Top-Tier Olympic Sponsors Spend $100 to $400 Million Dollars On the Olympic Games - Is It Worth It?

By Paul Birdwell (paul@roaringforkagency.com)

With the Sochi Winter Olympic Games set to start this week we have been looking over the investments made by the major sponsoring companies of the Olympics and we have found eye-popping numbers everywhere that we have looked.  

SochiOlympic1.jpg

CNNMoney recently asked the very good question of….

Olympic Sponsorship:  Is it worth it?, Virginia Harrison, CNNMoney

….and that is an important question because of the large amounts of money that companies spend to be Olympic sponsors:

“Former International Olympic Committee director Michael Payne said Cobb County was an early example of the kind of media storm the Games can generate, and sponsors had learned to roll with the punches.

Since then, the explosion of social media has given campaigners a new platform to exert pressure on big Olympic sponsors, including Samsung (SSNLF), Panasonic (PCRFF), General Electric (GE, Fortune 500), Dow Chemical (DOW, Fortune 500), Procter & Gamble (PG, Fortune 500), Omega (OCFN) and Atos. (AEXAF)

So does this brand bashing have any impact on their investment?

Corporations pay an estimated $100 million to become a major Olympic sponsor. On top of this, they pump massive investment into related marketing campaigns.

"The rights fee is really on the right to spend more money," said John Ivey, managing partner at Boston-based sports marketing consultancy AMM.

Just how much more isn't clear. Media tracking company The Global Language Monitor estimates top sponsors spend as much as one billion dollars over four years.

IMD business school president Dominique Turpin said for every $1 paid in sponsorship fees, companies must spend an additional $3 to $4 on things like new product launches or advertising campaigns.”

Wow!

$100 Million Dollars paid to the Olympic Games to be an “Olympic Sponsor” and then another $300 to $400 Million Dollars to make that sponsorship payoff which is serious money even for the largest and best known brands in the world which raises the question of what do the Olympic Sponsors get for all that money?

As reported by the great TV ratings website TV by the Numbers those Olympic Sponsors gets lots of eyeballs and lots of exposure during the Olympic Games every two years which are very simply the most watched TV programs in America and around the world.

Check out the below TV ratings numbers from the 2012 London Olympics and other past Olympic Games:

LondonOlympics.jpg

London Olympics on NBC is Most-Watched Television Event in U.S. History, TV by the Numbers

“MOST WATCHED EVENTS IN U.S. TELEVSION HISTORY:

1.    London Olympics – 2012        219.4 million NBC
2.    Beijing Olympics – 2008        215 million    NBC
3.    Atlanta Olympics – 1996        209 million NBC
4.    Lillehammer Olympics – 1994    204 million CBS
5.    Athens Olympics – 2004        203 million    NBC
6.    Seoul Olympics – 1988            194 million    NBC
7.    Barcelona Olympics – 1992        192 million    NBC
8.    Vancouver Olympics – 2010        190 million    NBC
9.    Salt Lake City Olympics – 2002    187 million    NBC
10.    Sydney Olympics – 2000        185 million    NBC

LONDON OLYMPICS IS MOST-WATCHED NON-U.S. SUMMER GAMES IN 36 YEARS:

The London Olympics has averaged 31.1 million viewers in primetime, and a household rating of 17.5, making it the most-watched and highest-rated (tying Seoul 1988) non-U.S. Summer Olympics since the Montreal Olympics in 1976.

The London Olympics average primetime viewership of 31.1 million viewers is 3.4 million more viewers and 12% higher than the Beijing Olympics (27.7 million) 6.5 million more viewers and 26% higher than the Athens Olympics (24.6 million).

Nine nights of the London Olympics have drawn more than 30 million viewers, topping the combined total from the 2008 Beijing Olympics (5) and 2004 Athens Olympics (2).

According to Nielsen live + same day data, the last primetime series to average 30 million viewers was the 2006 season of American Idol.

AVERAGE VIEWERSHIP – NON-U.S. SUMMER OLYMPICS
London Olympics - 2012    31.1 million     NBC
Beijing Olympics - 2008    27.7 million NBC
Barcelona Olympics - 1992    25.9 million NBC
Seoul Olympics - 1988        25.3 million NBC
Athens Olympics - 2004    24.6 million NBC
Sydney Olympics - 2000    21.5 million NBC

The London Olympics 17-night primetime household rating of 17.5/30 ties the 1988 Seoul Olympics as the highest-rated non-U.S. Summer Olympics since Montreal in 1976.

The 17.5/30 is 8% higher than Beijing (16.2/28), and 17% higher than Athens (15.0/26), the last European Summer Olympics.”

Amazing!  Those are just some AMAZING TV ratings numbers that make spending….

$100 to $400 Million Dollars

….to be an Olympic Sponsor look like a very good investment because there is just no other event on Earth where a company can reach so many people that are often very engaged in watching the Olympic Games like nothing else on TV or any media platform for that matter.

The International Olympic Committee puts out a Marketing Report on each Olympic Games and below are the Marketing Reports in .pdf format for the 2010 and 2012 Olympic Games which are well worth your time if you are interested in some more detail on the marketing side of the Olympics:

Vancouver 2010 Olympic Winter Games Marketing Report (.pdf)

London 2012 Olympic Summer Games Marketing Report (.pdf)

From a recent article detailing Panasonic extending their Olympics partnership until 2024…

Panasonic extends top-tier Olympics partnerships until 2024, Sports Sponsorship Insider

….below are the 10 IOC top-tier sponsorship partnership companies through 2016 that are spending that $100 to $400 Million Dollars per Olympic Games to be a major sponsor of the Olympics:

Panasonic
Atos
Coca-Cola
Dow
GE
McDonald’s
Omega
P&G
Samsung
Visa

Sochi 2014 Olympic Games – www.sochi2014.com

NBC Olympics – www.nbcolympics.com

International Olympic Committee – www.olympic.org

If you have any questions about event sponsorship or venue naming rights contact the Roaring Fork Agency at:

info@roaringforkagency.com

San Francisco, California – 415 730 – 4854

Seattle, Washington – 206 940 – 3934

Bend, Oregon – 541 640 – 2221

www.roaringforkagency.com

Twitter - @RoaringForkAgcy