Ole Miss revs up rewards program Labor & Agents: George's sponsors stay Pepsi takes over as NBA sponsor Beacons deliver the message World Congress: Setting the scene 5 Questions: VenueNext CEO Plugged In: Rishi Nigam, Americrown The Lefton Report: NFL and daily fantasy What marketers can learn from baseball Bright House joins Orlando City roster
SBJ/August 13-19, 2012/OlympicsPrint All
The Olympics, it turns out, don’t have to be a nation-building exercise. They don’t have to be used as a megaphone to announce a new superpower like China’s arrival, or a vehicle to attract investment from around the world for an emerging nation like Russia or Brazil.
By delivering venues on time and avoiding major issues, London 2012 showed that the Olympics can be about Usain Bolt or Michael Phelps, Jessica Ennis or Allyson Felix. And in doing so, they set a high bar for organizers in Russia and Brazil, who are already facing questions about hotels, security and flexibility in working with the international sports business community.
“London put sport back at the forefront of the Olympic Games,” said Terrence Burns, president of Atlanta-based Helios Partners, a strategic sports marketing agency. “This is not about China. This is not about Russia. It was about sport, and it just happened to take place on the fantastic palate of London. There was a fear the Olympics had strayed from that.”
Former Visa executive Michael Lynch said that returning the focus to sport made it the “best Games of our lifetime.”
Jeff Diskin, Hilton Worldwide senior vice president of global customer marketing, put it this way: “China was such an over-the-top event, you had to wonder how any city could follow. London has shown its best colors. It has been a remarkable atmosphere. I always have high expectations for the Olympics, but everything about [London] exceeded my expectations. It has been overwhelmingly positive the feeling you see among everyone in every place. I’m happy for everyone who works in the Olympic movement.”
Britons didn’t make drawing that conclusion easy.
The four years leading up to the Games were clouded by austerity measures, dampened by three months of rain, overwhelmed by despair over traffic and doubts about London’s public transport system and, finally, obscured by news that a security contractor failed to fulfill its agreement.
But those issues and the pessimism that came along with them faded once the opening ceremony began. The quirky and distinctly British show directed by Danny Boyle won over a skeptical nation and reminded millions of viewers worldwide what the Brits had contributed to literature and pop culture.
The sporting performances that followed swept them away. Great Britain won more medals than it had since 1908, the first time it hosted an Olympics. The nation, and the world, also saw legendary, encore performances by Michael Phelps, who became the most decorated Olympian of all time, and Usain Bolt, who electrified the world with his speed and outsized personality.
All of those stories dominated the front pages because the organizers of the Games overcame many of the issues that prognosticators thought would plague them.
That’s not to say organizers didn’t err.
The London Olympic Organizing Committee
With relatively few problems concerning venues and logistics, the London Games allowed the on-field exploits of its stars to dominate the conversation.
Photo by:GETTY IMAGES (3)
Sponsors, agencies and Olympic officials won’t forget the buses that didn’t show up to transport them to the opening ceremony or the over-reliance on a GPS system that rendered BMW’s VIP cars worthless.
But those issues were outweighed by LOCOG’s nimbleness and good fortune. It included Tube passes with all of its tickets, which gave hospitality hosts an immediate plan B when buses didn’t arrive, and public transportation ran so smoothly that even Rio 2016 CEO Leo Gryner gave up on the BMWs and opted for the Tube.
“The first two days were really rough,” said Jan Katzoff, executive vice president of Radiate Group, which works with 18 Olympic sponsors. “To their credit, they helped us attack the [transport] problem and fix it. From that point on, for our clients, it’s been one of the best operations I’ve ever seen.”
Among the things organizers got right was its selection of venues. It placed sports at a host of iconic locations around the city, from Lord’s Cricket Ground to Wimbledon. Its biggest success was putting beach volleyball at Horse Guards Parade, where women in bikinis and spandex tights played late into the night on the doorstep of the prime minister’s home at No. 10 Downing St.
