Over the summer, there was this guy who won a bunch of gold medals, broke a few world records and became the focus of the nation.
Yeah, Michael Phelps might be better at swimming than anybody else has ever been at doing anything.
The Olympics have a short period of relevance, but Phelps appears to have transcended the Games in America. He has become one of the more popular athletes in recent memory, but who stands to profit from his success?
After winning a measly six gold medals in Athens in 2004, Phelps pulled down $5 million a year in endorsements. In 2008, Phelps finally made something of himself — he won eight golds and as a result stands to earn an estimated $100 million in career endorsements. Phelps' current endorsements include Speedo, Visa, Kellog's, AT&T, Hilton, Rosetta Stone, Omega watches, Power Bar and PureSport beverages. The amounts that they are paying Phelps are unknown, but they are almost surely seeing a great return on their investments, considering Phelps's rise to stardom.
By winning eight golds, he garnered a $1-million bonus from Speedo. Phelps' deal with Speedo ends in 2009, when he might jump to one of the apparel superpowers like Nike to begin his own swimwear line. This marketing strategy is very feasible, as Mark Spitz demonstrated in 1972. Spitz had worn Speedo in Munich when he won a then-record seven gold medals. He retired from swimming the next year but nevertheless became the front man for a brand new swimwear line, Arena, which was branched under the Adidas family. By the world championships in 1975, two-thirds of swimmers were wearing Arena. Some say that Phelps could be worth up to $50 million to Nike.
So what exactly are Phelps' medals worth? The actual value of the ore to make a medal is a bit over $200. That's a start. The United States Olympic Committee gave out 25 grand bonuses to athletes for each gold medal they won, which was actually chump change compared to Singapore and the Philippines, which doled out hundreds of thousands of dollars for each gold. It's hard to estimate how much a Phelps medal would auction for, but $100,000 would be a conservative guess.
Phelps' daily expenditures are much greater than the average person's. When he trains, Phelps must inhale food faster than he swims the 200 free. He spends well over a Benjamin on meals per day. His typical breakfast runs about $50 at an IHOP.
When he doesn't train, he makes it rain. I don't know much about the guy, but I know two of his vices are clubbing and gambling. Both are costly. Of course, those expenses are on his own time, and as Bobbie Barrett says, "Being a big shot means you don't have to pay." He's been paid $100,000 to swim at a party and makes upwards of $50,000 for speaking engagements.
Since the completion of the Olympics, Phelps has remained prominent in the news. He appeared on just about every late-night talk show and started the Michael Phelps Foundation, a charity to promote water safety and youth swimming. For hosting SNL, Phelps pulled down $5,000. He made a cameo on Entourage and that Guitar Hero commercial he filmed with Kobe, A-Rod and Tony Hawk will probably be aired plenty. It's even been rumored that there will be a Michael Phelps reality show.
Will Phelps reach LeBron or Tiger territory? I doubt it. He'll never get to be known by one name, since there already is a Michael. But he hasn't done so badly for himself, considering he's only 23. Phelps plans on swimming in London in 2012. Financially, he doesn't need it, and I'm already tired of him. I don't think we need four more years of the same.
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Jeremy Greenhouse is a sophomore who has not yet declared a major. He can be reached at Jeremy.Greenhouse@tufts.edu.
