July 16, 2012 09:49 AM
It didn’t take long for Morgan to discover that Walsh’s decision to have two sons — Joseph, 2, and Sundance, 1 — had a silver lining. The two boys opened up a whole new world of endorsement opportunities. Last week, Morgan closed the first of what he hopes will be several deals based on Walsh’s motherhood: a Pampers endorsement for Walsh to promote USA-branded diapers and wipes.
Kerri Walsh's Pampers deal is an example of the marketing of "Olympic moms."
“For years, all of these companies that have executed Olympic and ambush marketing have wanted to talk to the core demographic: the mom,” said Evan Morgenstein, who represents Torres, Beard and Evans. “Now, they don’t have to use girls to talk to moms. They have moms to talk to moms, and that’s created a significant opportunity.”
The rise of the Olympic mom ahead of the London Games is occurring because of the confluence of two factors. Older athletes increasingly are competing in the Olympics, and mothers today are as coveted a demographic for marketers as ever before.
During the last 40 years, the average age of female Olympians representing Team USA has increased by 4.5 years, from 22 at the 1968 Olympics to 26.5 at the 2008 Games. The increased age coincides with increased support from the U.S. Olympic Committee, which almost doubled direct athlete funding in the last decade, and increased endorsement opportunities for Olympians. Both factors made it more financially viable for athletes to continue to compete long after the age at which Olympians historically had retired.
The rise in age of athletes has corresponded with a rise in importance of moms as consumers. Moms have always been viewed as valuable purchase decision-makers in the home, but their importance has evolved in recent years.
“It used to be moms wouldn’t buy cars. They wouldn’t buy computers. They wouldn’t buy phones. Now that’s changed and it’s extending into sports, as well,” said Stacy DeBroff, founder and CEO of Mom Central Consulting, a Boston-area marketing firm that advises clients such as Pepsi and Procter & Gamble. “With online research and recommendations, moms say, ‘We don’t need dad to go out and buy these things. I can get you soccer gear or swimming gear. I can buy the new computer.’”
Olympic sponsors began making a concerted effort to tap into the expanded purchasing power of moms in 2008. Johnson & Johnson, a member of The Olympic Partner program, developed a “Thanks, Mom” campaign that featured 2008 Olympians Cullen Jones and Shalane Flanagan thanking their moms for helping them reach the Beijing Games.
P&G borrowed the concept and made it the centerpiece of its marketing in Vancouver and will do so again in London. That has opened the door for endorsements like Walsh’s with P&G and its Pampers brand and Evans with P&G and its Metamucil brand.
“When you have an Olympian who has a mom and is a mom, that’s the trifecta,” said Glenn Williams, a spokesman with P&G.
FRS has utilized soccer-playing mom Christine Rampone.
Jersey Mike’s, which signed a three-year deal with Rampone, plans to use her to promote the chain’s offering of fast but healthy food to soccer moms and parents on the go. FRS, which also has deals with Lance Armstrong and Tim Tebow, featured Rampone and her kids in a print and TV campaign during the 2011 World Cup that resulted in double-digit sales increases and a 12 percent increase in brand awareness. The company is developing creative around the tag line, “Being a Mom is an Endurance Sport,” and plans to feature Rampone in that campaign later this year.
“She broadened the appeal of our product by speaking to moms about it,” said Matt Kohler, FRS’ chief marketer.
Working with Olympians who are moms also opens up new public relations opportunities for brands far beyond mainstream media outlets. Over the last decade, the Web has been overrun with mommy bloggers.
Public relations firms have developed programs to reach those writers, and Olympic moms fit seamlessly into those programs. Evofem, a feminine hygiene company, took Beard, who it signed last year, to a mommy blogging conference in San Diego for a meet and greet. Beard, who runs her own blog, swimlikeamom.com, had instant credibility with the writers there. Susta, a sweetener that sponsors Torres, took a similar approach, inviting mommy bloggers to a New York press event about its product that it estimated helped the brand reach an audience of 40 million readers.
