The Olympics officially kicked off last Friday, and the entire world is tuned in to see the highest-caliber athletes compete to win the most coveted prize in international sports: Olympic Gold. However, this just barely scrapes the surface of what is really going on at the Olympics. The century-old sports competition is also one of the world’s most high profile sport’s sponsorship opportunities; for a select number of brands, the Olympics offers the chance to be seen on a global stage, and reap the benefits of being associated with the healthy and glamorous images of star athletes. However, do the benefits justify the $100 million price tag for top sponsors?
Sponsorship is crucial to the success of the Olympics. The International Olympic Committee (IOC) created the gold medal of Olympic sponsorship in 1985: The Olympic Partner (TOP) Program that gives exclusive worldwide marketing rights to a select number of sponsors, and makes for 40% of total Olympic revenues. Aside from brand association, companies get exclusivity during the event, boosting sales and giving brands the possibility to demonstrate the quality of their products. Examples include Worldwide IT Partner Atos’s successful delivery of the technology infrastructure system during the Games, and Omega’s role as Official Timekeeper.
However, the world is watching if something goes amiss. Visa, a member of the TOP program and the only brand of card payment accepted at all Olympics venues, was reminded of this pressure when on Monday the credit card system at Wembley stadium went down and the only option fans had was to pay in cash. Thousands were forced to leave to buy food and drink, losing money for vendors and spurring indignation for the credit card brand. McDonald’s has also come under fire after there was an effective embargo placed on the sale of non-McDonald’s french fries in the Olympic park.
There have also been ethical questions raised over the IOC’s decision to accept MacDonald’s and Coca-Cola as official food and drink sponsors. Both have a long term association with the Games with Coca-Cola’s involvement going back to 1928 and McDonald’s to 1976. And both have sparked controversy due to the nature of many of their products. There are a number of people livid that two brands whose products are recognized as contributing to health problems such as obesity and diabetes are sponsors of an event that embodies health, fitness and peak physical performance.
So what is the value of being an Olympics sponsor? The exact numbers regarding return on investment of the big sponsors is hard to calculate. However, a survey from the investigation group Research Now found some interesting information about the public perception of sponsors. According to a report published in Forbes of 7,200 consumers in Australia, Canada, France, Germany, the UK and the US, the impact of Olympic sponsors on consumers is unclear. Findings include:
-60% of American and 67% of French respondents believe Nike is a sponsor. Adidas is.
-62% of people said they would not buy from an Olympic sponsor.
-49% of French respondents indicated that Evian is a sponsor.
-21% of British respondents believe that Red Bull is a sponsor.
Do you think companies such as McDonald’s and Coca-Cola should sponsor the Olympics? Is the investment even worth it for these companies? Tell us what you think!