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Official Report of the XXVII Olympiad

Operations and Services : Sponsorship and Marketing : Page 1.

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SPONSORSHIP AND MARKETING

SOCOG’s sponsorship, licensing and marketing functions sat within the Commercial and Marketing Group. While naming of the Programs performing these tasks underwent changes and growth during SOCOG’s existence, its global sponsorship, licensing and marketing goals remained the same – strategic and effective marketing of the Olympic Games brands and achieving revenue forecasts in the areas of sponsorship, fundraising, licensing, merchandising and other marketing opportunities.

Sponsorship

The Sponsorship Sales and Sponsorship Servicing Programs were responsible for the delivery of corporate sponsorship that provided 40 per cent of SOCOG’s net revenue. The two Programs were at first integrated but were separated late in 1998 to allow specialists to focus on securing the remainder of sponsorship revenue.

The Sponsorship Sales Program’s core task was to raise revenue through the sale of intellectual property rights, accommodation, tickets and hospitality in exchange for sponsor cash, products and services. The Sponsor Servicing Program helped sponsors gain the full potential of their investment by ensuring SOCOG program areas were meeting sponsors’ requirements.

Early Planning and Agreements

In 1994, SOCOG commenced work on its draft marketing plan for the Games, which was submitted to the IOC in June 1995. It delineated sponsorship into two streams – those that the IOC was still exploring globally and those categories that SOCOG was free to explore locally.

An important sponsorship initiative was the SOCOG-Australian Olympic Committee (AOC) Joint Marketing Agreement, covering the period 1 January 1997 to 31 December 2000. It established the approval process for marketing and guaranteed AOC’s existing sponsor agreements, as well as its anticipated value-in-kind (VIK) needs. This agreement gave Australian Olympic Team marketing rights to SOCOG in return for payment to the AOC of $60 million.

Sponsorship Sales

Sponsorship identified eight key industry cluster groups to be targeted:

  • food and beverage
  • financial and professional services
  • technology and telecommunications
  • transportation and travel services
  • consumer durables
  • natural resources
  • uniforms and sports equipment
  • media.

The Program calculated revenue objectives for each cluster. These projections were achieved through understanding of the Australian marketplace, evidence of sponsorship sales results at previous Games and the analysis of category dynamics such as size, number of players, revenue, employees, marketing spend and key strategic issues. The table below shows the level of effort required to obtain sponsorships.

Sponsor Research and Signings


Number of sponsors signed - 113 as at 1/9/00
Number of companies researched and approached - 1500
Number of categories researched - 211

The initial sales period for sponsorship, in late 1996 and through 1997/98, delivered excellent results in the major categories. This success caused other parts of SOCOG to raise their expectations regarding potential sponsorship, and revenue budgets were increased without sufficient research into what the market would bear, or the constraints of current TOP sponsorships.

While there were several subsequent revenue target upgrades, the main increase occurred early in the process (1996/97) and was a result of more accurate scoping of the Olympic overlay and funding of a $100 million payment to the AOC in return for surrendering its entitlement to 90 per cent of the Games profit.

Advertising and the Olympic Games have become inseparable. Huge billboards and posters promoting Olympic partners were placed all over the city - GRAHAME EDWARDS/CITY OF SYDNEY ARCHIVES

1. Advertising and the Olympic Games have become inseparable. Huge billboards and posters promoting Olympic partners were placed all over the city - GRAHAME EDWARDS/CITY OF SYDNEY ARCHIVES

Taraflex, an Olympic sports equipment provider was signed on to provide playing surfaces for badminton, handball, table tennis and volleyball in exchange for marketing rights - ADAM PRETTY/ALLSPORT

2. Taraflex, an Olympic sports equipment provider was signed on to provide playing surfaces for badminton, handball, table tennis and volleyball in exchange for marketing rights - ADAM PRETTY/ALLSPORT

Marketing the Olympic Games and attracting sponsors was a main responsibility of SOCOG’s head of marketing, John Moore, and his team - SOCOG

3. Marketing the Olympic Games and attracting sponsors was a main responsibility of SOCOG’s head of marketing, John Moore, and his team - SOCOG


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