Despite having sports in its name, Columbia Sportswear Company (NASDAQ: COLM) has shied away from large endorsement deals with pro athletes.
Instead, the outdoor clothing brand has gone after a handful of deals with athletes in sports like fishing, skiing, trail running and golf. The company also has a deal with country music superstar Luke Combs.
The company has landed one of its biggest stars yet with a sponsorship deal with NASCAR star Bubba Wallace.
What to Know: Columbia Sportswear announced a multiyear sponsorship deal with Bubba Wallace earlier this month.
The deal makes Wallace an ambassador for the Columbia brand. Columbia will have its logo on Wallace’s car, including as the primary sponsor for several races.
The upcoming race at Dover and one to two unannounced races will give Columbia get prominent space on the car as the main sponsor.
The deal is a “perfect fit for my lifestyle away from the track,” Wallace said in a statement, adding that he loves “spending time outdoors — boating, golfing, hiking, photography.”
Why It’s Important: Perhaps thanks to his activist efforts, Wallace has become one of the best-known NASCAR drivers in the sport today.
Wallace, a six-time NASCAR series winner, pushed the sport to ban the Confederate flag and was part of a hate crime investigation after a noose was discovered at Talladega Superspeedway.
Wallace, who once struggled to find sponsorships for his car and the Richard Petty Motorsports racing team, is now seeing deals pour in.
Wallace has signed deals with Beats by Dre, Square Inc (NYSE: SQ)-owned Cash App and DoorDash.
Wallace has 477,000 followers on Twitter and 480,000 followers on Instagram.
Both those figures outpace the 130,000 and 431,000 followers, respectively, that Columbia Sportswear has on the platforms.
Last week’s Daytona NASCAR race in Florida on NBC saw 3.26 million average viewers.
Columbia's Performance: Columbia Sportswear turned in a disappointing second quarter due to the impact COVID-19 has had on its physical store presence.
The company saw overall sales decline 40% to $316.6 million. E-commerce sales were the bright spot in the quarter, with 72% growth. The company said consumer interest in the outdoors has surged and could be a positive factor going forward.
What’s Next: Wallace will race his No. 43 Chevrolet Camaro at the Monster Mile — Dover International Speedway — Aug. 22 and 23, featuring prominent logos for Columbia Sportswear.
This will be a good test to see how many people tune in to the race and see Columbia’s prominent logo.
Columbia shares are down 19% in 2020, trading at around $80. Shares started the year in the triple digits.
The company temporarily suspended its dividend and withdrew guidance due to the pandemic.
Many physical Columbia stores have reopened, and all eyes are now on the third quarter, when some stability in revenue and earnings will be expected.
Bubba Wallace. Photo courtesy of Columbia Sportswear
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