Sponsorship has been increasing in popularity as a marketing tool for brands to create awareness, drive sales or new business, and increase customer loyalty or employee engagement.  With added interest and investment in Sponsorship, brands are now beginning to tread very carefully around the marketing tool and here are some of the reasons why. 

Mismatched brands and rights

Brands spend a lot of time and money carefully planning and deciding on the right property to sponsor (either this or its Chairman’s choice).  Despite this, there are brands that have spent huge sums of money on the wrong rights, which have not paid dividends and certainly haven’t offered much return on investment.  In some cases sponsorship has had negative effects in terms of ROI and a bad fit between brand and property has led to damaged reputations for the former and reduced commercial value for the latter.  However, today, brands have become much savvier about what they attach their name to because of the huge cost of sponsorship and with the global recession this has never been as crucial as it is now. 

Financial Services

During the recession’s worst moments any financial services company about to spend money on sponsorship was met with harsh criticism and serious public backlash.  Even now, as we begin coming out of the worst of it there are still strong opinions on the practice.  Bank of America ended any talks with the New York Yankees due to huge financial difficulties and UBS cancelled its sponsorship of the Hong Kong Open after it received a $59.2 billion bailout from the Swiss government.  Both did so for fear of major public backlash.   RBS on the other hand announced $41 billion in losses just after extending its sponsorship of the Six Nations – a decision which was met with outcry, especially as it is 70% owned by the government. 

The effects of digital

With digital, bad news can travel extremely fast.  This has meant that companies have had to rethink marketing strategies.  Bad press around a property can cause devastating effects for any company that has created a strong association through heavy marketing activity.  To illustrate the enormous implications of a scandal, combined with the power of digital, just look at Tiger Woods.  As soon as the story broke about his behaviour it spread across the world in seconds.  Shareholders of Nike, Gatorade, and other sponsors consequently lost a collective of $5 to $12 billion due to a significant drop in their stock’s values. 

Embarrassment 

Poorly performing teams, embarrassing scandals, politically damaging stories.  These are all reasons for brands (or in some cases properties) to cut-off associations with partners.  Famous and very recent examples of this are Accenture dropping Tiger Woods, Nationwide dropping the FA, and only last week, two Indian state-run firms – NTPC and Power Grid Corp of India – have decided to scrap their multi-million dollar sponsorships of the Delhi Commonwealth Games due to negative publicity around allegations of corruption, mismanagement and malpractice. 

In addition, the BP oil fiasco that has engulfed the Gulf of Mexico has severely damaged the reputations of many of the arts properties it sponsors, primarily The Royal Opera House, Tate Galleries, and British Museum.

Brands are now very cautious about what they attach their name to.  Understanding sponsorship and the effect that it has on consumers is key to understanding the possible risks of association, as well as the benefits.

Will Carling famously referred to the game in England as being run by ’57 old farts’ back in 1995 when he was national captain. However, English rugby (union) has come a long way since then. Admittedly results haven’t been entirely awe inspiring following the 2003 World Cup triumph – but in commercial terms the future looks rosy.

According to SportsPro magazine, in 2009 “games at Twickenham generated £29.2 million for the RFU, accounting for a quarter of their £118 million turnover. The union’s gate receipts have actually increased by £4.1 million since the 2006-2007 season.” Last season in the 6 nations “England could have sold out its 82,000 capacity Twickenham stadium twice over for each of its two home games”.  Additionally, “England received the largest economic boost from the tournament, with a total of US $132.82 million spent by fans on match tickets, transport, food and beverage sales, accommodation, merchandising, and at city attractions, and by sponsors on marketing”.

Hospitality and marketing have been important aspects of the increased commercialisation of rugby in the country where Webb Ellis first picked up the ball. In terms of sponsorship, England’s involvement with O2, its principal sponsor since 1995 when it was known as BT Cellnet, has been both beneficial and lucrative for rugby. England’s mixed broadcasting package, unique to the home unions, with both Sky and the BBC ensures strong annual TV revenue. The BBC covers home games in the 6 nations while Sky covers the autumn internationals and much more – from U20 internationals to the Army and Navy game. Looking to the future, England will also host the 8^th Rugby World Cup in 2015. The Rugby World Cup is the third largest sporting event after the football world cup and the Olympics. When staged in France, in 2007, it delivered “a total economic impact estimated at up to £2.1 billion” for the host nation.