“There’s a huge layer of extra PR a brand can hit with these moms,” said Greg Goldring, director of sports talent at Platinum Rye Entertainment, which advises brands like P&G on signing athletes.
July 16, 2012 09:49 AM
U.S. swimmers, including Chloe Sutton (foreground), will be part of the campaign.
The Milk Processor Education Program signed multiyear agreements with USA Swimming, The Competitor Group’s Rock ‘n’ Roll Marathon series and Ironman Series and will use the sponsorships to support its new “Refuel: Got chocolate milk?” campaign. The campaign is designed to encourage the use of chocolate milk as a recovery beverage after strenuous exercise. Recent research by Indiana University shows that milk’s carbohydrate and protein content is more effective at rebuilding tired muscles after exercise than water.
“When you have a limited budget, the best thing you can do is pick the ideal partners you can work with because they help you stretch your dollars and give you credibility with that target audience you’re going after,” said Miranda Abney, senior marketing manager at the Milk Processor Education Program. “It’s serendipitous that we’re launching during an Olympic year when these sports are top of mind.”
In addition to signing the USA Swimming, Rock ‘n’ Roll Marathon and Ironman sponsorships, the Milk Processor Education Program signed endorsements with USA Swim Team members Nathan Adrian, Ricky Berens, Peter Vanderkaay, Chloe Sutton and Amanda Weir. Two of the swimmers are represented by Octagon, two by Arluck Promotions and one by PMG Sports.
The dairy marketing organization will highlight the swimmers in a national print ad campaign that shows the swimmers outside the pool in clothes after practice. They are each holding chocolate milk and the tag line “Our after” appears over the image. The ads are stamped with a “Refuel: Got chocolate milk?” logo and will begin appearing this week in 60 publications, including Outdoor, Men’s Health, Women’s Health and other active-lifestyle magazines.
Posters of the ads will appear in national gym chains like Gold’s and 24 Hour Fitness. The “Refuel” campaign also will include a TV spot that airs alongside NBA basketball games leading up to the Olympics. There is a stand-alone spot with Carmelo Anthony and a spot that features Anthony and swimmer Dara Torres.
The “Got milk?” organization will be a supplier of USA Swimming. Supplier category agreements for large national governing bodies are valued in the mid- to high six figures. The deal is the first agreement USA Swimming has signed since 2010.
The Competitor Group agreement makes chocolate milk the official refuel beverage for 24 Rock ‘n’ Roll Series marathons. Runners will be handed chocolate milk as they cross the finish line of the races. In addition, the “Refuel: Got chocolate milk?” campaign will be featured in the company’s four endurance magazines and its websites.
July 16, 2012 09:48 AM
Sports Illustrated will return to the Olympic sponsorship fold for the first time since 2004. The Time Inc. company signed a one-year agreement with the U.S. Olympic Committee to become an official media partner of Team USA.
Under terms of the agreement, Sports Illustrated will become a preferred advertising outlet for USOC sponsors, offering official partners a chance to advertise alongside Olympic coverage in the magazine and its tablet offering in the ramp-up to the London Games. In exchange for making Sports Illustrated an official partner, the USOC will receive advertising in the magazine to promote Team USA in the countdown to the Olympics.“Sports Illustrated is a great brand that appeals to a huge segment of America interested in Olympic sports,” said USOC chief marketer Lisa Baird. “This is a real opportunity for us to expand what we’re telling consumers about our athletes and our marketing initiatives.”
The deal differs considerably from Sports Illustrated’s previous business relationships with Olympic organizations.
Sports Illustrated was an early supporter of the International Olympic Committee’s The Olympic Partner program, signing on in 1989, but it ended that relationship in 2005.
Tim Angelillo, Sports Illustrated’s executive director of property sales and strategic marketing, said that the company wanted to take on an official role again in part because it plans to devote more resources and send more writers, reporters, editors and photographers to cover the London Games than it did for the Beijing Olympics.
The deal also gives Sports Illustrated a chance to tap into the USOC’s roster of 30 sponsors for advertising support.
“Given our support and coverage of the Olympic Games going back to 1960, the official media partnership is something we sought,” Angelillo said.
