LA28 marketing arm targets $2.5B in sponsorship
The marketing arm of Los Angeles 2028 will launch operations this week, taking the beginning steps toward meeting a $2.5 billion sales goal over the next decade.
The updated $2.5 billion domestic sponsorship budget would be the second largest in Olympic history behind Tokyo 2020, which will eclipse $3 billion. For an added challenge, the L.A. Olympic sales window will overlap with FIFA’s efforts leading into the 2026 World Cup hosted by the U.S., Canada and Mexico.
“We wouldn’t have built a budget based upon a number if we didn’t have great confidence in our ability to reach it,” said LA28 Chairman Casey Wasserman.
The budget includes a guarantee of $488 million to the U.S. Olympic Committee, Wasserman disclosed for the first time. Under International Olympic Committee rules, the USOC must merge its commercial rights with Games organizers from 2021 to ’28 to avoid conflicts.
The organization now launching is a joint venture of LA28 and the USOC, governed by a board that will include Wasserman, USOC Chair Larry Probst, incoming USOC CEO Sarah Hirshland and three other Wasserman appointees yet to be named. The chief executive of the JV is also yet to be hired.
Wasserman has been in talks with agencies to expand the reach of the sales team. The sales target includes sponsorships and licensing but not tickets and philanthropy. “There’s only a small handful who could handle an assignment of this scale,”
Wasserman said. “Suffice to say we’ll have conversations with them.”
About 30 members of the USOC marketing team will leave the USOC and become employees of the JV this month, including CMO Lisa Baird and three of the four senior vice presidents beneath her: Michael O’Conor, business development; Mitch Poll, partnership marketing; and Peter Zeytoonjian, commerce and events. Brian Gordon, who oversees marketing and media, is staying with the USOC.
The JV cannot sign any deals until January 2019. In the meantime, leadership will have three major tasks:
■ Create the inventory to be sold and develop the structure of the portfolio.
■ Build its staff.
■ Engage with current USOC domestic sponsors, whose current deals mostly go through 2020 and have the right to first negotiations with the JV.
Because of the IOC’s 2017 decision to award the 2028 Games at the same time as the 2024 Olympics, the L.A. team faces the unprecedented challenge of selling big-dollar sponsorships to an event that’s 10 years away instead of the usual six. Prices will vary, but bid documents price top-tier categories at nearly $100 million.
Wasserman said he believes the extended rights window is actually an advantage because of the scope of opportunities it provides. A sponsor would have the rights to the U.S. Olympic team at Beijing 2022, Paris 2024 and the 2026 Winter Games in addition to the L.A. Games. “The biggest challenge is really just that we have to have a compelling story and proposition that makes it attractive for sponsors,” he said.
Wasserman said talk of bundling sponsorship sales with Paris 2024 is gaining steam, at least in categories that provide operations, infrastructure or technology solutions to organizers. Such a bundled package would be a first in the Olympics, creating a new tier below the global level that would include exclusive rights to consecutive major-market Summer Games and the French and American teams.