Domestically the picture looks bright too. Aviva, the fifth largest insurer in the world, has recently replaced Guinness as the official title sponsor of England’s premier club rugby competition. In a 4 year deal, Aviva will pump £20 million into the renamed Aviva Premiership. In another exciting move, JP Morgan Asset Management earlier this year launched a Sevens tournament for the 12 premiership clubs. This is a bold move which aims to build on the momentum that entry into the 2016 Olympics has given the shortened version of the rugby game.

There are, however, some small dark clouds for rugby in England. The so-called ‘Bloodgate’ scandal has left a bad taste in the mouth (quite literally). The affair has tarnished the image and reputation of both Harlequins (one of the oldest clubs in the game) and the sport in general. It would certainly have been scrutinised by sponsors even though Etihad Airways has signed a one year extension to its sponsorship with the Harlequins club.

The relationship between the Premiership clubs and the national squad is not always a comfortable one. Like in football, there are arguably too many overseas stars in the domestic game. If selection of these players curtails the long-term playing development of home grown talent the results of the national side may suffer in years to come. Some players in the national side are also plying their trade overseas and this has led to friction between their respective clubs and Martin Johnson’s national squad. This was notably the case when the French club Toulon refused to release Jonny Wilkinson for a recent England squad summer camp. To keep revenues coming in, the RFU needs to carefully manage these issues to ensure that its strongest side runs out at Twickenham in order to attract sponsors, broadcasters and keep fans streaming through the turnstiles.

The upcoming season promises to be an exciting one as the rugby community looks forward to the 2011 Rugby World Cup in New Zealand. Whether Martin Johnson and his England team will get their hands on the Webb Ellis Trophy again remains to be seen.

One thing we do know for sure – on the commercial front English rugby is in great health.

Lately, it appears that the dreaded ‘S’ word has started to lose its negative connotations in the aftermath of one of our worst economic crises in recent times. Yes, sponsorship is slowly beginning to reassert its authority in the marketing mix and with just cause.

The recent announcement that consumer giants Procter and Gamble has signed up to become the 11th global sponsor of the London 2012 Olympic Games will be a huge morale boost to those involved in international sports sponsorship. P+G, as you would expect from such a world renowned firm, are in good company on the 2012 list, which also boasts tech giants Panasonic, Acer, Atos Origin and Samsung. And it is not only global corporate who are being encouraged to sign up. As the BBC reports, small and medium sized firms are also lining up to get a piece of the Olympic dream in 2012.

The International Olympics Committee has confirmed that close to $900m has been accumulated in sponsorship revenue and it is hoping to top $1bn. And they say that sports sponsorship is suffering…

With just over 700 days until the start of the 2012 Olympics, it is worth recognising the plethora of opportunities that exist for brands wanting to gain true global recognition through a sports association. Whether it is the four yearly bonanzas like the Olympics and the World Cup, the truly international annual motorsport championships like Formula One or MotoGP, or more regional events or series, the perfect sports opportunity is there for the taking, if only you know where to look.

An article on PR Week a few weeks ago looked at the results of a recent Echo Research poll (of 1,002 adults in the UK) which found a surprisingly low awareness rate of brands sponsoring this year’s World Cup in South Africa. Coca-Cola and McDonalds, both sponsors of London 2012, garnered the highest recognition but less than 50% in both cases. Interestingly, Nike was identified by 20% of people even though they were not actually sponsor.

It is hardly surprising to see a name like Nike on the list, just as we may well see Coca-Cola on a similar poll in modern day Formula 1. This unintentional or intentional ambush of rival brands on high level sporting events is to be expected and brands should build that into their own activation programmes to minimise the impact. Activation is more critical for less visible sponsors as they seek not only to gain a bigger piece of the sponsorship pie for any event, but also to fend off their own rivals attempts at hijacking coverage.