Sports Illustrated has hosted parties at every Olympic Games since the 1984 Olympic Games in Los Angeles. Tickets to the parties were some of the most sought-after during the Olympics, but Sports Illustrated scaled back its hospitality in recent years. The magazine partnered with Budweiser to throw a party during the Vancouver Games in 2010.
The deal with the USOC would allow Sports Illustrated to throw parties as an official Team USA partner for the first time in years, and that’s something the magazine is exploring, Angelillo said.
July 16, 2012 09:47 AM
As part of the agreement, which is expected to be announced soon, YouTube will promote NBCOlympics.com on its home page and direct visitors to live and highlight videos of the London Games. On NBC-Olympics.com, visitors will view highlights and live events on a video player that is provided by YouTube and features the company’s black, red and white logo.
MSN provided the video player for the 2008 and 2010 Olympics, but its deal with NBC ended after the Vancouver Games.
NBC and YouTube declined to disclose specific terms of the new agreement, but digital media sources described it as a barter agreement in which YouTube provides the video service in exchange for the benefit of being associated with the Olympics.
The deal allows NBC to save money developing the infrastructure to support the massive amount of live video streams it will provide during the 17 days of the Olympics. Plus, it will benefit from having Olympic content promoted on YouTube’s heavily trafficked home page — in addition to exposure to the video-sharing website’s audience, which trends younger.
YouTube has more than 4 billion views a day, and 30 percent of its traffic comes from the U.S. NBC hopes many of the U.S. visitors to YouTube’s site will click on Olympics videos that take them to NBCOlympics.com, which will boost total traffic during the London Games.
NBC has not announced how many hours of live video it will offer this summer, but NBC Sports Chairman Mark Lazarus said that all events will be broadcast live online or on TV. During the Beijing Games, NBC offered more than 2,200 hours of live video coverage and more than 20 simultaneous live video streams at peak times.
“We had an opportunity to look at the landscape and ask, ‘What is going to work for us?’” said Rick Cordella, vice president and general manager of NBC Sports and Olympics digital. “YouTube makes sense. They’re a young audience, heavily focused on video and they had the technology to pull off a massive amount of video consumption.”
There has been a steady decline in young viewers for NBC’s broadcasts of the Olympics in recent years. The average age of a Summer Olympics prime-time viewer has risen by nine years since the Barcelona Games, according to data from Magna Global. Cordella and others at the network see the relationship at YouTube as a way to reverse that trend.
“That’s one of the big pros,” Cordella said. “You’re hitting a younger audience consuming through these mediums. To have a conduit into them is a key for us.”
During the Beijing Games, NBCOlympics.com set records for unique visitors, page views and video streams. It averaged 6 million users daily, who spent 20 minutes on the site when they consumed video, according to NBC.
While not offering estimates, Cordella expects those numbers to be higher this summer because of NBC’s increased digital coverage plans and the fact that the London Games will take place during work hours in the U.S.
YouTube executives hope to benefit from that traffic by providing a branded video player that cements the company’s position as a leader in online video and drives traffic to its other video offerings.
“Providing fans an enhanced digital viewing experience across the thousands of hours of live Olympic games content is a significant moment for Olympic competition,” Claude Ruibal, YouTube’s global head of sports, said in a statement. “We’re excited to partner with NBC to bring the London Games to the millions of fans across a broad set of digital platforms and devices.”
Ruibal has a long history in the Olympics. He worked for ISL and launched World Championship Sports Network, which offered streaming video of Olympic sporting events. He sold a stake in WCSN to NBC in 2008, and it later was rebranded Universal Sports.
Cordella said that NBC will strike other partnerships to support its digital media offering during the Olympics. He suggested that one area where it might strike a deal is in social media.
“As you can imagine in 2012, any digital plan has to contain a social plan,” Cordella said. “You can expect us to be a player in that, as well.”
July 16, 2012 09:47 AM
Populous and Buro Happold, original architects of London Olympic Stadium, have been hired to design a retrofit of the venue to reduce seating to 60,000 with permanent clubs and concession stands.
