After the party: Olympics ROI- Pippa Collett

October 29, 2012

Last week we learned that not only were the Olympic and Paralympic Games ticket sales partially responsible for returning the British economy to growth in Q3 but that they also came in nearly £400m under budget. We will have to wait to discover whether the feelgood factor that was so much in evidence over the summer can be sustained in the cold light of a dreary UK winter, but what of LOCOG’s sponsors – have they also experienced a positive return from their Games investment? Below is a sample of feedback from ten sponsors on whether their Olympics investment had legs/blades.

Dow, which signed for 10 years as a TOP sponsor in 2011, has said that this deal was predicated on earning at least $1 billion in sales to the 2014, 2016, 2018 and 2020 Winter and Summer Games organisers. It used London 2012 to seed that process in a number of ways:

• Developing a PVC-free plastic for the stadium wrap that it hopes will appeal to future Games sustainability tzars.

• Showcasing several other products in its portfolio, already in use in insulation, roofing materials, water pipes and even in the hockey pitches’ blue surface, enabled by the sponsorship to be marketed under a Games banner.

• Adding a hospitality strand to engage with future Games organizers

• Concentrating its marketing investment in London, Russia and Brazil to raise brand awareness.

• Explaining the facts behind its ownership of Union Carbide, responsible for the Bophal chemical disaster in 1984, which it bought 11 years ago, effectively diffusing the story for the future.

Like Dow, Cadbury, a national sponsor, also came in for criticism as a Games partner. However, Cadbury was looking less for an immediate bottom line impact. It wanted to use the Games as a catalyst for change across its business, particularly in the field of digital marketing.

Through its Spots v. Stripes marketing campaign it was the first company in the UK to use the mobile app Shazam to extend its TV commercials and the first in the world to use on-pack virtual reality. From 550 events countrywide initiating dialogue to introducing gaming, Cadbury is now the UK’s biggest brand on Facebook and the world’s biggest brand on Google +, engaging over 22 million people in its Games marketing activity.

London 2012 resulted in a broad-based legacy of marketing assets that can be used across Kraft brands into the future. It also changed its marketing paradigm from having activity spikes across the year to an “always on” approach to have a constant dialogue with customers.

Long-standing TOP sponsor, Visa, was delighted with Visa card usage throughout the Games. Its undisputed aim is to extend its brand franchise to directly benefit account holders worldwide by ensuring a safe, convenient and reliable payment experience for those traveling to the Games. Not only were tickets only purchasable with a Visa product, over 3,000 contactless terminals were installed across Olympic Games venues that accepted prepaid cards, mobile technologies and other payment innovations.

An estimated $1.6 billion was transacted via the Visa network over the course of the Games, spread across a wide range of categories including shoe repairs, spa treatments, theatre tickets, retailers and airlines. US cardholders were the biggest spenders, followed by Japan, France, Italy and Australia.

‘Take the Stage’ was the biggest every UK marketing campaign for German based Adidas. This generated sales of Games merchandise of at least £100m, ensuring the sports-related manufacturer at a minimum breaks even on its sponsorship investment.  Building on other investments in football, Adidas anticipates its full year performance will be particularly strong, with rivals Nike and Puma seeing business slow in the Europe.

London 2012 was “the largest and most ambitious campaign that we have ever done and it’s one of the highest returns on investment campaigns” according to Proctor & Gambles’ Marc Pritchard, leader of the company’s global brand team.  A national sponsor in Vancouver in 2010, P&G then signed up to the TOP sponsorship programme for a 10 year term.

P&G sees the Olympics as a vehicle for reaching more women that for most other sports events.  It leveraged the London 2012 opportunity through a campaign that highlights the role played by mothers in nurturing sporting talent. The ‘Thank You Mom’ campaign, criticized for outdated stereotypes, was expected to generate at least $500 million during 2012 in incremental sales.

As the longest-serving Games sponsor Coca-Cola has its ROI model fine-tuned. Previous Games have featured its core brands but, following its Euro 2010-related market share gains where 30 of its 70 markets saw a business benefit, London 2012 will see Powerade and Vitaminwater added to the product marketing mix.