The low recall rates themselves have nothing to do with the value of sponsorship as a marketing tool, but perhaps more to do with the audiences that were targeted or the ways in which the sponsorship was activated.

Before we start writing off sports sponsorship because recall rates in this particular research are low, let’s remember that McDonalds may only have used the World Cup to target 20% of the UK audience and with that achieved their sponsorship objectives. Success from sports sponsorship is a very individual analysis and cannot be assessed by sweeping judgements based on a small cross-section of society. As long as brands like McDonalds continue to plough substantial finances into sponsorship of sporting events, one must assume they are deriving the necessary return on that investment.

The same must be said for technology brands whose primary objectives in a sports involvement may be less to do with outright branding and more to do with technological showcase of their product in a sporting environment. We have worked with a number of tech brands for whom this last point is the single most important aspect of their marketing strategy and in these instances the returns from a sporting involvement far outweigh the impact of their corporate logo in a stadium, on a shirt, on a car or on a website.

Sponsorship is not a one case fits all marketing tool. It is bespoke, adaptable and tailored to each company’s own strategy and unique brand attributes. To say that sponsorship is not successful on the basis of a small non-targeted questionnaire is short sighted and completely misses the point.

A new fundraising initiative to get small-medium sized businesses to invest marketing budget in a programme that’s raising money for British athletes has received a luke warm response from sports sponsorship experts I’ve spoken to.

As I reported in my previous column on UKSN, there are literally thousands of businesses in London that can’t afford to be a sponsor or licensee of London 2012 and who don’t have other viable options in front of them so as to get involved in embracing the Games that will take place in their backyard. It was a point I raised at a meeting recently with representatives of LOCOG who really hadn’t got any new ideas to offer.

However, last week an announcement was made about “Our Team2012″ which on the surface looks like there is a solution to meet this pent up desire of SMEs to get involved with London 2012.

Like many in our industry, I wholeheartedly applaud the efforts made to raise money for the support of our athletes in their preparations for London 2012 and Visa, the “Presenting Partner” of Team2012, has done a great job in supporting young athletes in their Olympic journey.

However, closer examination of the PR behind the offer “Support the medal quest, benefit your business, join Our Team2012″ reveals a very different picture when it comes to evaluating the return on investment (ROI) for SMEs.

The background to this latest initiative is the shortfall in funding of athletes that want the best possible chance to compete in London 2012.

In January 2009, UK Sport confirmed that eight Olympic and four Paralympic sports wouldn’t receive the funding allowance promised to them for the London Olympic/Paralympic cycle. In short, this was down to the failure to raise any of the £100m targeted from the public sector.

After months of deliberating over the doomed “Medal Hopes” programme, the Government generously allocated £50m of public funds to soften the blow to sports in the UK in the run up to London 2012.

UK Sport was then left with the difficult decision of which sports wouldn’t get the allocation promised to them. Given the circumstances and their ‘no compromise’ approach to funding, they handled this task with aplomb. Nevertheless, 12 sports suffered and some athletes were left hung out to dry having committed their lives to achieving their Olympic and Paralympic dream.

September 2009 saw the launch of Team2012, a fundraising initiative tasked with raising half of the shortfall in elite sports funding, £25million.

And now this current fundraising initiative, managed by FastTrack on behalf of LOCOG, the BOA, the BPA and UK Sport hopes to raise £15m.

Having read the documentation around this programme, my initial excitement quickly turned to bemusement.

Put simply “Our Team2012” is a corporate hospitality package valued at £9,900 (+VAT) per year for two years.

Each year, companies will be offered a package including two tickets for a drinks reception at the BOA and House of Lords, eight tickets for two Regional seminars, four VIP tickets for sporting events held in the UK and two tickets to a gala dinner at the England Institute for Sport.

Team2012 athletes (i.e. Lottery Funded athletes) will be in attendance at each of these events. In addition, companies get to use the moniker “Our Team2012”.

So is this the chance of a lifetime which the marketing brochure claims it is?