The stadium, built with 80,000 seats, awaits a decision on who will become its primary tenant when it reopens in its post-Olympics incarnation in 2014.Olympic Park Legacy Co., the government entity in charge of the legacy project, had received 16 expressions of interest by the end of January for redeveloping the stadium. More detailed proposals are due March 23, and the group is to make a final decision by May, less than three months before the Olympics, said Andreas Christophorou, Olympic Park Legacy’s spokesman.
The legacy company had agreed to sell the stadium post-Olympics to West Hamilton United, which plays in the Football League Championship division, a tier below the English Premier League. A few legal challenges, including one filed by Tottenham Hotspur, an English Premier League club and the losing bidder to West Ham, forced Olympic Park Legacy Co. to restart the process in December to find a long-term tenant.
Christophorou refused to identify which parties had submitted expressions of interest, but soccer, rugby, cricket and concerts are potential uses post-Olympics, he said. The legacy company will own the $836 million stadium and hire an outside firm to manage the facility.
With the retrofit set for 60,000 seats, the chances are good that the stadium will also become the new national stadium for British athletics.
After the Olympics, the running track surrounding the field will remain intact for the 2017 World Athletics Championships in London. Tottenham Hotspur’s proposal would have eliminated the track, according to Tom Jones, a principal at Populous. Jones, part of the original London Olympic Stadium design team, remains busy “running feasibility studies in parallel” with Olympic Park Legacy for the proposals under consideration. “Over the next few months, it will evolve into a final design,” Jones said.
West Ham remains interested in becoming the stadium’s primary tenant, according to British newspaper reports, but the team wants a share of stadium naming rights and wants a seat at the table for redeveloping the facility, among other stipulations. The legacy company is marketing naming rights, and no deal has been announced.
Olympic Park Legacy Co. has $118 million to pay for the retrofit, which includes $55 million from the Olympics budget set aside for redevelopment. The balance comes from a local government group in exchange for a financial stake in the stadium, Christophorou said. Under the original West Ham deal, the cost was pegged at $153 million to convert the stadium after the Olympics, according to local reports. The total investment will not be known until the legacy group selects a tenant, he said.
The legacy project covers eight permanent Olympic venues, including the Olympic Village and the press and broadcast center.
Over the next 20 years, the plan is to develop five neighborhoods with 8,000 new homes within the Olympics footprint. The entire project is expected to revitalize what used to be a “wasteland, heavily polluted,” before the Olympics took root, Christophorou said.
For Populous, the sustainable aspect of redesigning London Olympic Stadium falls in line with stadiums it designed for the 2014 Winter Olympics in Sochi, Russia, and the 2014 Asian Games in Incheon, South Korea, Jones said.
The Sochi facility has the flexibility to hold 32,000 spectators for the Olympics with temporary seats added to push capacity to 45,000 for 2018 World Cup soccer. After those two events, the stadium will permanently shrink to 25,000 for club soccer.
The South Korean venue will seat 70,000 for the Asian Games before being reduced to a 30,000-seat, single-side grandstand facility to serve the local community.
July 16, 2012 09:46 AM
The USOC signed Chobani, a sports sponsorship newcomer, through the 2014 Sochi Games.
The New York-based yogurt company, which launched in 2007 and is the category leader in Greek yogurt, will be the official packaged yogurt of Team USA through the 2014 Sochi Games. Financial terms of the deal were not available. Chobani (pronounced cho-BAN-ee, meaning “shepherd”) signed on at the USOC’s sponsor level alongside 24 Hour Fitness, Hilton and Allstate, and those deals typically are worth more than $3 million a year.
Chobani plans to market its ties to Team USA throughout the build-up to the London Games in July. It plans to put the USA five-ring logo on packaging at retail, advertise across TV, print and digital mediums, and sample product from its Cho-mobile at U.S. Olympic Trial competitions.
“We were looking to align ourselves with a leader and a property that reflects similar values to our brand,” said Doron Stern, vice president of marketing at Chobani. “We wanted a brand that was passionate, authentic and inspires great hope. We found a great fit with the Olympic team.”
