Companies vie for Olympic attention
A passengers passes a sign advertising Adidas, one of the Beijing Olympics major sponsors, in a subway station in Beijing.
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Kai Ryssdal: There's going to be more on the line during the Olympics later this summer than just who's gonna win the most medals. At $20 billion and counting, the facelift Beijing's giving itself to get ready for the Games might the most expensive ever for a host country. Standard and Poors said today it thinks all that spending will be a net plus for the Chinese economy.
For Olympic sponsors, though, the bottom line's not so clear. Companies pay handsomely for the right to use the rings, but unauthorized copycats have made for a marketing muddle as Marketplace's Scott Tong reports now from Beijing.
Scott Tong: Let's play Name that Olympics Sponsor:
Is it Nike, whose billboards in Beijing show Chinese hurdler Liu Xiang, crouched at the starting line?
Is it Adidas, with its own crouching athletes, and posters that say "Impossible is Nothing?"
Or is it the shoemaker claiming "Everything is Possible?" That would be Chinese upstart Li Ning.
The answer: Adidas.
Now, if you didn't get it right, neither did 25-year-old Yang Xiaodan, a self-proclaimed veteran Beijing shopper.
Yang Xiaodan: Last night, I saw a TV ad for a medical product. It's not connected to the Olympics, but it had athletes running, so I immediately thought about the Olympics.
Not good news for sponsors who have ponied up as much as $100 million dollars to use Olympic logos in their ads and to give their own brands global TV exposure during the games.
Marketing consultant David Wolf says rivals pay nothing to the Olympics' organizers, yet use what he calls "ambush marketing" to piggyback on the excitement.
Today, the IOC's partner, the Beijing Organizing Committee, pledged to root out advertisers whose ads misleadingly "suggest association" with the Games.
Chen Feng is with the Beijing committee.
Chen Feng: We will identify cases of infringement and seek out those companies. If they don't stop, we will seek legal actions, including fines, and we will ask the media to expose them.
Even if he succeeds, the rules leave a lot of space for non-sponsors to operate. For instance, Nike sponsors specific athletes, like Liu Xiang, the hurdler. Footwear maker Li Ning outfits Chinese sportscasters, plus the entire Olympic basketball team of Argentina.
All that marketing noise has some companies wondering if Olympics sponsorships are worth it any more.
Marketing consultant David Wolf.
David Wolf: When you have companies like Lenovo, who as IBM before it has been a longtime sponsor of the games, saying "Hey guys, after summer 2008, we're done." You have to understand that the question is already being asked in some circles.
Still, Will Moss of the PR firm Burson Marsteller says if a sponsor's in it for the long haul, Olympic advertising can have a cumulative effect.
Will Moss: If working with the Olympics helps to feed into people's perceptions of the brand and whether they think it's cool or whether they think it's desirable or not, then the sponsor is getting something positive, even if those associations are sometimes subconscious.
At the conscious level, that theory's in question. In one poll, the timeless Pepsi versus Coke battle came into play. 60 percent of respondents assumed Pepsi was the sponsor.
They were wrong.
In Beijing, I'm Scott Tong for Marketplace.