“Being generous, the events package is worth about £6,500 so in affect companies who choose to get involved with this would be donating £3,500 to the cause each year,” observes Karim Bashir, MD of Catch Sport and a former Olympic fencer.

In the current economic climate, given the increased focus on ROI within sports sponsorship, including CSR, the sums simply don’t add up.

There’s no doubt that the money raised through this fundraising initiative is much needed but SMEs need to have a business case to justify this level of expenditure and this is where it falls short.

It’s unclear exactly how the money raised will be spent. It’s likely that none of this money will go directly into the athletes’ pockets but will be distributed on behalf of the bodies behind it for funding infrastructure projects.

There’s no guarantee that any of the 12 sports who suffered funding cuts will see any of this money and on top of this there will no doubt be administrative costs.

The big issue for SMEs to consider is that this “opportunity of a lifetime” offers no direct association with the Games itself. LOCOG, quite rightly, has to protect its sponsors’ rights and strict rules don’t permit any suggestion that “Our Team2012” has a directly link with the Games.

So are we running the risk of having a constellation of logos all fighting for our attention? When I last spoke to Wally Olins CBE about this, his view was that creating more logos simply wasn’t the answer, especially in light of the new London logo that Mayor Boris Johnson is due to launch very soon!

Therefore the value of the use of yet another logo is highly questionable.

So what other options are available to SMEs if the Our Team2012 fails to win their marketing budgets?

“There are many other alternatives which offer a clear and more measurable ROI” claims Bashir.

“For a start the National Governing Bodies of the 12 sports that suffered funding cuts are desperate to find corporate sponsors and could certainly provide a comparable hospitality package, let alone the branding benefits an NGB sponsor would get from providing much needed funds to an Olympic/Paralympic sport.

“There’s also the option to sponsor a couple of 2012 hopefuls from your location for that kind of money. And another option would be to support the British Athletes Commission who are the voice of elite athletes in the UK,” concludes Bashir.

Read the full story

By Ardi Kolah

Over the last 48 hours, senior sponsorship executives from 55 leading brand owners including adidas, Nike, BT, Barclays, LloydsTSB, Thomas Cook, Emirates, O2 and others received an invitation to take our short survey on their corporate social responsibility (CSR) and grass roots activities as part of their investments in sports sponsorship.

In broad terms, the survey explores the importance of CSR within the total marketing and communication mix, the underlying reasons for investing in CSR and grass roots activities, the impact on reputation and image of the brand owner and whether they measure outcomes as a result of these activities. We hope to survey the attitudes of all London 2012 sponsors at all levels plus those sponsors that spend the most in football, rugby, cricket and athletics.

I want to express our sincere thanks to Karen Earl, chairman of the European Sponsorship Association, Sally Hancock, Director, Olympic Marketing, Lloyds Banking Group, Mark Phillips, Head of Brand Marketing, adidas and marketing guru Peter Fisk who provided us with invaluable guidance and input regarding the survey at meetings we held with them about the research project over the past couple of weeks.

We are also delighted that Dr. Georgios Kavetsos, Research Fellow at the Faculty of Finance at Cass Business School has joined our team. Georgios is an economist and his doctorate previously looked into the impact the London 2012 Olympics announcement had on both the stock and property markets and the effect of hosting the Games on sports participation in Britain. The study we are conducting will have a strong economic and financial focus and having Georgios on the team ensures that we won’t leave any financial stone unturned!

The survey technique we are using at this stage of the CSR and sports sponsorship research project is called a Likert-type scale, named after its inventor, US business psychologist Professor Rensis Likert.

Part of the deliberations about the use of the Likert-type scale centred around the use of “neither agree nor disagree” as a choice for the respondent to a survey statement. There’s a question mark in academic thinking about what this response actually means in most cases – a view that I agree with.

And linked to this was a fascinating debate within our team about the merits of a five or seven point Likert scale!

One academic school of thought suggests that a Likert-type scale that allows for a neutral point makes people gravitate to it. Georgios recommended that we adopted a scale that was 7-point without a mid-point instead of the more regularly used 5-point with a mid point. And this is what we’ve adopted for this study.