The deal is the second new brand the USOC has signed in the last three months. It signed DeVry University as its official education provider last November. Both DeVry and Chobani filled new categories for the USOC.
“You’re seeing, hopefully, continued momentum, and we’ll be able to exceed our sponsor goals,” said USOC chief marketer Lisa Baird. “We’re diversifying and welcoming new sponsors like Chobani and DeVry that see the value of our brand.”
Chobani was founded in upstate New York in 2007 by Hamdi Ulukaya, a 40-year-old immigrant from Turkey. It has quickly become the third-most-recognizable yogurt in the country and leads the Greek yogurt category with a 19 percent share, according to IRI InfoScan Reviews, a market research firm. Men’s Health magazine named it to its list of the “Best 125 Packaged Foods for Men,” praising it for having double the protein of most yogurts with only 140 calories.
The company rolled out its first marketing and advertising campaign last year. Its “A real Chobani love story” campaign ran on national cable and network channels and was complemented by an out-of-home and digital marketing effort. Chobani’s market share increased by 50 percent after the campaign, Stern said.
As it looked for ways to further its growth, the Chobani marketing team began discussing sponsoring the Olympics. One of the staffers had a connection with the USOC and emailed it to learn about how sponsorships worked. The company hooked up with IMG late last year, and the sports company’s Olympic division assisted Chobani in its negotiations.
“We want to continue to build separation between us and other players (in the yogurt category),” Stern said, adding that the Chobani team believed that the USOC offered an effective way to do that.
In addition to TV, digital and mobile marketing, Chobani will have its product available to Team USA members at the training center in London. Stern said he’s hoping that will result in genuine and unprompted athlete endorsements.
“If we can get some play from a PR perspective and some viral, that’d be great, but we really want to fuel the athletes,” Stern said.
In addition to working with IMG, Chobani works with Leo Burnett and OMD for media, Fleishman-Hillard for public relations and Big Spaceship for digital.
July 16, 2012 09:46 AM
NBC Universal has sold more national advertising than it did for the Beijing Olympics, topping $900 million, with more than five months to go before the London Games.
The company, which has benefited from economic stability and robust interest from Olympic sponsors, has already reset its final sales goal in advance of the Summer Games. The early success is significant for NBC, which lost more than $200 million on the 2010 Vancouver Games and faced questions about whether or not it overpaid the International Olympic Committee for the rights to the 2010 and 2012 Games. NBC paid $820 million for the 2010 Olympics and will pay $1.18 billion for the 2012 London Olympics.“The prior two Olympics we were facing headwinds or tailwinds from the recession,” said Seth Winter, executive vice president, NBC Sports Group Sales and Marketing. “We are exceptionally far ahead of any pace I can recall before. The original goal that we had for London is a goal we’ve exceeded substantially.”
Winter said NBC has surpassed its national sales total for Beijing, which was reportedly $850 million, but declined to discuss the average costs of advertising buys or the network’s ratings guarantee. Sources said the total sales have surpassed $900 million.
The Beijing Games averaged a 16.2 Nielsen rating and 27.7 million viewers over 17 prime-time broadcasts. Ad buyers expect the London Games to deliver an equally sizable audience, but they expect it to be spread across more platforms since NBC will be offering live digital streams of events and won’t have a favorable time zone that allows swimming events to be aired live in prime time.
“Like Beijing, London is an appealing host for the Olympics,” said Sam Sussman, senior vice president and director at Starcom Worldwide. “It presents a little more challenges from a time-zone standpoint. Obviously, NBC leadership is taking a different approach in terms of making the Olympics available live, which is a plus given the explosion of the role of digital and social [media] in the Olympics. It will have an impact. The hope is people will consume more of it. But people will be consuming it differently.”
The London Games run July 27 through Aug. 12, and NBC plans to offer 275 hours of Olympic programming daily. Winter said that NBC is almost done with what it calls “sponsorship sales” to USOC and IOC partners and will move to the scatter market soon.
