Compromise Your Fanbase's Trust At Your Own Peril

What is the business-related and PR fallout when the moral pillar of a certain company, and primary symbol of trust amongst its customers, is weakened to the point of disintegration? What are the far-reaching consequences of an outcome so undesirable? For all intents and purposes, the National Basketball Association is about to find out.

Long chastised by fans and media alike, the NBA’s referees are widely believed to be the most incompetent officiating outfit amongst America’s Big Three sports - namely; football, baseball, and basketball. In the referees’ defense, an NBA foul may be the most subjective call in all of sports – questions such as the placement of blocking defenders’ feet, whether the offensive player lowered the shoulder, and if a shooter’s hand was impeded in the act – are routinely difficult to answer. (This problem is exacerbated by certain players’ tendencies to milk the fouling rules.) However, since its inception the league has had to deal with these officiating intricacies, and spectators on a whole have accepted them as par for the course. That is, until disgraced former NBA referee Tim Donaghy announced this week that he, among other still-serving NBA referees, had a decided hand in determining the outcome of past NBA playoff games, all in the name of advertising, and worse, alleged gambling, dollars.

To paint the encapsulating picture of the gross problem the NBA has had fall into its lap, one need go no further than the case of former baseball player and manager, Pete Rose. The all-time leader in MLB hits, Pete Rose was forever banned from the sport in the 1980’s upon discovery of his betting on baseball games in which he managed (though he claims he always bet ON his own team). Then-MLB commissioner Fay Vincent, in punishing Mr. Rose, looked to deliver a clear message – sports, in their essence, can only exist as a form of mass entertainment and a lucrative business venture if the ultimate sport/fan agreement is upheld – that being, that the game spectators are enjoying is legitimately competitive. Once that agreement is compromised, the whole dynamic dissolves, and as spectators we’re essentially watching sports as grandiose theater.

This week the NBA has been thrust into the above precarious position, and the timing couldn’t have been worse (or in Mr. Donaghy’s attorneys’ cases, any more calculated). The sport was in the midst of an NBA finals championship series which featured its two most storied franchises, the Boston Celtics and Los Angeles Lakers, meeting on the sport’s ultimate stage for the first time since the 1980’s. It was a PR dream, and one on which the NBA’s marketers were looking to cash in. Instead, the entire series has been overshadowed by the implications of Mr. Donaghy, who, it must be mentioned, is facing significant jail time due to previous admissions of inside gambling while officiating NBA games. But, while easily brushed off as a felon’s attempts to lesser their prison sentence, this whole “crooked refs” affair potentially represents a PR nightmare for the NBA. This week AdAge published a 1,000-recipient survey which revealed that a whopping 37% of respondents - over one-third – believe that the NBA “somewhat or very likely” alters the outcome of its games. Whether Mr. Donaghy is the lone voice in muddying the NBA’s legitimacy claims is clearly not the issue, as the sport’s fans seem to be significantly wary of referees’ authority and intentions.

Current NBA commissioner David Stern is as savvy and sharp as anyone in the business, and he’d be the first to acknowledge that in this refereeing controversy he has a major issue on his hands. As a former lawyer, he knows his way around policies and practices, as well as presenting his case to those he needs to convince. But riding on as slippery a slope as losing one’s fans’ and customers’ trust and moral buy-in to one’s product cannot leave Mr. Stern feeling comfortable or secure in his position in any way. The NBA, in regards to the age-old and vital fan/sport competitiveness agreement, is in a most precarious spot, and the outcome of the Tim Donaghy affair could prove to be a tipping point in the sport’s relevance to the sports-viewing public.