And even the positive to negative or negative to positive order of the scale was debated in the early stages of the questionnaire construction, and it was decided to go with ‘Disagree Strongly’ being the lower number, and ‘Agree Strongly’ being the highest number on the sale.

We also decided that these two polar opposite responses would be the only anchor labels in the scale given that the Likert-type scale is supposed to be a continuous scale and so labeling each point is akin to a stepwise gradation and therefore risks distorting the research findings. In this way, respondents aren’t bound by the labels in the middle, and as a result the scale we are using is continuous. So no labels apart from the anchors!

So as you’ve just read, there’s more to ‘agreeing’ and ‘disagreeing’ than may think!

For those who are familiar with my posts, I have pointed out the major football brands, and the key players in football marketing. Most of them are either FIFA sponsors or FIFA partners. The FIFA World Cup sponsors benefit from a tremendous marketing platform to showcase their producs, link their brand image to the biggest football event in the world, promote  online and offline activities, engage with consumers,  and ultimately have an exclusive component as an official sponsor.

The strategy to heavily invest in being a FIFA sponsor could be justified based on the above mentioned advantages. However, a recent survey by The Nielsen Company* showed that Nike was more frequently linked to the World Cup than any of the tournament’s official partners and sponsors. The survey analyzed online blogs, social networking platforms and came to the conclusion that the Swoosh was fully part of the FIFA World Cup landscape, and engraved in consumer’s minds.

With no doubt, the huge online buzz made by the “write the future” campaign strongly contributed to put Nike under the football spotlights. The viral was launched mid-may and had more than 3 million viewers the first week. So far, 14 million viewers enjoyed the video online.  Nike’s biggest stars were featured in the video:  Drogba, Cristiano Ronaldo, Rooney and even Kobe Bryant, Roger Federer and Homer Simpson. Not sure the latter is a Nike athlete though.

HIGHEST SHARE OF ONLINE WORLD CUP BUZZ (Sponsors vs. Competitors)

Source: The Nielsen Company
**Share of online buzz across the 10 sponsors/partners with a global footprint and two of their major competitors in English language messages related to the World Cup from May 7 to June 6.

I pointed out in a previous article, that Nike, adidas, Puma are widely acknowledged as football brands. It seems that not being a FIFA (nor UEFA) sponsor does not stop Nike from succesfully link its brand to the biggest football competition. The “Write the Future” campaign only did not contribute to those facts. It must be added that Nike sponsors 9 teams at World Cup, provides outfit to several players including superstar Cristiano Ronaldo, Wayne Rooney and many others. On top of that, on February 25, the Swoosh launched a powerful campaign “taking ownership” of the sustainable component in football.

This strategy seem to pay off as Nike has managed to leverage its brands, products, activities in football around the World Cup without being a sponsor i.e without paying any sponsorship fees to FIFA.

Let me add one thing. I do remember back in 1994 after the World Cup in the US, a statement from Phil Knight (Co-Founder and CEO of Nike) about football. His goal was to make Nike THE global football brand.  I was a student at that time and was quite doubtful about this objective. To me, Nike was a Basketball brand with Michael Jordan as an icon, period.  I bet I was not the only one. However, one year later, Nike partnered with CBF (The Brazil National Team) then with, players, european clubs etc.

The results and facts speak for themselves, but what is interesting to point out is that this achievement has been done without being a FIFA sponsor or partner. Other brands such as Carlsberg and Pepsi are adopting a similar strategy although the results are not yet to be compared with Nike’s.

Don’t get me wrong, by no means do I say that it is not worth it to be a FIFA sponsor. I think  the contrary. It is key for a brand to associate with FIFA hence World Cup and benefit from all sponsorship components. Nevertheless, I must be pointed out that some brands, and in the present case, Nike managed to create a strong link between their brand and an event they do not sponsor. I would echo Pete Blackshaw (Executive vice president of digital strategy at The Nielsen Company) “If you’re a company with a large global footprint, it’s natural to want to associate yourself with a major worldwide event like the World Cup”

I am a big believer in strong competition. It makes other brands work harder, be more creative, think out of the box, and keep the stimulation flow on. For sure, the other football brands will strike back, and it’s….”for the good of the game” right?