“They’re not going to sell out of inventory because there are so many hours, especially when you add the digital and live streaming, but they’re going to hold their line with price for good reason,” said Jeremy Carey, U.S. director of Optimum Sports. “There’s a lot of demand out there. There’s not a ton of original programming in the summer in the marketplace, and they’re in pretty good shape.”
For the first time, NBC is not selling digital advertising as a stand-alone buy for the Olympics. Instead, it is packaging its TV and digital media buys together, requiring companies to buy a certain amount of TV advertising to get digital inventory.
“Those advertisers that participate across multiple platforms have far better branding and recall metrics,” Winter said in explaining the combined sales decision.
NBC succeeded in getting strong support in several key categories. It sold out the automotive category early by signing U.S. Olympic Committee sponsor BMW to an exclusive deal in the foreign automotive category and General Motors to an exclusive deal in the domestic automotive category.
It also did well in the financial services category. For the first time, the network partnered with the USOC to sell joint sponsorship and advertising deals in the retail banking, online brokerage and wealth management category. The duo sold sponsorship and exclusive media packages to Citi and TD Ameritrade in the first two categories, and Winter said he’s optimistic that they will find a wealth management partner before the Olympics, as well.
Panasonic, a member of the IOC’s The Olympic Partner program (TOP), is back as an advertiser for the first time in several Olympics. The company signed on as the presenting sponsor of NBC’s 3-D broadcast of the Games. The company also will advertise during the Games. It opted not to advertise during the 2008 Olympics and later raised questions about whether or not its competitor, Vizio, ambushed it during the Games with a commercial featuring a diver.
“Panasonic was heavily segmented in the past,” said Betty Noonan, vice president of marketing at Panasonic Corp., North America. “Leveraging the Olympics at a time when the company is pushing to become more global makes sense. The Olympics is strategically important because Panasonic at the end of the day makes some of the best products in the world, so there is no better venue to associate high-performance athletes with our high-performance products.”
While most Olympic partners have bought time on NBC, there are several Olympic sponsors that have opted not to advertise. Acer, an IOC sponsor since 2009, has not bought any time on the network. It didn’t make a buy during the Vancouver Games, either.
Winter said he hopes that NBC will be able to find another computer company interested in buying time.
“That category has tremendous upside because it’s a healthy category and because of the back-to-school window,” he said. “Apple has a tendency to spend closer in [to events] rather than farther out. We hope they come in at the end and make an investment.”
Allstate, the USOC’s official insurance sponsor, and Hilton, the USOC’s official hotel sponsor, also opted not to buy advertising on NBC. Winter said their decisions not to buy haven’t been an issue because competitors in the category already have bought time or will buy time during the broadcasts. Both sponsors advertised on the network during previous Olympics.
“We believe firmly that if you’re a rings holder you should be investing in the Games,” Winter said. “If you’re buying the [Olympic] rings and no one knows you own them, then why are you investing in the Games?”
Though the collaborative sales effort with the USOC helped bring on two new advertisers, Winter said he’d like to see a system develop where IOC and USOC sponsors have to commit to advertising as part of their sponsorships. He pointed to NBC’s relationship with the NHL as an example of the structure he’d like to see for Olympic sponsorships. New sponsors to the NHL sign media commitments as part of their sponsorship agreements.
“Culturally and philosophically, we’ve made a lot of progress. But practically, we have room to grow with each other,” Winter said, adding that NBC is already in discussions with the USOC about collaborating on sponsorship and ad sales for the 2014 and 2016 Games. “Anyone who secures the rings, a TOP sponsor or a domestic sponsor, needs to recognize the investment we make in rights [fees].”
The Marketing Arm’s Mary O’Connor, who works with BP, AT&T and Hilton Hotels, said it doesn’t make sense for every sponsor to advertise during the Olympics, especially not at a time when NBC is bundling its TV and digital media buys.
“If a partner is going to play in the Olympic space and their end goal is to reach a consumer audience, then they should most definitely play on NBC in the 17 days,” O’Connor said. “But at the end of the day, you can’t fault a brand for doing something that’s smart for their business, and sometimes television doesn’t provide the return on investment a sponsor is looking for.”
