LeBron Cuts Ties With McDonald's to Promote Small Pizza Company

LeBron James Visits Shanghai

LeBron James of the Cleveland Cavaliers takes part in a basketball training session.

Photographer: ChinaFotoPress via Getty Images

LeBron James is breaking up with McDonald’s Corp.

The basketball star is ditching the fast-food giant in favor of a role as “brand ambassador” at upstart chain Blaze Pizza -- part of a growing trend of elite athletes and entertainers who don’t want to be just pitchmen any more.

Blaze, one of several fast-growing chains vying to be the so-called Chipotle of pizza, expects to finish 2015 with about 110 restaurants and just over $100 million in revenue. James, a four-time National Basketball Association most valuable player, has been an investor in Blaze since 2012, and now has the opportunity to use his immense star power to put a chain that most Americans have never heard of squarely on the map.

There was a time when a star as big as James would have stuck with large, deep-pocketed companies like Nike Inc., PepsiCo Inc. and McDonald’s, and plenty still do. But by casting his lot with Blaze, James can also boost the value of the equity investment. And because he has a financial stake, he may be an even more effective spokesman, said Allen Adamson, North American chairman of the branding firm Landor Associates.

“He’s just not selling out to get a paycheck,” he said. “Consumers are skeptical unless they believe that the celebrity actually uses the product and is invested in the brand.”

Prominent athletes can use their star power, particularly on social media, to shape the companies they back, said David Carter, executive director of the Marshall Sports Business Institute at the University of Southern California. And they’re more willing to pass up endorsement cash to gamble on a long-term payoff, he said.

Social-Media ‘Megaphone’

“A guy like LeBron can move the needle with a company like that,” Carter said. “He’s a powerful brand ambassador and he has the megaphone of social media. That’s a dramatic shift.”

As the media landscape tilts toward social media, authenticity has become increasingly important for celebrities when they endorse brands. Pictures on Twitter of an actress wearing a dress will lead people to ask about the designer. But it’s also easier to tell when someone isn’t using a product. James got into hot water earlier this year when the basketball star suggested he didn’t eat McDonald’s regularly, and consumers see through that type of endorsement now, Adamson said. Customers are more likely to believe that James actually likes Blaze Pizza because he has a financial stake in the company, he said.

James, 30, has at least a 10 percent stake in Blaze, according to a person familiar with the situation, who asked not to be named because the information isn’t public. He’s also a partner in a franchise group that holds the rights to develop Blaze restaurants in Chicago and South Florida, according to Jim Mizes, the chief operating officer of the pizza chain.

“LeBron believes strongly in the company and where it is going and was ready to double down,” Maverick Carter, James’s business partner, said in an e-mail. “He wanted to invest the value of his endorsement into a company he owned.”

Assembly Line

Blaze was founded in 2011 by Rick and Elise Wetzel, who previously founded Wetzel’s Pretzels. Maria Shriver and Red Sox Chairman Tom Werner were also early investors. The chain employs an assembly-line system, similar to Chipotle’s, that lets customers customize 11-inch pizzas.

McDonald’s said in a statement that the company and James “mutually decided to end our relationship.” The company had worked with James since 2010.

“We wish him the best in his future endeavors,” said Lisa McComb, a spokeswoman for the burger chain.

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