Pitfalls of Deals & Obtaining Sponsorship and Endorsements

Earlier this month, I’m sure you've seen the Champs Sporting Goods commercial starring 2 Chainz.  Apparently, he’s inked a deal with Adidas and Champs to represent the companies to “the hood”, to say, “hey, if 2 Chainz is wearing Adidas and doing this commercial for Champs, then Adidas and Champs must be aight”.  I mean, this is a come up for 2 Chainz, because there’s nothing wrong with earning endorsement dollars; but the motive behind the deal is what irks me.  These companies are using 2 Chainz’ 15 minutes of popularity to capitalize on a greater level to bring back the urban consumer.  Since 2 Chainz is one of the most popular recording artists in rap right now, the companies see an opportunity to use him as a puppet to draw in fanbase.  They use him to get their message across by having him wear their clothing line and advertise the store where the line is to be sold.  It’s marketing, yes, but it’s all an act.

Adidas and Champs have found an individual who the listening audience may follow to sell their products and enter their stores just because he has a few hot songs right now.  Apparently, both companies are in a rebirth period and need someone to advertise for them to the urban community, where most of the money will be generated.  And in the process, if the campaign works, how much of the revenue will 2 Chainz get?  If people weren't wearing the new Adidas and going into Champs before 2 Chainz started peddling for them, and both companies see a spike in revenue, 2 Chainz should receive his payment from his contract plus major points from sales on top of his contract.  This all depends on his written agreement with both companies.  If he believes he can increase the revenue stream to both Adidas and Champs, he should have in writing that he is to receive points on extra revenue gained by both companies.  They are using him for just that reason, and he should benefit financially from that as well.  A basic agreement is cool, but the incentive would be even sweeter.

We all know you have to slave in the industry to make money if your album doesn't sell or you signed a janky contract.  When I say slave, I mean tour consistently, for long periods of time, just to break even, or even eat.  Let this be a lesson taught to all you independent artists out there, if you want to get some money, find a sponsor or some company to endorse you.  Don't be fooled by the glitz, glamour, and false lifestyles presented that you see in these videos.  I'm sure most of you are old enough and educated enough by now to know that a lot of these artists are not living what you see on television.  But getting those corporate sponsors to back you is where you can make money and not having to worry about paying it back to someone, or someone taking a percentage.  With obtaining a sponsor or endorsement, you don't owe anyone anything if your run as an artist doesn't work out as planned.  You won't be bound to a contract and you won't have to a slave to the label you're signed to for the rest of your days until you work off that debt.  You will be indebted to that label until they feel you have zero value and decide to let you go.

If you didn't know, debt is slavery.  There have been artists signed to labels for years and even decades without putting out material because the label makes them suffer.  The label won’t allow them to work in the studio to make any material to work off the debt owed, thus keeping them under their thumb.  There are instances where an artist is allowed to work, to get that last album or two owed, so they may fulfill that contract, but the producers or the label head themselves will say it’s not to standard, and to get back in the booth to slave even more.  Some artists are cut off from the label, yet still signed, and all they can do is shop unofficial mixtapes to make money on the side so they can eat, because they aren't touring or making music for their label and they are reduced to peddling their time and music to live.  Even if it’s something like advertising, no matter how little it was, it was in the line item to your promotion, and if you don’t make any money for the label, you will owe them until it is paid off by your blood, sweat, and mostly tears, or they decide to write you off like a bad debt.  So try your damnedest to avoid being someone’s debt (slave).

Even on a personal level, avoidance of having debt means paying off credit cards, charge cards to department stores, bills of any sort, because if you don't, they'll compound interest and fees on you to prolong your status as a slave to them; causing you to be indebted to these establishments for as long as you still owe them; and with these types of establishments, they will write you off as a bad debt, but in the same process, refer your account to a debt collector, who, by some accounts, operate by almost no rules.  And if you refuse to pay the debt collector, they report you to the BEAST, the Internal Revenue Service (IRS), and then you’re dealing with a different animal.  From that point, the IRS will recommend you pay the debt or have your wages garnished.  Your credit score may take a significant hit as well, if you don’t pay your bills on time.  From that point, attempting to apply for more credit, obtain a job, and buy a car or house will be much tougher due to the report of you not paying your debts.  It’s sort of like a slave master not willing to let go of his slave until he’s fully picked the cotton field clean.  So try not be anyone’s slave.

Back to 2 Chainz, and obtaining endorsements and sponsors; you all need to go out and request your local establishments and even the heavy hitters like your favorite soft drink or clothing companies for a partnership.  2 Chainz is getting $100,000 per feature, and he’s featured on plenty of records, on top of his album selling gold (500,000 units, plus), so he’s paid (unless his deal is back loaded, and he won’t see any money until all his advertisement, promotion, travel, and any other expenses that are line items in his contract to pay for his exposure are paid off).  Endorsements and sponsorships are the cherry on the top for him, but to an independent artist, obtaining these types of deals are key to making any kind of money outside of small shows or appearances, when in actuality, some artists pay a small fee to make appearances on radio and small, independent internet and television programs.  So, as I stated earlier, though 2 Chainz is a puppet to Adidas and Champs, I say that because he has money, and they are using him to make more money off his “endorsement” of the product.  But to an independent artist, who isn’t selling records or doing shows, getting endorsement and sponsorship money is a way to supplement their studio time or stow away for personal use, if managed properly.

As I stated on the Thanksgiving Leftovers episode of the radio show, you can even choose who you want to get money from by going to them.  If you have a favorite drink, clothing line, food, etc, contact them, with a plan, present yourself, and sell yourself.  The more positive you approach these companies, the better your chances of scoring a deal.  To the endorsement and sponsorship companies, your status in the community and in the regional industry, even as an independent, is cheap advertisement to them.  Instead of spending thousands of dollars on advertisements in the urban areas, such as billboards, and local television, they pay you to say their name or to wear their apparel.  You are not their puppet because you approached them, in your grand scheme to create a new revenue stream.  Though there are terms and conditions to follow when entering these deals, if you read them and you work hard and stay straight, maintaining the deal shouldn't be a problem.  These deals are most likely your sole stream of making money as an artist, so you are not selling yourself out to make money because you are still who you are, and it was your decision to go with that company.  It's more money than you'll probably see selling a record at this moment as an independent, but at least you don't have to pay back a dime as if you’re signed to a record deal.  These deals are held to a period of performance and expire.  If the companies see that you are progressing as an artist, and doing some good for your community, they will re-up the deal, and possibly increase the payout.

So attracting a sponsorship is a great way to put extra money in your pocket as an artist.  Use the money wisely, and in the process, get some free merchandise out of it.  Follow the terms and conditions of the deal, and it’ll be easy to maintain that steady stream of free cash.  The only work is to shout out the product or even wear it to events.  You can’t be stubborn and not want to do that little bit to get a lot.  Put that ego to the side if you’re endorsed by a lesser known entity and have to wear it to a show or event.  If you want the big companies such as Ralph Lauren, Tommy Hilfiger, Invicta, Grey Goose, Sprint, etc, companies to endorse you; then you have to go to them with a clear cut business plan, and stay motivated and positive throughout to maintain.  That’s the road to PROSPERITY and not to SLAVERY.