Ye or Kanye West as most of us know him, is of course a mega-successful rapper, songwriter, record producer and fashion designer. He's possibly one of the most famous people on the planet. He was married to the equally famous Kim Kardashian until not very long ago and, like Elon and Boris, he's one of those rare people who can be instantly identified by their first name.
Image source: Wikimedia commons
You no doubt think Kanye's mega wealthy. But Kanye's no longer a billionaire. That's because things have not been going very well for him lately.
We'll go back a bit
Kanye had a partnership with sportswear giant Adidas, a deal worth USD1.5-billion according to Forbes. The deal entailed Kanye licensing (authorising) Adidas to use his brand, Yeezy, on footwear.
A sure-fire winner you might think!
Commercially, it was clearly destined to be a winner. But unfortunately, Kanye went off script: he made anti-Semitic remarks. Needless to say, the public reaction was not at all good. And when there's even a whiff of scandal savvy brand owners tend to act decisively. Adidas didn't mess about: it cancelled the whole deal.
Image source: Unsplash
Which, of course, wasn't great for Adidas
That's because, according to reports, the company is likely to lose some USD250-million in net income in 2022.
But even worse for Kanye
Other companies dropped Kanye too - brands like GAP, Foot Locker, TJ Maxx and Balenciaga.
More on that billionaire thing
Kanye no doubt enjoyed being a billionaire, but his wealth has shrunk quite drastically as a result of the Adidas termination. According to Forbes, Kanye is now down to his last USD400-million. This assessment is apparently based on Kanye's real estate, cash, music catalogue, and 5% share in Kim Kardashian's firm Skims.
One fan actually created a GoFundMe page to help Kanye get back his billionaire status, but this hasn't had the desired result. Other fans were a bit more selfish - they created GoFundMe pages, pleading for donations to make themselves billionaires!
There have been further repercussions
It's been reported that Kanye pitched up uninvited at the offices of Skechers, seemingly with a view to persuading the company to go into business with him. But Skechers was having none of it, and Kanye was marched off the premises. The company issued this statement:
"We condemn his recent divisive remarks and do not tolerate anti-Semitism or any other form of hate speech. The company would like to again stress that West showed up unannounced and uninvited to Skechers corporate offices."
In fact, there's been something of a chain reaction
Foot Locker, a footwear retailer, said that it would not support any future Yeezy "product drops", and it instructed its retail operators to pull existing products from shelves and digital sites. Whereas Christie's, the auctioneers, has dropped out of a sale of rare Nike Air Yeezy 1 proto-type worn by Kanye to the 2008 Grammy's.
Reactions from Kanye's fans have been mixed
According to a BBC report, one fan said this of Kanye: "I was a fan .he is a genius in the fashion industry and in the music industry. It does feel like he's almost attention seeking to stay relevant. And he's just a little bit too far out there with me. There's certain things you just can't agree with."
Whereas another (delusional?) fan seemingly tried to rationalise things: "I almost see Yeezy as a brand separate from Kanye West. Obviously he controls much of it, but for some reason I see Yeezy as separate. So I will continue with it."
Finally, some law
A person quoted in a BBC report said this: "It's dangerous for any brand to rely so heavily on one influencer to drive such a huge portion of their sales." Which brings me to some legal considerations.
It is quite common for brands to partner with other brands. Partnerships can take many forms, for example: the appointment of a brand ambassador or influencer; the appointment of a licensee; a co-branding arrangement. Partnerships may, in many cases, prove to be very profitable. But there are obvious risks, and these should be mitigated. By doing things like this:
- due diligence as regards the potential partner;
- monitoring what the partner actually does;
- clear exit clauses;
- penalties for infractions, and,
- dispute resolution clauses.
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