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Building a megabrand named Dwyane Wade

NBA star Dwyane Wade is changing the sports-marketing landscape. He isn't simply endorsing products, he's partnering with major brands to design items other than sports equipment and apparel.
Dwyane Wade
Many reasons to smile: After leading his team to the NBA championship last year, the Miami Heat's Dwyane Wade has scored between $15 million and $17 million in endorsement deals.Alan Diaz / AP file
/ Source: Business Week

Practice is over at American Airlines Arena, and Dwyane Wade takes a minute to explain how he's putting his touch on a new mobile phone. The All-Star guard for the Miami Heat and a self-proclaimed budding businessman is helping wireless carrier T-Mobile USA Inc. design a limited-edition Sidekick, the texting device/cell phone beloved by twentysomethings. "When I first saw the mockup they had with my signature, I said, ‘I don't want my signature on it,'" he recalls. "When people get my signature it should be exclusive." T-Mobile followed what Wade's gut told him: Print his name in block letters, feature his logo, and install a softer back for better grip and durability.

Wade, 25, clearly knows what he wants, both on and off the court. He has emerged as the leader of the Heat, despite playing alongside such veteran stars as Shaquille O'Neal and Alonzo Mourning. He's a three-time All-Star in just four years in the league and led the Heat to last year's improbable victory in the NBA Finals, when the team won four straight games after losing the first two. His Michael Jordanesque drives to the hoop and game-winning shots earned him the series' Most Valuable Player award. "Dwyane kind of snuck up on people with how great a player he is," says NBA legend Charles Barkley.

Being so hot on the hardwood has led to a soaring off-court profile: GQ magazine cover boy in November; Sports Illustrated Sportsman of the Year in December; plus endorsement deals with Converse, Gatorade, and Topps. Wade has also landed contracts with companies beyond sports, including Lincoln autos, Staples, and T-Mobile. All these deals total $15 million to $17 million, sources say. And now, Net search giant Google Inc. is in negotiations with Wade to try to revolutionize how celebrities are presented online.

Wade is changing the marketing landscape in ways other phenoms can learn from. He isn't simply endorsing products, he's partnering with major brands to design items other than sports equipment and apparel. On Feb. 17, the weekend of the NBA All-Star Game, the D Wade Sidekick — the T-Mobile device he co-designed — will debut with much fanfare.

What brand managers love about Wade is his wholesome appeal. In a league struggling to rid itself of the taint of brawls, criminal charges, domestic violence, and swaggering stars, Wade is a soft-spoken family man who married his high school sweetheart. He's not covered with tattoos. Modest and low-key, he's hip without the aura of urban menace. "He has the charisma," says agent Mark Steinberg, who represents Tiger Woods. "He has the qualities to become a great sports marketing superstar."

That's exactly what Wade and his high-powered handlers have in mind. Team Wade, led by agent Henry Thomas, aims to transform its young client into one of the top 10 brands in sports. They won't put a number on it, but to put their goals in perspective, Woods has earned an estimated $650 million from all sources since he started playing professionally. The idea, says marketing strategist Andrew Stroth of Chicago's CSMG Sports Ltd., is to create a global brand that transcends sports. "Forget his peers in the NBA," he says. "We want people to think of Dwyane Wade the same way they think of [David] Beckham, Jordan, and Tiger."

That won't be an easy layup, however. First of all, it's tough for a team-sport athlete to achieve megastar status unless he soars far above his peers, like His Airness. Second, marketing an athlete is never risk-free, even when he or she has a squeaky-clean image. And third, some sports marketing experts question Team Wade's choices of branding partners, saying that too many, like Converse and T-Mobile, aren't leaders in their fields. Says Stephen Wade Zucker, a Chicago-based sports agent: "You'd think he would be commanding the best dollars with the best brands. But he's not with the best brands."

Down to the shoelaces
Wade signed his first major endorsement deal, with Converse, before his first season, when he was a lesser figure in the same rookie crop as Cleveland's LeBron James and Denver's Carmelo Anthony. Converse, the shoe of Dr. J, Magic Johnson, and Larry Bird, lost its luster during the 1990s as Jordan made Nike king. The company has also suffered quality problems.

Wade's original Converse contract was worth $500,000 a year. But after Wade showed his mettle in the 2005 playoffs, the Converse contract was renegotiated to about $10 million a year. In contrast, James had signed a shoe contract with Nike Inc. worth nearly $100 million before he played one game in the NBA.

As part of the deal, Converse agreed to make not only Wade basketball shoes but also casual and active attire. He'll receive incentives based on the success of these breakout categories, says Ric Wilson, sports marketing chief at Converse. The latest Converse basketball shoe, the DWade 2.0, due in stores on Mar. 3, was co-created down to the shoelaces by Wade. Converse was bought by Nike in July, 2003, and Stroth, defending Wade's sticking with the brand, says: "Converse is backed by the Nike engine, and it gives us the opportunity to reinvent Converse with Wade as the face."

And although it's not as big a brand as AT&T or Motorola, T-Mobile presented a special opportunity, says Stroth. The carrier is a $100 million sponsor of the NBA. That means whatever marketing activities T-Mobile and Wade engage in can be tied to NBA events. In T-Mobile ads and promos, Wade can sport official NBA gear rather than generic apparel.

Adds Stroth: "We went after T-Mobile because he was excited about it. That's an important part of our strategy—to translate who Dwyane Wade is as a person." Wade, after all, already used the Sidekick and suggested a white and gold color scheme reflecting his taste. "You see me, you see my Sidekick," he says. "I don't go nowhere without it."

When the D Wade Sidekick is unveiled, T-Mobile will unleash a multimillion-dollar campaign "unprecedented" in NBA history, sources close to the league say. A huge billboard, featuring Wade in cream and gold with the new phone, will stretch over 20 stories of the Mandalay Bay hotel. "This is much bigger than anything we've done before because of the stature that Dwyane has," says T-Mobile marketing chief Michael Butler.

But the most innovative aspect of the Wade branding campaign may be its Web strategy — which was born from a moment of serendipity in the sky. Team Wade had already launched a Web site but knew they needed to leverage the Internet more effectively to engage his young fans. On Oct. 17, on a flight from New York to Chicago, Stroth sat next to a Google executive. They agreed the two camps should meet.

Living the digital life
The next week, in Chicago, Google reps preached moving beyond "independent sites" such as Wade's. Those sites, along with charity appearances, TV ads, and video games, make for an "episodic" relationship between the athlete and fans. But digital media allow for brands to be built daily or hourly—what Google calls "dialogue" marketing.

Wade, a Google user himself, liked that concept. So Team Wade gave Google the go-ahead to develop a plan that would make an integral part of fans' daily digital lives. Wade's camp and Google are in talks that they hope to conclude by the end of March. The goal? A fully interactive site built by Google with Google Search functions embedded. Fans would get a customized mix of e-mail, sports news feeds, flash games, and promotional messages. Hundreds of Wade basketball videos exist on Google and YouTube, and Stroth wants to link them to Wade's site. "This notion of user-generated content is unbelievable," Stroth says. "We want to fuel that."

Such a Digital Age strategy, Wade figures, will put him a step ahead of rivals such as James and Anthony in the race to be the next Jordan. Talking about brand-building in Miami's arena, his Sidekick in one hand and a basketball in the other, he shows a flash of the ferocity he brings to late-game heroics. "No question about it," says D-Wade. "I want to be the No. 1 guy."