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Volume 25 No. 25

On The Ground: Winter Games

Halfway through a tour of Intel’s tech wares at the Olympics, everyone got on a bus. The bus drove to a separate showcase run by KT Corp., the leading mobile provider in Korea, where Intel’s Olympics COO Julie Coppernoll turned the show over to a presenter clad in KT clothes.

KT showed us around its displays of what 5G connectivity will do for everything from entertainment to urban design. And then at the end, Coppernoll again took questions.

It was an unusual tag-team approach, but one that reflects the Olympics’ increasingly complicated, tech-focused sponsorship portfolio. Since the International Olympic Committee has started to seek sponsors that can both finance the Olympics and help organizers solve modern business problems, it’s turning more and more to diversified tech providers who are both competitors and cooperators, both b-to-b and b-to-c.

It’s a transition that’s required a new level of trust and attention to detail, experts said, because the backbone of sponsorship is still precisely defined, exclusive categories. While their natural instincts are to cooperate, fellow sponsors and the IOC watch closely to make sure they’re not encroaching on each other’s marketing turf.

Julie Coppernoll, chief operating officer of Olympics marketing, shows off a mobile network bay station with Intel hardware inside, which is submerged in mineral oil to protect it from the cold.
Photo: Ben Fischer

For instance: Intel can talk about its tech inside the coming 5G network, but demonstrating what it means for end users gets into KT’s rights as the domestic mobile provider category.

Another instance: Samsung’s massive showcase includes several virtual-reality experiences, but Samsung’s messaging on the VR must reference it being powered by its phone. This has taken on greater significance since Intel acquired the VR category last June.

Meanwhile, Visa and Fanatics teamed up with NBC on a feature that’s allowing Olympic viewers to buy the gear U.S. athletes are wearing on live broadcasts, but Chinese giant Alibaba has been the official e-commerce partner of the Olympics since January 2017. French IT giant Atos is the official IT company of the IOC, but Alibaba is the cloud-services rights holder and is promoting its ability to solve problems that Atos tackles now.

Anything that makes it to the Olympics has been closely vetted by the IOC for conflicts, but it’s a far more complex environment than classic sports marketing categories like property and casualty insurance or beer.

“As the IOC continues to bring on new tech partners and integrate new technologies into the Games, certainly it’s going to get a little bit more confusing, and the categories and the lines are going to get closer and blurred a little bit,” said Gary Pluchino, senior vice president of global partnerships at Endeavor.

These problems are not entirely new. Back in the 1990s, IBM was the Olympics’ technology partner, and at the time, some people believed that meant no one else could advertise their Olympic relationship on the internet, Pluchino said.

That’s similar to virtual reality today, where Intel has the rights to the underlying technology but Samsung is free to use VR to activate, as long as it’s demonstrating a function of the Samsung device. “Two years later, many sponsors will use VR in marketing their program, but that doesn’t mean they’ve made anyone’s category slimmer, it’s just that these categories are evolving,” Pluchino said.

A display of Alibaba’s planned “Smart Pass” app that will help Olympic visitors with tickets and planning.
Photo: Ben Fischer

The IOC says its categories are clearly defined but otherwise was not immediately available for an interview.

These finely defined categories, by their nature, don’t cover the full identity of the company in the way that “non-alcoholic beverages” encompasses Coca-Cola. Alibaba’s Alipay is a direct competitor to Visa in payment processing, but for the purposes of the Olympics, Alipay isn’t acknowledged. “Just because they have it doesn’t mean they can promote it,” said Hayle Chun, Pluchino’s partner as Endeavor vice president of global partnerships and Olympics.

The evolution has required more of the IOC, said Louis Vega, who leads Dow’s Olympic relationship. While not a tech company, Dow has been an IOC sponsor since 2010 and is a b-to-b company that depends on others to get its product to market. He said nonprofits and the government often don’t understand that businesses can be competitors and partners at the same time.