I would be delighted to hear your thoughts.

Karl

*Nielsen’s study, conducted between May 7^th to June 6^th 2010, looked at English language World Cup-related messages on blogs, message boards, groups, video and image sites – including Flickr, YouTube, Facebook, and Twitter – that mentioned at least one of the 10 official FIFA partners and sponsors with a global footprint or two of their top competitors (30 brands in all).

When brands consider sponsorship properties, they aim to maximise external opportunities – increased brand recognition, brand awareness, loyalty, customer numbers and most importantly, sales.  However, during a downturn, when sponsorship budgets are questioned by CEOs and brand marketers alike, the internal benefits to a company of sponsorship activity are often forgotten, leaving work forces bereft of a cohesive brand identity and the motivation that goes with it.

Employee engagement has been the hot topic at recent sponsorship conferences and there couldn’t be a better time for it to come back into the spotlight.  With morale in business at an all time low, while half of UK businesses maintain pay freezes and have put recruitment on hold, some businesses are seeing their sponsorships as opportunities to boost employee engagement and to inspire, enthuse and re-energise staff. 

Why engage your employees?

Engagement is key to competitiveness and innovation.  Motivated employees equate to increased productivity, increased effectiveness and increased retention.  Particularly in consumer-facing brands, the employees reflect the brand and carry that brand image with them in everything they do. This principle applies equally from the top level CEO to the call centre worker – maintaining brand values at every level is crucial.

It’s not the winning; it’s the taking part

A case in point – Olympic sponsors seem slow to capitalise on the obvious benefits and value of such a unique asset.  A massive 85% of organisations have no current plans for utilising the London 2012 Olympic and Paralympics Games to engage staff – shocking results when considering that employee engagement has been a key element to sponsorship activation for many years.  This also demonstrates one of the reasons why 80% of industry experts believe domestic sponsorship of the London 2012 Olympics games does not represent value for money.

Engaged employees perform up to 20 percent better than less engaged employees and are 87 percent less likely to leave the organisation than employees with lower levels of engagement, so it’s certainly worth taking part in this activation method.

Carrying the torch

The Sydney 2000 Games was a significant moment for sponsorship and employee engagement. 

As sponsors of the Sydney 2000 Olympics Games, Westpac developed a stakeholder engagement project that provided more than 5,000 clients, business partners, employees and consumers with the opportunity to experience the Games.  Specifically for their employees, they developed ‘staff values’ programs where staff could nominate colleagues who show values inherent to those of the Olympics.  This included anything from respect and fair play to determination and drive.  The winners were rewarded with tickets to the games.  In total Westpac gave away over 40,000 tickets, a significant proportion of which was allocated to staff.  Furthermore, they successfully aligned the values of the Olympics with their business and staff, resulting in significant return earned on the investment through improved workforce morale and customer service.   

Employee engagement is a top priority for Lloyds TSB who has taken inspiration from Westpac.  As sponsors of the 2012 Olympics and with 68,000 staff, they want to get the most out of the £80m investment.  With a huge internal communications project, Lloyds aim to inspire staff by bringing the values of the Olympics alive and relating them back to the business.  They’re looking for employee participation and support through a calendar of events for staff, and through the launch of online magazines, intranets, giveaways, presentations, and competitions, Lloyds have managed to inspire its staff effectively and have received high-value of return on the investment.  This is reflected by the Lloyds TSB MD that he would have gladly spent the amount invested in the Olympics on the resulting engagement program alone. 

Use your imagination

It’s very tempting for brands to invest a lot of money into an event like the Olympics and only really engage staff through a couple of newsletters and some free tickets, but there is considerable opportunity lost by keeping employees uninvolved in the sponsorship.

Firstly, choosing the right property is important.  How does it fit culturally? What are the opportunities for engagement? Where can broader marketing fit in?  The partnership between British Gas and British Swimming is a fantastic example of this.  Although the project is very consumer focused they communicate the partnership to their employees and engage them in unique ways.  By communicating to employees the aims of the project, which includes supporting future talent and enabling pools to be more sustainable, they are increasing their respect and admiration for their company and making them proud to work for the brand. 