LOCOG also showed that it’s possible to build temporary venues like a blow-up basketball arena that don’t damage competition but do eliminate white elephants and control the skyrocketing costs of hosting an Olympics.
“For me, one of LOCOG’s achievements is the way sustainability and legacy were built into the DNA,” said IOC member Denis Oswald of Switzerland.
The city of London made for some of the most successful hospitality programs at an Olympics in years. Guests could spend a morning at Buckingham Palace, an afternoon at diving, dine at world-class restaurants like Mosimann’s and then walk through Trafalgar Square to watch beach volleyball.
Sponsors, who used the Beijing Games to penetrate the Chinese market, showed they could still get value out of an Olympic sponsorship when the Games go to a mature market. Worldwide Olympic sponsor GE did $100 million in infrastructure sales, and IOC sponsor Procter & Gamble expected a $500 million jump in sales related to the Olympics. London 2012 partner Adidas chipped away at Nike’s lead in the U.K.
“We’re really pleased with our business results,” said Marc Pritchard, P&G global brand building officer, who pointed out that the company was getting a 5 percent to 20 percent lift from Olympic displays in stores from the U.S. to Egypt to Russia. “The Olympics are working.”
“The [business-to-business] play and [business-to-government] play continues to grow in a huge way for these companies,” said Rob Prazmark, CEO of 21 Marketing, who has worked on every Olympics since 1988. “From a business perspective, these Games may be the best I’ve encountered.”
Sponsors and agency executives were quick to acknowledge that the issues they ran into in London were high-class problems compared with what the next four years might hold.
Neither Sochi nor Rio have the hotel infrastructure necessary to host the number of hospitality programs that take place at an Olympics. And questions already have emerged about both organizers’ ability to manage the 2014 and 2016 Games, respectively.
Sochi built a huge showcase in London’s Hyde Park for its sponsors and then charged spectators nearly $30 to enter. After few people visited the first week, organizers eliminated the tickets and made the venue free. But that was only after misjudging the appetite of consumers and limiting the exposure of its sponsors.
Similarly, Rio 2016 organizers arranged a news conference to mark the date it will open the Summer Games in four years. It started 30 minutes late, one of the presenters wasn’t there and only Portuguese was spoken.
Traffic and security also will be question marks in Brazil. Marketers who have already relocated to Rio spoke in London of 2 1/2-hour commutes to work and family members being held at gunpoint by masked criminals.
All of that has created a sense of unease in the Olympic business community, which last week enjoyed one of its easiest Games to date.
“No one should underestimate what a challenge this is,” said Darryl Seibel, the former U.S. Olympic Committee executive who oversaw the British Olympic Association’s communications department in London the last two years. “It’s a massive undertaking. Any city that goes into this has to do it with eyes wide open. Just how big an undertaking this has become has got to be something the IOC looks at.”
What transpires in Sochi and Rio the next four years will go a long way to determining whether the IOC will.
The London Olympics will be remembered for a host of things, most of them positive but some still to be determined. Here is a quick look at some of the lasting effects, good and bad, from the 2012 Summer Games.
The Social Games
NBC credited tweets from the opening ceremony with helping drive its record-setting initial broadcast from London. Team USA saw engagement on its Facebook page soar and collected more than 220,000 “likes” for a highlight reel of gymnast Gabby Douglas. And gold-medal-winning athletes added thousands of followers in the moments after they won.
There were negative stories, as well. Two athletes were expelled from the Games for alleged racist tweets, NBC faced backlash on Twitter when people registered tape-delay complaints using #NBCfail, and British diver Tom Daley had to deal with a cyber-bully exchange with a tweeter after failing to win a medal.
From Blight To Bliss
When London won the Games seven years ago, Stratford was a wasteland marked by buildings with broken windows and streets dotted with discarded appliances.
The Olympics gave the city a chance to clean up that area of town and showed Londoners who had always avoided it that getting there wasn’t as difficult as they had always imagined.
