Advertising Gold: Marketing in the 2008 Summer Olympics

On July 13, 2001, Beijing, China was honored with the right to host the 2008 Summer Olympic Games. Opening ceremonies are set for August 8th, with closing ceremonies commencing on August 24th. This summer, there will be twenty-eight different sports being played across thirty-one venues, with three-hundred and three medals being awarded to athletes coming in first, second, and third place. These upcoming 2008 Summer Olympic Games (logo pictured on the left) will prove that athletes will not be the only ones winning gold medals. Companies across the globe are anxious for the games to begin so they can promote and share their image and products with the world. Although advertising in Olympics held overseas is too expensive for some companies in the United States, the decision to market to a broader audience can and will benefit these corporations fortunate enough to sponsor the games. The costs of becoming a sponsor may thwart some companies from doing so, but the firms able to advertise during the games will see a greater profit and return for their money.

This year's Olympics may not only surpass previous Olympiads in terms of athletic performance, but it will be the most advertised ever. It is estimated that over seventy companies will be sponsoring the Beijing games, and they will consist of three tiers of support: Worldwide Olympic Sponsors, Beijing 2008 Partners, and Beijing 2008 Sponsors and Suppliers. Some of the Worldwide Olympic Sponsors are McDonald's, Coca-Cola, Visa, Kodak, and General Electric (see picture below to the right). Beijing Partners include Volkswagen, Adidas, and Johnson & Johnson; whereas Beijing sponsors and suppliers are comprised of companies such as UPS, Budweiser, Snickers, and Staples. These companies are looking for an advantage over their competitors, and the answer is the XXIX Olympic Games. Some firms are paying up to two-hundred million dollars for the privilege of becoming an Olympic partner, while others are spending an average of seventy-eight million dollars to be sponsors or suppliers. It seems like a hefty price tag to some, but the benefits that result from it are astounding. Olympic sponsors are already seeing their stock prices soar.

Every four years, the Summer Olympics are held in a different country and in an overall different setting. Going international may be troublesome for some well known businesses in the United States due to high costs, but popular firms such as McDonald's, Coca-Cola, and Visa are first in line to be partners. Advertising will help increase sales and stock price, which will in turn generate more profit. It is proven that the corporation promoting itself will increase brand and product knowledge amongst the millions of viewers and attendees of the Olympics. In fact, a recent study done by Initiative Sports Futures claims that the Opening Ceremony alone could be the first sporting event ever to attract over one billion viewers. Pierre Justo, the Beijing-based managing director of sports research for TNS Sports Asia, says "The scale is totally different from previous Olympic Games. Everybody is waiting for TV audiences, especially in China, breaking records. We will see figures we've never seen before." McDonald's stock price rose twenty-one percent after it sponsored the 2004 Olympics in Athens. Granted sponsoring the Olympics was not the only cause of this increase, but it can be inferred that it was a major influencer. From May 2004 to December 2004, McDonald's, Johnson & Johnson, and Kodak's stock prices all increased by six dollars and General Electric's rose five dollars. This is proof that advertising in the Olympics can be one of the smartest things a corporation can do. Their advertisements and logos are sure to be seen by millions of people all over the world, which will definitely increase market share and profits. Companies going international tend to do well overseas as well as in the United States, and global advertising and expansion are two major reasons why they succeed.

Corporations looking to expand internationally, especially within the thriving Chinese economy, have the opportunity to advertise and sponsor the upcoming Olympic games. It will provide a chance to grow while allowing each partnering company to showcase its products or services to the two-hundred and three different countries representing this years' Olympics. According to Nathalie Bastianelli, head of Havas Sport China, "This is the potential of the Chinese market [...]With its economic growth, the brands are very interested in this market and a big event like the Games is a good opportunity to get closer to the Chinese consumer." Adidas is one of the primary international corporations hoping to strengthen its presence in China, even though it already holds over thirty-five hundred outlets in four-hundred cities. Erika Korner, head of Adidas' Olympic program, states: "It was an obvious decision for us to sponsor the Olympics in a country where our growth is highest." Many companies are following suit, including UPS and Budweiser.

When August 8th arrives, there will be many familiar brands and advertisements displayed during each competition. The number of recognizable corporations on television as the games are in progress will be astonishing. Advertising and sports are considered norms in our culture, so when the two merge they create the best possible situation for a company to market itself. The potential is there to expand business and increase market share. Firms just have to be willing and able to spend the millions of dollars needed to sponsor 2008's games. The risk is sometimes worth the reward and the benefits will outweigh the costs, and advertising in the Olympics is one of those situations.