Commentary

Spinning Olympic gold

Edited by Sophie Vorrath

Published 3:25 PM, 18 Aug 2008

There's nothing like a major global sporting event – like, say, the Summer Olympics – to reinvigorate the world of mass marketing.

While marketing was "a dirty word in China less than a generation ago", say Kevin Allison, Geoff Dyer and Patti Waldmeir in the Financial Times, "Beijing is using the Olympics to market itself as a superpower", as well as to shift its corporate image from "sweatshop to the world" to that of a high-quality, high-valued-added and high-technology hub.

"Never before has the market potential of the host country on its own been viewed as possibly worth the significant investment," says Julius Roberge, strategy director for Siegel+Gale New York, talking to MarketWatch.

The challenge, he adds, "is Herculean". And while success would send a strong new message, any missteps mean China "will not soon have such visibility to transform a lagging image."
Companies, not to mention countries, align themselves with the Olympics in the hope of borrowing equity or transferring goodwill from the Games to their own brands, says Siegel+Gale group director Larry Vincent, also quoted in MarketWatch.

Back in the days of the Los Angeles Games, achieving this goal was "a slam dunk", he says. But now, with increasing competition and the changing times, it's getting harder to do.

In total, more than 60 companies are official sponsors or partners of the games, while "many more are trading off the Olympic spirit without paying for the sponsorship", say Allison, Dyer and Waldmeir.

It can still serve as "an effective place to reposition a brand," says Vincent, and it can work as "the coming out event for large international companies who wish to elevate brand awareness on a global stage." But, he adds, it requires the a lot of seeding work beforehand "and very aggressive follow-up work" at the other end.

Whether or not Chinese companies are ready to exploit this opportunity, however, is another matter. Many market experts say they aren't, and point to Heng Yuan Xiang as a case in point, say Allison, Dyer and Waldmeir. The wool producer was forced to withdraw a prominent TV ad trumpeting its Olympics association after the campaign was widely ridiculed for displaying some of the worst traits of Chinese advertising; such as the use of loud, excessive repetition and primitive production values.

Even computer outfit Lenovo – the only Chinese company gracing the elite group of 12 official Olympics sponsors, alongside Coca-Cola, McDonald's and Johnson & Johnson – hasn't exactly won gold these Games.

The company-designed Olympic torch soon became a symbol of Chinese repression in Tibet, attracting protests as it made its way around the world, say Allison, Dyer and Waldmeir. Not exactly a dream start to a years-long and expensive campaign that had hoped to establish the company as a genuinely global brand – something its $US1.3 billion purchase of IBM's personal computer group in 2005 had so far failed to do.

For those advertisers and brands outside of China, however, the Beijing Games have been a marketing tour de force, say David Kiley and Burt Helm in BusinessWeek.

In the US, for example, NBC Universal says it attracted 168 million total viewers over the first five days of the Games, nearly 15 million more than for the same time during Games in Athens, four years ago.

Viewership and interest has also been better than expected, enabling NBC to sell an additional $US10 million in ads since the start of the Games, on top of the more than $US1 billion in ad revenues it made before they began.

As for the brands, there has been a mix of more than 100 new and old, say Kiley and Helm. Adidas, Nike, and Visa are among the heavy hitters, while both Presidential candidates have spent a combined $US10 million-plus on Olympic campaigns.

"We expect Adidas, Coca-Cola, and McDonald's will still do well," says Vincent. "Part of that is the legacy. In Adidas' case, it's the innovative way they've gone to market."

A golden opportunity?, Kevin Allison, Geoff Dyer & Patti Waldmeir, Financial Times

Branding at the Olympics, MarketWatch

Advertisers are winning Olympic gold, David Kiley & Burt Helm, BusinessWeek



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