Buying into the Games
Confirmed advertisers for the London Olympics on NBC
Procter & Gamble
* — Only non-IOC and USOC sponsor
Source: SportsBusiness Journal
July 16, 2012 09:45 AM
For the first time in more than 15 years, U.S. Olympic fans will be able to buy and trade cards featuring Olympians such as Michael Phelps and Hope Solo.
Topps, the trading card company, signed a licensing agreement with the U.S. Olympic Committee that will put trading cards featuring more than 100 members of Team USA on the shelves of Wal-Mart, Target and hobby stores nationwide.The last company to have a similar agreement was Upper Deck from 1993 to ’96.
The deal gives Topps its fourth major sports partnership. It also has licensing agreements in place with MLB and the NFL and UFC.
“The Olympics are rare,” said Joe Ribando, director of player licensing for the Topps Co. “There’s a patriotic element to it. The interest level is always high and there’s always a lot of great buzz around it. We think this collectible item is going to resonate, as well.”
Topps struck a traditional licensing agreement with the USOC and worked with the organization to sign separate agreements with the 100-plus athletes who will be featured in the card packages. The packs will cost approximately $3 at retail and a portion of each purchase will provide direct support to the USOC.
In addition to Phelps and Solo, Olympians such as Abby Wambach, Allyson Felix, Lolo Jones, Ryan Lochte and others will be featured on cards. Select packs of cards will feature the autograph of high-profile Olympians such as Phelps.
“It’s names that have resonated in the past and newer names that we think will be up and coming in 2012,” Ribando said.
Peter Zeytoonjian, USOC managing director of consumer products, put the deal together with Topps. He previously worked at the NFL and has played a role in putting together other recent licensing agreements, such as last year’s USOC deal with Oakley.
Zeytoonjian said the USOC opted to do the deal because the trading cards offered a way for Americans to support and learn more about the athletes representing the country at the London Olympics.
July 16, 2012 09:44 AM
Entering an Olympic year, the U.S. Olympic Committee has added two new sponsors, announced two corporate renewals and seen none of its partners end their support, putting the organization well ahead of its sales efforts over the same periods prior to the 2004 Athens Games and 2008 Beijing Games.
At the start of 2012, the USOC has signed new sponsorships through 2016 with Kellogg’s and DeVry and renewed its sponsorships with BP and Nike. Those deals have contributed to the organization’s success in securing more than $38.8 million in domestic sponsorship revenue, about 25 percent of the $150.3 million in domestic sponsorship it generated for the 2009-to-2012 quadrennialThat performance contrasts with 2004 and 2008. By January 2004, the USOC had announced the signing of two new sponsors, 24 Hour Fitness and Nike, and the renewal of one sponsor, Home Depot. By January 2008, the organization had added one supplier, lost the sponsorship support of General Motors and announced no renewals.
“We’re where we want to be,” USOC chief marketer Lisa Baird said. “We’re closing some deals early, which is pretty exciting, but we have work to do.”
When the recession hit in 2008, the USOC reacted by reducing some of its sponsorship prices during the 2009-12 period. As a result, it signed more sponsors to keep its domestic sponsorship revenue on par with and eventually surpass previous quadrennials.
The USOC previously offered three sponsorship tiers. The high-level corporations, known as partners, paid $20 million to $35 million over four years; the second level of companies, known as sponsors, paid $10 million to $15 million over four years; and the lowest level of businesses, known as suppliers, paid $3 million to $10 million.
Anheuser-Busch’s current deal is the best example of how the USOC’s pricing changed. Between 2005 and 2008, Anheuser-Busch reportedly paid $20 million for its partner-level sponsorship of the USOC, but it renewed that agreement for closer to $10 million for the 2009-12 period.
Looking ahead, the USOC has already signed two of its four existing partner-level suppliers to deals through 2016. It brought on BMW in 2010 with a six-year deal valued at more than $20 million, and it renewed its agreement with BP last year through 2016 in a deal valued at more than $15 million. The only two partner-level sponsors it has to renew are AT&T and Anheuser-Busch.