The Athletes Village will be converted into affordable housing, and by the end of the decade, London officials hope to have 12,000 more people living in the area.
“Stratford was a wasteland,” said Gary Pluchino, IMG’s senior vice president and head of global Olympic consulting. “To see the river there without shopping carts and tires in it is amazing.”
This was London 2012’s black eye.
The ballot system it developed for tickets crashed the first time tickets were put on sale, discouraging many Britons from applying for tickets again. Many of those who did come back were able to select seats for an event on the ticket website but then were told they weren’t available when they went to pay for them.
Ticketing — and, by extension, venues with empty seats — has been a recurring problem for Olympic organizers, and London was no different.
“The systems for the Olympic Games in general are improving from Games to Games, but there are problems always,” said Sead Dizdarevic, who heads Jet Set Sports, an Olympic ticket and hospitality agency. “As long as they have this type of system, problems will continue.”
A Dose Of Humor
Mr. Bean set the tone for one of the most humorous Games on record with his appearance in the opening ceremony. The more than 60,000 volunteers extended the laughs by mixing wry and satirical jokes into their efforts to direct traffic at Olympic Park.
USA Swimming chief marketer Matt Farrell was walking up to the London Aquatics Centre one night when someone announced on the loudspeaker that in an effort to do a better job recycling, the water from the pool was also being used to flush the toilets.
“I paused and then went, ‘Nah,’” Farrell said, adding: “Everyone puts on the smiles and tries to be friendly at the Olympics, but they really had a sense of humor.”
No White Elephants
Photo by:GETTY IMAGES
London organizers came into the Games committed to leaving no “white elephants” behind. Of its eight permanent venues, it had legacy plans for six. For example, the Copper Box, which hosted handball, was designed to become a community center after the Games.
And despite organizers’ and city officials’ struggles to find a permanent tenant for the Olympic Stadium, London set a new standard for developing facilities that have a life after the Olympics.
Lack Of Ambush
There was almost no noise about ambush marketing at these Olympics, which was refreshing to sponsors and marketing agencies.
In the U.S., the U.S. Olympic Committee spent the last two years holding a series of workshops on ambush marketing and reaching out to officials in Washington for support if an incident arose.
In the U.K., the British government passed tough laws preventing use of the five-ring logo and the words “Olympics” or “London Games.” Their efforts to make sure that shops didn’t illegally infringe on those rights, though, did result in a public backlash and concern that they became overzealous in protecting sponsors.
“The intent was to spot the major brands like Pepsi and Nike, not the local florist or the baker or the butcher who wants to celebrate the Games,” said Michael Payne, an independent consultant and the former director of the International Olympic Committee’s marketing program. “LOCOG scored a complete own goal there.”
Photo by:GETTY IMAGES
People from Spain, Germany, the Netherlands, Poland, Russia and the U.S., among other countries, could be seen across the Park and outside every venue, from Earls Court to Wimbledon. They gave the Olympics an international flavor that surpassed most previous Games, thanks largely to the easy access to London from so many countries.
“It’s so easy for people throughout Europe to get here,” said Darryl Seibel, head of communications at the British Olympic Association. “There’s a real blend of nations that you don’t get in every Olympic city.”
■ You were in China in 2008. How do these Olympics compare?
Sorrell says it’s easier for developing countries to justify the Olympics, but the U.K.’s infrastructure will benefit.
Photo by:AP IMAGES
Beijing was extremely well-organized, as London was. Beijing was more methodical and formal. London was warmer and clearly, more quirky.
The opening ceremonies [in 2008 and 2012] were equally good. In China, you couldn’t help but be impressed by the scale, the technology and the difficulty. It was much more ordered. Much more militaristic.
London was much more quirky, intellectual and full of inside jokes for people in the U.K. Having said that, Danny Boyle did a fantastic job.
■ Was it worth the estimated $14 billion cost?
