As many of you have read in recent years, especially after the 2014, 2016 and 2018 Olympic Games, there has been talk — particularly in North America — that the Olympics, as a sponsorship property, wasn’t working. We kept hearing things like “young people don’t care about the Games” or “the TOP program has seen its best days” or even “Look, McDonald’s just left the Olympics.”
Well, we were with you … but, wow, were we ever wrong.
First, just days after the high-profile McDonald’s exit, four new TOP sponsors joined, and they were blue-chip global brands: Intel, Bridgestone, Toyota and Alibaba. We’ll grant you that Tokyo 2020 and Beijing 2022 are big draws for global icons with strong Asian footprints, but Paris, Milan and Los Angeles are slated to follow as host cities in 2024, ’26 and ’28, respectively, and each is an attractive location in its own right.
Further, the International Olympic Committee’s numbers back up our revised premise. A review of the IOC’s published annual reports shows the TOP program hit its highest revenue to date during the 2013 to 2016 quadrennial, eclipsing the $1 billion mark for the first time. With four new partners, we’re confident the 2017-2020 number will finish even higher. And just so you have it as a comparison, the first round of TOP (1985-88) drew a mere $96 million from nine sponsors.
Additionally, as you may have seen, the Tokyo 2020 host committee announced a record level of domestic sponsorship revenue, an amount more than triple the previous record. One source suggested Tokyo 2020 has exceeded $3 billion. Yes, triple what the TOP program brought in during the last quadrennial. Of course, Tokyo is another repeat host, but that’s a spectacular number for a local organizing committee, particularly since all national Olympic committees and international sport federations will participate in post-Games revenue sharing.
Why make a big deal about this development?
Well, for both of us, it is significantly reassuring. For two academics who worked for, followed or researched the Olympic Games and global sponsors, this outcome seems to compensate for the challenges the IOC faced in finding host cities for the 2026 Winter and 2028 Summer Games. Consider: Most pundits said the Olympics were less relevant to young people and trends for consumer brands would be to move sponsorship dollars into properties generating deep (and digital) activations (like esports).
But hold on! Olympic sponsorship is growing.
Not that we ever doubted the role of sponsorship in the marketing mix. It’s as vibrant as ever and continues to take spending away from advertising and direct mail. But we briefly joined the chorus shouting out the Olympics had died and, in a nod to Monty Python, that someone should bring out their dead.
So, what drove this incredible result for Tokyo 2020? Was it geography? Did Asian tech companies come to the party while North American behemoths slumbered? Did Tokyo hire stronger salespeople to sell higher Games packages faster than anyone in history? Did Japan invent new mass mediums that haven’t arrived in the U.S., Canada and Mexico yet?
The answers we uncovered may not surprise but they shouldn’t be taken lightly. First, the Olympics still cater to all genders simultaneously and the Summer Games routinely involve athletes from more than 200 countries. That will continue to beat a single-gender World Cup or a championship that involves only 32 teams or countries any time and day … or should we say during any two-week period!
The city of Tokyo also deserves some serious credit here, as does Beijing for that matter.
Japan is the second Asian country to host the Games in a string of three straight (Pyeongchang 2018, Tokyo 2020, Beijing 2022), and capital city Tokyo is arguably the most important city in a region of the world featuring two-thirds of the world’s population. Beijing is arguably the second most important.
With no disrespect to Mumbai, Shanghai, Singapore, Hong Kong, Jakarta, Kuala Lumpur or Seoul, we think Tokyo is still the biggest dog at the bowl when it comes to technology, innovation and service efficiency. Tokyo-based businesses (think Toyota, Asahi, Asics, Canon and NEC) are massive global players who continually show they will support Japan’s mega-events.
Further, and this may be lost on some casual SBJ readers, Japan may seem more familiar to worldwide viewers than Beijing and Seoul. That’s not to say that any one country is better or more accomplished than another, but Tokyo has shown since winning the bid and announcing they would deliver “the technology Olympics” that they will do things no one else might undertake.
Driverless cars, spectacular artificial intelligence, intuitive phones, robot volunteers (speaking 60 languages) and non-invasive security measures: All of these and more are part of what Tokyo will unveil in less than a year.
Many readers may not attend Tokyo’s party, but you won’t want to miss out on looking into what a thoroughly modern country can do with technology infrastructure, data management and really notable sponsorship leverage.
Rick Burton is the David B. Falk Professor of Sport Management at Syracuse University and the 2008 chief marketing officer for the USOC. Norm O’Reilly is director of the International Institute for Sport Business & Leadership at the University of Guelph and Partner Consultant at T1.
Questions about OPED guidelines or letters to the editor? Email editor Jake Kyler at jkyler@sportsbusinessjournal.com
