With the Sochi Olympics well underway, major sponsors/advertisers are getting way more than they what they expected with this year’s games. It’s noted that advertisers are spending more than $900 million during these Winter Olympics. This despite all the issues being decided outside the traditional figure skating, snow-boarding or kurling events.
Leading up to opening ceremonies there were several issues playing out as a backdrop to the games. Security issues, corruption, cost of the build-out, government relations, and anti-gay laws. Despite these threats, advertisers didn’t back down from producing billion-dollar ads. In fact, some advertisers saw these issues playing out during the Olympics as a plus to gaining more viewership for their campaigns.
Not surprising, social media is also playing a major role in this year’s games (which is totally expected). This year, more than ever before, advertisers like Coke, Visa and McDonalds are spending just as much, if not more money and man hours monitoring and engaging consumers through social media. What these major advertisers didn’t expect were the reactions via social media around Russia’s controversial anti-gay issues. Well thought out social media strategies are being hijacked by consumers calling for others to ban these brands due to their support of the Winter Olympics.
From a sponsorship angle the games are an expensive proposition. But exclusivity does have it privileges. To have every ATM Visa only, to provide thousands of phones to athletes to take pictures with during opening and closing ceremonies, is a huge brand play. Despite the large dollars, only 40 percent of sponsorship revenue goes into putting on the Olympics. This will obviously be lower this year seeing that these Winter Olympics have set an all-time high to be produced.
So, to advertisers, it’s much more than a medal count, it’s an expenditure that can make or break how your brand is perceived both in the U.S. and Internationally.