It’s at the supplier level where the USOC will have to do most of its work. The organization signed one new deal at that tier with Kellogg’s, which extends through 2016, but five others at that level — Allstate, Deloitte, Hilton, United and 24 Hour Fitness — are all up for renewal.
The USOC has renewed a supplier-level agreement with Jet Set Sports and added DeVry as a sponsor at that level, but it still has one to renew with Oroweat.
“The overarching view of how we look at renewals is, first, what is the market like?” Baird said. “No. 2 is, in our contracts we have certain contract provisions in terms of when we can talk to them. Then clearly there is that subjective factor of momentum. We have London coming up and it’s going to be a great Games, and then we have Sochi and Rio, which we’re excited about and want to capitalize on.”
Baird said that the USOC’s strategy in approaching renewals called for the organization to renew its licensing partners first because they need to be able to develop product for 2013. That’s why it focused on renewals with Nike, Oakley and TeamFanShop, its online retailer. It is working on a renewal with its other major licensee, Ralph Lauren.
In addition to that area, the USOC also has to renew agreements with Citi and TD Ameritrade. It sold those sponsorships, which were hybrid sponsorship and media rights agreements, in partnership with NBC. Baird said that the USOC will wait until after the London Games to begin renewal discussions with those companies so that they have a chance to evaluate the results of their sponsorship.
July 16, 2012 09:44 AM
The U.S. Olympic Committee is rewriting the rules of its media rights agreements with national governing bodies.
Four years ago, as it was preparing to launch a TV network, the organization bought the media rights of 17 NGBs for $70,000 a year. The deals gave the USOC control over the NGBs’ websites and initial rights to any media content the NGBs produced. It allowed the USOC to create an umbrella site, teamusa.org, that operated as a league site for the NGBs’ team pages.The new agreements, which will cover the 2013-16 quadrennial, will see the USOC pay NGBs $25,000 to $150,000 annually based on their total traffic. The NGBs will retain rights to their event content, control production of events and distribution and retain full editorial content on their own website. The USOC will provide free website hosting, AP news feeds and free mobile Web platforms.
The USOC hopes to have all 35 Olympic NGBs agree to the new terms. It wants to build a total audience of 1 million monthly unique visitors.
“I’m hopeful we made a really appealing business proposition to them and more NGBs will migrate to our site under these terms,” USOC chief marketer Lisa Baird said.
The USOC is completing work on a new website, with WPP agency VML leading the development, and expects to roll it out in the first quarter of this year.
Baird said the USOC is creating a digital revenue model that will see it incorporate its digital offering into sponsorships. It also plans to offer some subscription services and hire employees with digital sales experience who can assist in selling advertising.
“Our mandate [from the USOC board] is to turn this into a revenue-generating entity,” Baird said. “We’ve generated revenue, but we haven’t looked at it as a revenue play. We’ve looked at it more as a brand and information play.”
The proposal has led some larger NGBs to give the USOC’s Web platform a second look. USA Swimming didn’t sign a media rights agreement with the USOC in 2007 because it was launching a swimming website with Wasserman Media Group. It subsequently brought those rights in-house and now manages its own digital operations. But USA Swimming chief marketer Matt Farrell said he liked the USOC’s new proposal both financially and in terms of what rights USA Swimming would retain.
“It’s a very prudent approach based on traffic and performance designed to reward performance and figure out how to monetize it going forward,” Farrell said. “We’re evaluating it and we like how they’ve approached this.”
The agreement has created some unease among smaller NGBs because it will bring another cut in what the USOC contributes to their organizations in the future. Many of those NGBs that generate the least traffic are the same NGBs that are expecting a cut in funding as the USOC begins to base its contributions to NGBs on their Olympic performance.
USA Bobsled and Skeleton Federation CEO Darrin Steele said he understood why that might upset some NGBs but added that each NGB has the chance to increase its traffic and get more money from the USOC. Plus, what the NGBs give up in money, they gain in flexibility.
“It’s a more dynamic arrangement,” Steele said. “It reflects the change in time and how media works now.”