Also, he said, the sponsors themselves need to be sure of their position and how it connects to others’ before they sign up. “Hopefully your marketing rights match your strengths, and you know those strengths, and you’re very comfortable there,” Vega said. “And you’re comfortable knowing that Company X has a strength that might sound adjacent or similar, but it’s technologically very different.”

Ben Fischer

Saturday morning, I woke up in a fluffy bed on the 14th floor of the Millennium Seoul Hilton and had tea while looking out on a prosperous world capital. By noon, I was 240 feet underground in the Korean Demilitarized Zone, staring down a cramped tunnel into the most dangerous, mysterious country on earth.

After Friday’s opening ceremony, I took a side trip away from the Pyeongchang Winter Games to visit the DMZ, one of the world’s great morbid curiosities. What I saw reminded me how extraordinary it is for the North and South to even talk to each other, much less field a combined Olympic team.

Military installations are at every turn. The guns are literally pointed. If you stand still, you can hear the high-pitched sounds of the North’s propaganda speakers blasting southward. Across an inlet, you can see hills stripped clear of trees so Kim Jong-un’s dictatorship can easily spot and shoot defectors running for the water.

Photo: Ben Fischer

This scene is just a day trip from Seoul and the Olympics. The proximity of evil and war is more than a little unsettling for an American who grew up with the luxury of friendly neighbors and two oceans to protect us.

Just 20 minutes after we boarded our bus at the Hilton, our tour guide, Cindy, pointed to the left side of the highway. “See, there’s barbed wire and the military lookout posts along the river, because we’re so close to the North. They could swim across.”

As I gaped, I thought we must have gone farther than I realized. It looked like we were still in the suburbs. Turns out, we were. She pointed to the other side of the highway: “You see the apartments over there, they never go up in price because you’re so close to the North.”

Unsettling as it was, Cindy’s real estate comment was the first of many reminders that this is simply daily life for South Korea. Yes, 20 million people live in metro Seoul, all well within the range of the North’s heavy artillery, but it’s been that way for three generations now and they thrive with a mix of distrust, resignation and hope for the North.

The Dora Observatory is both a tourist attraction and military installation with a high view of the western DMZ.
Photo: Ben Fischer

Our first stop was at the Dora Observatory, a hilltop where you can see both sides of the DMZ, the frozen river that roughly separates control of the zone and, in the distance, the North. We put 500 won coins into binoculars and saw the creepy “Propaganda Village,” a town the North has named Peace Village and claims has 200 prosperous residents but shows no sign of human activity at midday Saturday.

At the next stop, we walked through a gift shop, donned hard hats and walked down a steep path tunneled into the bedrock by the South Korean army. Gas masks are stored every 100 feet or so, with instructions in English and Korean.

When the grade finally leveled out, it all changed. The tunnel got smaller and cramped. We were inside the “third tunnel,” the third of four tunnels discovered so far built by the North in a bid to facilitate an invasion. The ceiling shrunk to about five and a half feet high, and I crouch-walked another 160 meters to a barrier, just 170 meters from the Northern side of the DMZ.

The view through binoculars shows a river that cuts through the DMZ. Just past the water is the border, or The Military Demarcation Line.
Photo: Ben Fischer

From there, you could see to another barrier. Behind that, there was a third hidden barrier, the last thing between us and North Korean territory. Supposedly, 30,000 North Korean soldiers an hour could get through that tunnel, and when the South discovered it in 1978, it stopped just 27 miles from Seoul.

Here’s the scary part: They’ve found four tunnels, but experts believe there might be 20 more they don’t know about.

To my surprise, we did not visit the Joint Security Area, the best-known part of the DMZ, where the North and South soldiers eye each other from just a few hundred feet away. (That requires an extra level of vetting.) So I didn’t get the picture I was hoping for, but in visiting the other facilities, I understood better the day-to-day civilian life near the border.

Me at the platform for non-existent trains heading to North Korea capital Pyongyang, about 150 kilometers away, at Dorasan Station.
Photo: Ben Fischer

Our last stop was Dorasan Station, the train station built to service a line that goes to the North’s capital of Pyongyang, if the day ever comes when that’s allowed. Hundreds of names are engraved on a wall there, those of South Koreans with family still in the North who want to take the first trains that way.