Setting objectives will help keep any employee engagement program on track and will also help with measuring results.  Only once objectives are set should an innovative and creative engagement program be developed to get employees involved. 

Finally, measuring results is paramount.  Employee engagement is easy to measure quantitatively or qualitatively using questionnaires, surveys, performance reviews, sales figures, online feedback and focus groups.  A great example here is BT’s sponsorship of the Olympics.  For them employee engagement is key.  Through consistent objective setting and feedback sessions, they have created unique projects, including athletes engaging with staff to help motivate and inspire them. Such benefits filter down to staff at lower levels, and make sure there is a consistent amount of productivity rather than strong spikes and dips. 

Sponsorship can be used to motivate, inspire and encourage. When property is linked harmoniously to a company’s vision and communicated to staff properly, employee engagement is maximised to it’s greatest effect.

Whether it’s a B2B brand pushing to increase customer loyalty, showcase their capabilities and build stronger relationships with their clients, or a B2C brand aiming to reach a mass audience and develop connections with customers, employee engagement must play an important part in any strategy.  They are the guardians of your brand – if you inspire their participation, your business cannot fail to be enriched.

On Tuesday night (8 June 2010) I attended “The London 2012 Brand – The Do’s and Don’ts for Business”, organised by London Business Network, which is made up of London First, CBI, London Chamber of Commerce, FSB and the LDA.

The speakers were Mike Mulvey, CEO, London Business Network, Neil Walker, Community Relations Manager, LOCOG and Alex Kelham, Manager – Brand Protection, LOCOG.

Despite the title of the conference – and the attendance of over 400 people with a waiting list on top – it was a shambles in many respects.
The issue of “Do’s” simply wasn’t addressed. Simply telling an audience of diverse businesses to apply for contracts via Compete For isn’t actually the point as less than half a percent of the whole of London’s millions of businesses would actually benefit from such contracts.

Typically, LOCOG focused on the restrictive legislation on the use of official trade marks as proscribed under the Olympic Symbol etc. (Protection) Act 1995 (OSPA) that protects the Olympic and Paralympic symbols, mottos and various words and the London Olympic Games and Paralympic Games Act 2006 (the ‘2006 Act’).

This prevents the creation of an unauthorised association between people, goods or services and London 2012.

There was no sign of LOCOG looking to help the wider business community celebrate the Olympic Games in the UK while the world watches (3 billion via the TV set) – providing a “once in a lifetime opportunity” for business of all shapes and sizes to show the world that we truly are GREAT Britain.

I couldn’t sit there and not say anything.

I mentioned that it was depressing for the audience not to be told what they could do, rather than what they couldn’t do.

To my amazement, the entuire audience broke into a round of applause!

Surely it makes sense that as a country and as communities we come together. I know full well what the rights are of the sponsors – but surely there could be a bundle of rights ring fenced for use by ordinary businesses that could unite the country – not just rich sponsors?

LOCOG’s response was typical – some of the audience could become a sponsor (!!), could compete for contracts, could become licensees, could support athletes and could buy a ticket to the Games!

One person in the audience said that they had supported athletes for the Paralympic Games – and were told they weren’t allowed to mention London 2012 in the PR!

I also mentioned that there was a ticking time bomb with the use of contracted out security to enforce these brand protection regulations that would make the headlines all over the world on TV, radio, print and the internet.

I totally understand the sanctity of protecting intellectual property –in fact my own book, Essential Law for Marketers, is the leading work on the subject and I have written extensively about the Olympic Games over the last 10 years.

To use such a blunt instrument as the current Olympic legislation to snuff out any prospect of the business community coming together is senseless as all it will do is generate ambush marketing activities and infringement of Olympic trademarks – as businesses aren’t offered any sensible options for celebrating what will be something of national pride for all of us in the UK.

During the FIFA World Cup, fans will be able to wave the flag of St George and businesses can also join in the fun.