SORRELL: It’s much easier for China or Brazil or Russia to justify. For fast-growing markets, one of the ways to reposition your country is through the Olympic Games, World Cup or Formula One. For a mature market like the U.K., it’s much more difficult to justify the infrastructure investment. But it accelerates the infrastructure investment. It drags forth airports, hotels and the likes.
■ What will the London Games be remembered for here in London and the U.K.?
SORRELL: There are two things the bid talked about: one was legacy for East London, which has been considerable. I know there are naysayers, but if you look at before and after, visitors are amazed by that legacy development. The question is do we continue to use it in an effective way.
The second is the impact on youth. Will it encourage young people to be healthier in the aspect of their life and encourage them in life? I thought it was interesting whilst GB was losing on [penalty kicks] to South Korea, you had unpaid athletes … Mo [Farah], Jess [Ennis] and Greg [Rutherford] all winning gold, and we had our highly paid footballers losing on [penalty kicks]. I thought that was an interesting juxtaposition.
■ There was a lot of grumbling coming into this. What has surprised you most about how the Games went?
SORRELL: This must have been the first time the media got behind something in this country. A media member told me that the turning point was when Bradley Wiggins won the Tour de France the Sunday before.
A lot of people were concerned about the opening ceremony. Part of it was relief, but more of it was genuinely being impressed by it. It didn’t have the scale of Beijing, but it did have some scale. You walked into the stadium and it was all of England’s green and pleasant land. … Everyone I spoke to said it did play well on television.
There have been the blips. There was one tragic incident there with the bus driver and cyclist.
■ How will they be remembered around the world?
SORRELL: London at its best. Not just London but Weymouth and Eton Dorney. Britain will be seen as a country that can organize something extremely well, is quirky but has a good bit of humor. … The stadium was amazing. The torch lighting was incredible — to bring a new twist to it. It will be remembered as well-organized, well-executed and something of beauty.
For example, the triathlon was very well done visually. The marathon on Sunday looked extremely good using all the tourist hot spots. Despite being a small country, it’s a country that hasn’t lost its touch.
■ A decade ago, the Olympics were under fire for corruption. Now they seem to be on a run of over-delivering for sponsors and advertisers. How would you describe their health?
SORRELL: Jacques Rogge has done an amazing job. There were concerns. There was a change in leadership. Jacques has done an incredibly good job in repositioning the Olympics. There are similar challenges for FIFA. There are similar challenges for Formula One. This is all about the professionalizing of sport. It has to be professionally run and carefully run. … It will become more and more important.
In U.S. media circles, the London Games will be known as the first truly digital Olympics. For the first time, NBC streamed every event live online, and NBC Sports Chairman Mark Lazarus believes the online effort helped drive interest around the Games and pumped up the network’s prime-time ratings.
NBC’s extensive online coverage obliterated the numbers that came out of Beijing.
At press time, the London Games were on pace to set a viewership record on broadcast TV and cable TV.
But they already obliterated digital numbers that came out of Beijing. The 102.6 million total video streams in the first week was higher than all of Beijing. The 45 million live video streams was more than three times higher than Beijing.
Visitors to NBCOlympics.com were spending 27 minutes per visit on the site, which more than doubled the time spent during the Beijing Olympics.
NBC was able to sell $60 million worth of ads around its digital offering. The network doesn’t sell digital ads on its own; instead, they are packaged with a more traditional TV buy.
It’s too early to determine how this will play out in Sochi or Rio, Lazarus said. But based on the numbers coming out of London, it seems certain that NBC Sports will continue to build its digital business around the Olympics.
“It’s an evolving technology. It’s an evolving business. It’s evolving consumer habits,” Lazarus said. “Invariably, what we do in Sochi will be different from what we’re doing here. We will evolve our coverage. I haven’t thought of how. Nothing should stay the same from Games to Games.”
NBCOlympics.com an online hit
NBC released numbers behind its extensive digital offerings through the London Games’ first week.
■ 1.117 billion page views
■ 102.6 million total videos streamed
■ 45 million live videos streamed
■ 7.6 million devices authenticated by cable, satellite and telco customers