These few hours gave me a deep sense of dread. Intellectually, I know war is not likely for a variety of reasons. But Lord, it could be so easy, and it galls me to hear Americans clamor for a hard line on the North from 6,000 miles way.

But for Cindy and many other Koreans, the DMZ is a booming tourism business. They don’t take it in stride, exactly, but the warring history and present tension is baked into the equation of life. Only as an aside, she mentioned that one of her good friends is a North Korean defector whose mother was shot and killed as they escaped to China in her childhood.

An army observation post and reinforced fencing along the upper Han River, as shot from a bus.
Photo: Ben Fischer

She laughed when someone asked her if she’s afraid of Kim Jong-un. “He doesn’t want this country to be a wasteland,” she said.

On our way home, we hit traffic in Seoul. I was still thinking about how close we were to that tunnel. But as we stopped, Cindy looked across the Han River to the skyline and said, “Look at all of these buildings. … After the Korea War, there was nothing here. It was like Ground Zero. Everything you see here has come in 60, 70 years. I am very proud of this city.”

* * *

(Note: I joined a tour arranged by 24 Hour Fitness as part of a trip to the Olympics for its top-performing club managers. Coverage of the U.S. Olympic Committee sponsor’s broader hospitality program can be found here.)

Photo: Ben Fischer

The ninth edition of the USA House is a reflection of the entire Pyeongchang Winter Games: smaller, less corporate, but not without a quaint charm.

Expecting lower demand from sponsors for hospitality space and fewer U.S. travelers overall in South Korea, the U.S. Olympic Committee built just a 5,000-square-foot facility. It’s actually the same modular, traveling building it used in Sochi four years ago, but with 2,000 fewer square feet. The blond wood and glass structure was built by Austrian company Hochsitz by Loidl.

Photo: Ben Fischer

There’s not much to it, really. After you clear the entrance foyer, there’s one large room with a bar on the right, a 30-foot-long projection screen on the interior wall to the left, and a smaller private room around the corner.

But the real joy of the house is its panoramic windows and its location at the base of one hill at the Yongpyong Alpine Centre. Several sponsors and other guests have praised the location, calling it intimate and convenient.

Photo: Ben Fischer

During the day, it lets in more than enough sunlight to light the entire facility, and at night, the flood lights against the snow make you feel like you’re in the audience at a play. In a sense, you are — during a media welcome party last Wednesday, I filled in the gaps in small talk by watching recreational snowboarders fly down the hill, stopping just feet from me. (One guest who visited during the day, though, said the sunlight is too much, quickly heating the room past the point of comfort.)

Photo: Ben Fischer

Also, USA House is just a few steps away from the Swiss House, Procter & Gamble’s Family Home, several hotels and a shopping mall. If there were such a thing as time off at the Olympics, you could spend an afternoon just hanging out.

There are no planned sponsor-hosted events for the house, but sponsors are entitled to bring their guests to relax there, and the brands do have a presence: The walls are decorated by old-fashioned toboggans painted for all of the USOC and International Olympic Committee sponsors. Along with passed hors d’oeuvres, Hershey’s had its new Gold caramel creme bars and Krave jerky packets out for snacking; Mondelez’ Ritz and Oreos products were out, too.

Photo: Ben Fischer

One noticeable absence: Since Budweiser declined to renew its USOC sponsorship after the 2016 Rio Games, the bar is unbranded for the first time. All prior USA Houses had red-paneled Budweiser bars; this year, USA House is pouring Kloud, a Korean brand, and Stella Artois.

U.K.-based Living Hospitality is providing the catering service, but its workers were mostly Americans. Especially friendly ones, too.

Robert Thomas is a meat-and-potatoes kind of guy who’d never been to the Olympics, never been to Asia and certainly hadn’t eaten Korean food. But because he absolutely crushed his first two months as general manager of a 24 Hour Fitness club in Solana Beach, Calif., last year, he’s on a free six-day trip to the Pyeongchang Winter Olympics.

