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Sponsoring Sochi Winter Olympics athletes leverages brand value

Posted by Chad O'Connor  December 11, 2013 11:00 AM

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In the world of advertising and sports marketing we hold these truths to be self-evident:
- Content is king.
- Exclusive sports content is the most valuable content.
- The Olympic Games are the most valuable sports content of all.

As thousands of athletes and billions of eyeballs converge on Russia for the 22nd Winter Olympic Games, they make the Olympics the most valuable sporting event in the World. Even the backsplash from a few dirty needles, hyper-frozen bobsled runners, and random leg clubbings are no match for the powerful forces that coalesce every two years to focus attention for 17 straight evenings.

Obviously without compelling backstories such as Lindsey Vonn’s comeback and Shaun White’s remarkable acrobatics, there is nothing to watch – or sell. And selling is ultimately what has powered the Olympic Games since Peter Ueberroth and Los Angeles demonstrated that the Five Rings can be a profit center.

Follow the money:

  • The IOC sells US broadcast rights for Sochi to NBC for $775 Million.

  • NBC in turn sells advertising to liquidate that investment. After taking a $200MM write off on Vancouver thanks to the recession, NBC is now poised to sell out all Sochi inventory.

  • The brands that purchase these advertisements at an “Olympic premium” have to sell a lot of products or a see a LOT of brand “lift” to justify and/or liquidate their investment.

The good news for those at the top of the Olympic food chain is that the system generally works. The IOC is extraordinarily well-funded and NBC has successfully built and maintained its brand as the Olympic network in a media environment hardly conducive to the concept of “network” television. But what of the sponsors – who spent millions of dollars in rights fees to the US Olympic Committee and even more millions to NBC for the ads to promote that affiliation?

Ironically and not-completely suprisingly, it is this last link in the Olympic chain which offers the most risk for failure. In the interest of brevity (and my disinterest in litigation), I won’t list out the larger number of sponsors who have wasted shareholders’ money with ill-defined or non-existent consumer activation strategies and unfocused brand messaging. One does not have to look very deep into the Business section to find a CFO and CEO who have had some smoke blown somewhere about how their marketing team is turning $40 million worth of incremental spend into $80 million worth of unsubstantiated “value.”

For every John Hancock and Visa who built and executed legendary marketing strategies around their Olympic sponsorships, there are numerous wannabees who get blinded by the opportunity and overwhelmed by the magnitude of the challenge to compete at the highest level of marketing. Though if a brand does a poor job marketing and selling their sponsorship, there will always be another firm coming along to buy out their category of rights (another reason to be at the top of the food chain than the bottom).

However there is also another category of sponsor which has reviewed the Olympic ecosystem and chosen a more efficient and effective way to leverage their marketing budget in the pursuit of a slice of the Games’ popularity. These sponsors are the ones who put their money to use in support of the athletes themselves. One of the most effective and creative programs of this variety by a non-Olympic sponsor is Putnam Investments.

Putnam is a sponsor of the US Ski Team & US Snowboarding, as well as Olympic Gold medalist and World Champion skier, Ted Ligety, and has activated these partnerships flawlessly via highly focused sales and branding programs. Putnam understood perfectly that while skiing & snowboarding may be niche sports that effectively deliver the high-end demographic they value on an ongoing basis, once every four years they become the focal point of the nation. So Putnam set out to develop a strategy that would capture and convert that broader audience.

Putnam started early on to build a campaign that would be consistent with their position as a team and athlete sponsor – but at the same time leverage and take advantage of the very same “Olympic” qualities and characteristics for which official sponsors were paying tens of millions of dollars. Putnam’s Head of Global Marketing, Mark McKenna, noted research which demonstrated clearly that brands which have any affiliation with the Olympics are perceived as having category leadership, are considered “World Class,” and exhibit the highest level of trustworthiness - all of which aligned with his efforts to shape and extend the Putnam brand worldwide.

Putnam’s President and CEO, Robert L. Reynolds, directly references his firm’s commitments to these same ideals when discussing Putnam’s sports marketing strategy, noting that the US Ski & Snowboarding Teams and Ted Ligety “represent values that transcend their sport: tireless dedication to excellence, unyielding commitment to preparation and ongoing improvement, and a relentless drive to succeed at the highest level — competing against the best in the world.” These are exactly the kind of brand and strategic alignments which underscore the most effective and successful sports marketing programs.

The creative executions the Putnam team have developed are blunt and effective; the unspoken connection to the Games is powerful. Putnam is going to be driving that point home consistently and effectively with a multi-platform campaign which started recently on NBC, the Olympic network itself, and will continue being transmitted to consumers relentlessly via print, digital and TV. Importantly, all ads are carefully structured to fall within the very strict guidelines that govern Olympic-related marketing.

The ability of creative brands such as Putnam to both effectively support the Olympic ideal via their partnerships with the very teams and athletes that comprise the Games, and at the same time develop marketing and brand strategies to leverage the intersection of those partnerships with the Five Rings is what truly defines category leadership and portends even greater future successes.

John Ivey is Managing Partner of AMM, a marketing strategy firm based in Boston which specializes in sports & entertainment marketing.

This blog is not written or edited by Boston.com or the Boston Globe.
The author is solely responsible for the content.

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