MICHAEL JACKSON SIGNS UP WITH PEPSI
In acknowledging what the Guinness Book of World Records has pronounced “the biggest commercial sponsorship deal” ever struck between a corporation and a performer, Michael Jackson made a brief appearance here Tuesday to renew his partnership with Pepsi-Cola and to say, simply, “Thank you.”
As reported in The Times on Monday, the pact is worth $50 million, with an initial up-front payment to the singer of between $10 million and $15 million. Neither Jackson’s entourage nor sources within the Pepsi camp would specify the exact dollar amount.
With advertising underwriting, tax breaks for Jackson and promotional tie-ins with a possible international concert tour, the value of the deal will come to more than $50 million, according to a close Jackson adviser.
The long-term agreement between the soft-drink company and the singer calls for Jackson to help create and appear in worldwide Pepsi ads, and for Pepsi to sponsor Jackson’s next album and any accompanying concert tour.
In 1984, in an agreement that reportedly earned Jackson $6 million, Pepsi sponsored the entertainer’s hugely successful Victory Tour, and the singer appeared, along with his five brothers, in two highly publicized and award-winning TV commercials on behalf of Pepsi. The lucrative deal resulted in “a whole ‘new generation’ image for Pepsi” and “skyrocketing” sales, said Pepsi-Cola USA President Roger Enrico.
Formal announcement of the new agreement was made by Enrico and Frank Dileo, Jackson’s personal manager, at a packed press conference at the Red Parrot nightclub on Manhattan’s Upper West Side. The 27-year-old Jackson, wearing his signature sunglasses and military uniform, appeared with the two men for about five minutes, but declined to take questions from the press.
“He’s very shy,” Enrico said after Jackson departed. “He’s most comfortable when he’s in control of the situation, and this sort of situation is out of his control.”
Details of the new agreement were sketchy as outlined for the press by Enrico and Dileo Tuesday. However, a Pepsi source, who asked not to be identified, estimated that direct revenues to Jackson “should be in the neighborhood of $10 million.” Total cost to Pepsi, including advertising and production costs, will total as much as $50 million, Pepsi sources said. (Sources within the Jackson camp told The Times last week that the direct payment to Jackson would actually be more than $15 million.)
The recently completed deal covers a three-year period, starting with the scheduled release of Jackson’s new album next fall, according to the Pepsi source. Other informed sources speculated Tuesday on the possibility of a Jackson concert tour in 1987.
Enrico and Dileo would neither confirm nor deny reports that the deal also called for Jackson to receive his share of the agreement in advance.
They did say that Jackson plans to appear in three TV commercials for Pepsi in 1987, including one in Spanish. They said he also will contribute two pieces of original music to Pepsi’s 1987 TV ad campaign, and in 1988 he will serve as “creative consultant” on Pepsi’s TV advertising, and perhaps make his directorial debut with a commercial.
In a brief, separate interview Tuesday, Enrico called the costs of the new agreement “outrageous,” but said that they were “necessitated by the competition to corner this huge (soft-drink) market.” Referring to Jackson, he added, “And I think he’s worth it.”