So what will businesses use who are not sponsors or licensees of official Olympic merchandise?

They are unlikely to want to keep quiet. If you run leisure, restaurant, travel or any other type of services business – or for that matter sell ice cream for a living – London 2012 is a marketing opportunity on your doorstep in London.

Movement for Change

There needs to be a movement for changing this situation – and I invite all readers of this blog to join with me and make this happen.

I propose that a working party of like minded professionals from the worlds of marketing and business join forces. The title of the group could be “London Open for Business”.

A creative idea

At the core of the approach should be the creation of a new brand, which I have called “Celebrate”. The idea will be to get LOCOG to say that “Celebrate is supported by London 2012”. Of course this isn’t a given and there will undoubtedly be resistance – but bear with me…

The IP rights will need to be clearly identified and tight rules will be placed on any business wanting to use the “Celebrate” mark on their products and services. The benefit of a separate and distinctive piece of IP is it would NOT infringe the rights of official London 2012 sponsors.

Yes, the detail of the marketing needs to be thrashed out – but unlike the LOCOG IP, this trademark will be FREE OF CHARGE for the use on approved products and services over a defined period of time. For example, fags and booze would be excluded.

Subject to the basket of rights on offer, enhanced rights could be acquired provided that licensees were prepared to donate say 5% of the sales revenue to a special fund that will support the development of sport for disabled athletes post-London 2012.

We have some remarkable people in our industry, people like Wally Olins CBE and others who I know well who could give their time for free to help businesses in London by creating such a brand.

Who knows, it could have a longer run than the current London 2012 logo…

I want to hear from you, so please get in touch and let’s make this happen for London.

GUEST POST:  The winter ends and the London Marathon comes around very quickly. If you’re a runner, you probably started to worry as soon as the turkey sandwiches ran out about getting into your training plan, if not well before. But even if you’re not a runner, the sponsorship requests and links to newly created ‘Just Giving’ websites soon come thick and fast…

I love to run and race in all sorts of distance events, and I’m also trying out a triathlon in a month or so, but fundraising with a specific charity this year and have entered all the races off my own back. In talking to the fundraisers at the charity I support I have found out about the problems faced by third sector organisations wanting to raise money by offering race slots to those willing to ‘go the distance’. If a space in a big race such as London is purchased by a charity and then given to a runner on a promise of raising sponsorship amounts well into the £000′s in many cases, there can be big issues further down the track. What if the sponsorship targets are not reached? Who carries the cost? Why, it’s the charity, of course. And for some organisations this burden is just to much of a risk.

I also feel a bit jaded by the fact that I cannot get a place in a race without the huge burden of fundraising. Don’t get me wrong – I do not think fundraising through this kind of event is a bad thing at all, but the pressure of training is tough enough on its own in some cases. There are races where sponsorship is not required in the UK, and many bigger ones overseas, but the best and biggest all have pretty hefty hurdles to overcome in terms of entry.

There is also nagging in the back of mind the issue of what happens to the money that organisations who put on these races make. As private organisations its clear that they will always try to make a profit, but how much of it goes into the event planned for the following year? Does any of it go into the sport at the grass roots level? How much of it is used to pay the massive appearance fees needed to get the superstar elite field to show up? Is a place in a road race with a free t-shirt justification for fees alone that can be real bank balance-stretchers?

What do you think of this situation in the UK? How can it be improved for the charities and the runners, or has the popularity of the sport become its own worst enemy?

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Hello all,

Now the Champions League is over and crowned José Mourinho as the best coach in the world, many important questions will arise such as “How many Inter players will he bring along to Real Madrid”, “How many Statues will be erected for him in Milan” etc etc.  As you know, I am not concerned about these unsignificant football questions and am essentially focusing on football marketing areas. Today I made an interesting exercise that I want to share with you. I started by wondering which team sponsor has the most victories in Champions League.

As I mentioned in a previous article, there are 3 major football brands: adidas, Nike and Puma. A SPORT+MARKT survey also outlined this fact. I therefore wanted to find out how team sponsors rank in Champions League victories. Long story short, I put this chart together.

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