“This is a huge out-of-my-bubble experience, and it’s been a lot of fun so far,” he said Saturday, on the way back from a side trip to the DMZ, the highlight of his second day. The night before, he’d attended the opening ceremony.

24 Hour Fitness CEO Chris Roussos looks at North Korea through binoculars on a trip to the DMZ.
Photo: Ben Fischer

Thomas was one of 11 internal contest winners treated to the vacation by the longtime U.S. Olympic Committee sponsor, which uses its sponsorship to reward high-performing staff, supplies Team USA training centers stateside, and staffs and supplies temporary training centers at the Summer Olympics. CEO Chris Roussos and his wife Karen were also on the trip.

The Olympics program is part of an incentive-heavy system the gym chain uses to compensate local managers and encourage retention, Roussos said.

“What we find is culturally, when you put these incentive trips out there, it creates a lot of momentum and excitement in the organization,” Roussos said. “It keeps people fired up and continuing to stretch and reach. First things first, you’re never going to win unless your club is running really, really well.”

The hospitality program stands out among Olympic sponsors because it’s not about C-suite clients or would-be investors. The local managers are usually in their 20s or 30s, and get a rare chance to spend full days with both Roussos and elite peers.

For Korea, 24 Hour’s trip was based at the Millennium Seoul Hilton, a central location where they could take in cultural sites and have a two-to-three-hour bus ride to the Olympic events.

The 24 Hour Fitness award winners sample Korean food at lunch at Yoree restaurant north of Seoul.
Photo: Ben Fischer

They all landed at Incheon International Airport on Thursday. Then on Friday, two-time 2002 speedskating medalist Derek Parra addressed the group in the morning before they traveled to Pyeongchang. There, they visited USA House, where they had a chance encounter with U.S. bobsled pilot Elana Meyers Taylor and her husband Nic Taylor, an Olympic alternate, before taking in the opening ceremony.

After the DMZ trip on Saturday, the crew had a Seoul tourism day planned on Sunday, followed by Olympic events and a meeting with USOC CMO Lisa Baird and Chief of Sports Performance Alan Ashley on Monday, before heading home Tuesday.

24 Hour Fitness organizes and executes the trip in-house, said Victoria Hoe, the director of member marketing who oversees the Olympic relationship.

Thomas said he’s a big Olympics fan but was glad to see other parts of Korea, too.

“There’s a lot more culture than I realized we were going to experience,” he said. “But it was awesome. Going to the DMZ today was incredibly interesting. It made the world seem a little bit smaller.”

24 Hour Fitness has been a sponsor of the USOC since 2004 and extended its deal last year through the Tokyo 2020 Games. In Tokyo, like at all Summer Games, the 24 Hour contingent will be much larger because it brings staffers to work at the USOC training centers. The winter team does not establish permanent training centers in the host city.

South Koreans are hardly unanimous in their opinions about the unified Korean Olympic team and the temporary rapprochement with the North.

South Korean President Moon Jae-in shakes hands with Kim Jong-un's sister, Kim Yo-jong, before Friday night's opening ceremony.
Photo: GETTY IMAGES

Some protested outside the opening ceremony on Friday, believing Kim Jong-un cannot be trusted and is just papering over his nuclear aggression. During the weekend, my tour guide Cindy told me she was upset with South Korean President Moon Jae-in for welcoming such a large contingent from the North, including Kim’s sister.

It’s not that she is opposed to attempts at unification, but that the North stole the South’s thunder. “In the days before the Olympics, all the news was about Kim, not South Korea,” she said. “This is supposed to be our Games.”

“I was so angry,” she continued. “Even though I am a fan of Mr. Moon, I felt that was very not right.”

She’s right about the South Korean’s moment on the world stage being taken over by the Kim dictatorship. News coverage in Pyeongchang focused on the legitimate rarity of seeing Northerners traveling in the South, and sister Kim Yo-jong is “stealing the show,” according to CNN.