This is L.A. Gears 1990 sneaker,
the Billie Jean, the centerpiece of Michael Jackson's
landmark 20 million dollar endorsement deal with the brand billed as the largest
and priciest corporate endorsement deal in showbiz history.
When L.A. gear signed up the King of Pop.
They had high hopes that he'd be able
to sprinkle their sneakers with his commercial magic
set to become a major competitor for Nike's Air Jordan,
which saw unprecedented sales in the 1980s and even to this day,
remains a top selling subbrand for Nike L.A. Gear marketed heavily and poured
millions into Jackson's range to guarantee Thriller esque successes.
So why have you never heard of them?
But first, let's go back way back to 1978, to be exact, when L.A. Gear founder
Robert Greenberg first moved to Los Angeles from his native Boston,
Greenberg began distributing skates during the roller disco craze.
But by the early 1980s, he saw more promise,
focusing on athletic shoes, which led to the birth of the L.A. Gerbrand.
In 1983, L.A. Gear rode a tsunami wave of success on the back of the 1980s
fitness boom, and within three short years, the company went public,
incorporating bright colors and rhinestones.
L.A. Gear attracted teenagers with advertising that evoked a relaxed
California lifestyle full of surfing and Wiltern Bodies
L.A. gear.
Sales skyrocketed from just 10 million dollars in 1985 to over 617.
Seventeen million by 1989.
L.A. Gear became the third largest
athletics shoe manufacturer on the market, only behind rivals Nike and Reebok.
But in the fickle world of fashion, footwear profits were often unpredictable,
and many investors fear the fitness bubble was about to pop.
As a result, the top three became ruthlessly
competitive, doing whatever it took to gain market share in this burgeoning
five billion dollar industry, sneaker companies became experts in how
to pull consumers into stores with big league marketing tactics previously
associated with auto makers and soft drink companies.
At the time, Tom Clark, vice president and director of marketing
at Nike, said marketing is changing the face of our business today.
Shoe companies are scrambling to assemble
stables of stars from sports and show business for their marketing campaigns.
Nike, Reebok and L.A. gear turned athletic
shoe sales into a marketing driven enterprise ala Coke and Pepsi.
So when L.A. gear sales started slipping
in early 1989, it wouldn't be much of a surprise
that they took inspiration from Pepsi's marketing handbook and started pursuing
Michael Jackson for a similar endorsement deal.
You can have a great commercial,
but your recognition factor is far higher with a celebrity, said the then executive
vice president for the company, Sandy Samant.
As the story goes, in early 1989,
Michael Jackson's attorney, John Branca, called Jay Coleman one of the industry's
top corporate sponsorship brokers, saying that Michael was thinking
of wearing sneakers instead of his black loafers when he was filming new music
videos for his upcoming Greatest Hits album.
The switch to sneakers would have been a pretty radical image change for Jackson.
So Jay told Brunk not to go anywhere
until he had a chance to talk to Elgar's chairman, who was a good friend of his.
With Jackson suddenly available, Eligio sprung into action by sending
representatives to meet with Jackson while he was recording new music.
L.A. Gear were apparently desperate to get
involved with some of Michael's stature, no matter what the cost.
While financial agreements were being made, Michael Jackson requested 20 million
for a two year contract, apparently because he would surpass
Michael Jordan's seven year, 18 million deal with Nike.
This amounted to one fifth of Elgar's annual advertising budget at the time.
But even so, they accepted it.
As part of the deal, Eleggua agreed to air
portions of Jackson's music and video clips in their TV commercials.
Jackson was then required to wear like
your shoes in a television commercial and several print ads,
as well as in upcoming music videos, including new singles to be released as
part of his Greatest Hits album, scheduled for spring 1990.
Alan HealthOne, a top celebrity representative, said,
quote, It would be a real stretch to picture Michael Jackson doing
the moonwalk in a pair of L.A. gear shoes, although wearing the product at all was
a major concession for Jackson, who had never touched the products he endorsed.
Although Jackson sung about Pepsi for several years, none of the commercials
ever showed him holding or drinking the beverage.
It began with a rocky start
when in September 1989, the new partnership was announced
at a glitzy press conference at the Hollywood Palladium.
The executive vice president for the company introduced Michael Jackson
and proceeded to give him L.A. gear items, including their best selling sneaker,
in order to have him photographed by the press holding the product.
This angered Jackson, who covered the shoe under a jacket
and then left the items on the side before official photographs were taken.
In the following months,
Michael Jackson took part in various photo shoots, which were featured in print
advertisements particularly targeted at Jackson's young fan base.
Jackson's appeal for children led to L.A.
gear agreeing to launch in market heavily his signature jeans sneakers
in preparation for the back to school selling period.
In August 1990, Michael Jackson appeared in his first L.A. gear TV commercial,
filmed in a tightly secured area in downtown Los Angeles.
The commercial cost 700000 dollars to produce.
The 30 second clip featured Jackson's
trademark dancing and just one Close-Up of Jackson's face as he transformed
the dark alley into an electrical charge seen in the highly stylized spot.
Jackson didn't sing or speak, nor did the commercial have any typical
Jackson music, with L.A. gear sales still on the decline.
Jackson was to be a much needed boost
for the company in the run up to the Christmas sales period.
The trend in the athletic shoe market is toward a flashier, more upbeat look,
said Dick Silverman, then editor of trade publication Footwear News.
Quote, I don't see any reason why these shoes shouldn't be extremely successful.
However, when the MJ line was launched
into stores in September 1990, retailers immediately reported dismal sales.
Some department stores struggled to sell
even a few pairs and were quickly discounted as a way to shift stock.
Parents complained about the style,
refusing to buy the impractical fashion oriented sneakers.
Many concerned that the studied and buckle
looking design would make their kids look like junior Hells Angels in them.
But apart from pure aesthetics,
the lack of sales could be attributed to Michael Jackson's relatively low profile.
During this period, L.A. Gear hopes Jackson would have
released his planned greatest hits and several new music videos.
And time for the introduction of the shoe line.
But Jackson reportedly was way behind
on both music projects, and the whole idea was later scrapped
in order for the artist to release a whole new body of work dangerous.
The following year, this turn of events led to a devastating
return for L.A. gear, provoking them to pursue legal action against the artist.
Two years later, in a 46 million dollar
lawsuit, the company alleged fraud and breach of contract.
The suit contended that its advertising for the shoes suffered because Jackson
missed deadlines to deliver footage that could have been used in shoe
commercials and had not released the album that was involved in the contract.
According to the suit at the time, when Jackson said he was producing
the first video, he actually was planning a trip to Africa.
Michael Jackson filed a 44 million dollar
countersuit against Ligeia, although the specific acts of fraud
and breach of contract Jackson was alleging were not disclosed to the press.
While both cases were settled out
of court, the damage to last year's bottom line persisted.
Throughout the 1990s, Elijah's popularity kept waiting.
A lucrative deal with Wal-Mart failed as
sales for Ligeia shoes continued to decline over the years,
the company was so desperate to sell the remaining inventory,
alligator shoes began showing up at flea markets swap meets and supermarkets,
and the company filed for Chapter 11 bankruptcy in 1998.