes had a strong incentive to continue promoting Jordan even after he hung up his sneakers. As a result, more than a decade after his retirement, Jordan earns more than LeBron James.

—Dress like $10 million: Skill alone hasn’t carried Jordan to the top. From the basketball court to business, style has boosted his fortunes. From the beginning, Jordan let his own instincts be his guide, from his Air Jordans, whose black, white and red color scheme violated NBA rules and earned him fines each time he wore them in a game, to the baggy Bulls shorts he requested so he could fit his North Carolina shorts underneath. In defying dictates, Jordan often set a new standard.

Jordan sticks with his sensibilities even when trends move in a different direction. Jordan continues to favor a roomy silhouette, evident in the suits he wore to court. In that regard, Ge Wang, a Chicago tailor who counts professional athletes including the Bears’ Matt Forte as clients, would counsel Jordan to evolve. But Wang also gives Jordan points for consistency, a key aspect of proving he has a brand to protect.

Even mere mortals can take cues from his example, using individuality to abet their ascent.

“Michael Jordan knows his distinct style,” said Wang, owner of ESQ custom menswear. “A strong takeaway is to really own your look.”

When choosing which sartorial rules to break, Jordan illustrates that quality materials and impeccable craftsmanship can deflect reproach. Wang said Jordan is using some of the finest fabrics available for his clothing, on the level of Scabal and Loro Piana.

Buying the best quality you can afford, even if you buy less, is a rule that many high achievers learn early and heed forever.

—Surround yourself with smart people:
As anyone who remembers Jordan letting John Paxson take the winning shot of the 1993 NBA Finals knows, His Airness can delegate. That translates to the business world too. While he was clear in court that he has the final say on every deal he signs, Jordan hires the best people and trusts them to deliver.

It’s 31 years since Falk won a bake-off of sorts between competing agents to represent Jordan by comparing him to the world’s most expensive diamond, and while he no longer represents Jordan, Falk to this day remains a close adviser and friend to Jordan.

Falk’s bold talk had a comical aspect — has anybody ever sounded so offended by an offer of a $26 million endorsement deal as Falk did on the stand? But by the time Falk was done testifying, Jordan seemed every bit the billion-dollar man.

Jordan chuckled throughout Falk’s testimony. As well he might: The smartest people in the room were all working for him.

—Pick your enemies: Jordan has been criticized by some in the media — and by a judge no longer involved in the case — for being “greedy” in his $10 million demand of Dominick’s. But in suing a supermarket company that spent $503 million on advertising and promotion in 2009, Jordan isn’t exactly picking on a weakling.

The fact that Dominick’s closed in 2013 means that its owner, Safeway, can’t rely on jurors who shop in its stores for sympathy. And regardless of the outcome of the case, the fact that Jordan was willing to bankroll more than five years of expensive legal arguments to bring it to trial will give any other companies thinking of using his identity without permission pause, while keeping his legitimate sponsors happy.

Jordan’s lawyers also go after small-time counterfeiters who sell fake Jordan gear on eBay. But they typically send only a cease-and-desist letter in such cases: A guy printing T-shirts in his garage isn’t worth suing, compared to a publicly listed company like Safeway.

—There is no such thing as a free lunch:
Both Dominick’s and Jewel (a grocery chain that is also being sued by Jordan) used Jordan’s name in ads in a special commemorative issue of Sports Illustrated that honored Jordan’s elevation to the Basketball Hall of Fame. The magazine offered free ad space in return for a promise of shelf space and encouraged the supermarkets to play on Jordan’s image in their ads.

Sports Illustrated got what it wanted with its “free” offer. Dominick’s didn’t. Only two customers redeemed $2 off vouchers for Rancher’s Reserve steaks attached to its Jordan ad.

(Source: TNS)