Why You Should Ambush ‘Ambush Marketing’

As we approach the 2012 London Olympics we are reminded of the cautions of ambush marketing.  As the event draws near and excitement builds it seems that everyone wants to get in on the action. But be careful about getting too excited and showing your brand’s support of the movement. Unless you are an official sponsor of the Olympic games, any advertising that associates your brand with the Olympics will likely be considered “ambush marketing”.  And, there  are significant legal (and PR) risks at stake. The broad scope of protections and the Olympic bodies aggressive approach to protecting sponsors’ investment makes unofficial association a potential minefield for business.

Ambush marketing (or guerilla marketing) is generally defined as marketing and promotional activities that seek an association with a sponsored event (whether by the use of the name, trade-marks, logos, words, or other indicia associated with the event) without the authorization of the event organizer and without paying the requisite sponsorship fee. The goal of ambush marketing is to misappropriate or capitalize on the goodwill and popularity of the event by associating the brand with the event (or even misleading people to believe that the brand is an official sponsor) in hopes of increasing brand awareness and/or product sales. As a result, the value and quality of the sponsorship for official sponsors is undermined and future sponsorship thereby placed in jeopardy. Accordingly, event organizers are highly protective of the sponsors’ rights and take aggressive steps to prevent third parties from undertaking unauthorized activities that damage their ability to effect high value sponsorships. Event organizers have been known to establish exclusive marketing zones surrounding venues and empower ‘ambush police’ with authority take protective action. Recall the Bavaria girls stunt at the Holland v Denmark game at the 2010 World Cup in South Africa which landed the girls in hot water including two arrests.  Some jurisdictions have even implemented specific laws prohibiting such practices.

While ambush marketing can happen at all levels, it is most prevalent in association with events that reach large audiences, are highly popular and have long established brand awareness and good will. Nowhere is this more prevalent than the Olympics, where sponsors pay significant fees for broadcast and official sponsorship rights. For example, a CTV-Rogers consortium paid a record $90 million in rights fees to broadcast the 2012 Winter Olympics from Vancouver and another $63 million for the 2012 London Olympics. [See below for an update on the 2014/2016 Bell Media-CBC bid] British Airways has reportedly paid  £40 million for a tier one sponsorship of the London Games, which has already brought in more than £700 million in sponsorship and exclusivity deals.

In exchange for granting the exclusive rights to sponsors to advertise their products and services in connection with the games, the Olympic bodies aggressively pursue infringing activity including launching negative PR campaigns and taking legal action. Lululemon was accused of being unpatriotic when it launched a wintry line of clothing in honour of a “Cool Sporting Event That Takes Place in British Columbia Between 2009 and 2011”.   The Olympic bodies have developed a significant international trade-mark portfolio and related rights. Up until the 2010 Olympics, ambush marketing was not specifically regulated in Canada. The legal remedies were limited to violations of intellectual property rights (i.e., trade-mark and copyright infringement, as well as passing off) and claims of false and misleading advertising under the Competition Act as well as claims for interference with economic relations. As a precursor to the 2010 Olympics Canada introduced The Olympic and Paralympic Marks Act which restricted the type of promotion and advertising that could be done during the prescribed period. Collectively, these and similar laws around the world enable the Olympic bodies to protect the value of the Olympic brand and exclusivity/value of sponsorship. The concern with ambush marketing is that often brands don’t even know they’re doing it whether due to naivety or because the scope of protection is increasingly broadening. For example, there is a wide range of trade-marks (e.g., the 5 rings), copyrights, words (“games”, “medals”), expressions (“London 2012”), logos, names (e.g., “Summer Olympics”) and other indicia that may not be used in advertising unless a brand is an authorized sponsor and has paid for such usage rights. In addition, as all advertising will be evaluated considering the entire context of the advertisement and its general impression, unless you have paid for the rights, caution should be exerted when using any words, images or designs that, whether protected or not, may convey an association, direct or implied, with the Olympics. Unfortunately, the desire to show support for the games came catch uninformed advertisers off guard and result in costly and embarrassing ramifications.

The bottom line: Use caution! Don’t link your brand or product to the games in any way unless you’ve paid for the rigtht to do so. We have it on good authority that the London Organising Committee of the Olympic Games is taking a zero tolerance approach to ambushing. This will help to protect your brand as well as the integrity and value of the Olympic brand protecting the future ability of the games to secure the sponsorship it needs to support the event.

Update: As the digital age continues to change the advertising and broadcasting landscape we may see broadcast sponsorship fee values declining. In fact, Bell Media and the CBC recently pulled out of negotiations for the Canadian media rights to the 2014 Winter (Sochi) and 2016 Summer (Rio de Janeiro) Olympic Games. The IOC rejected the united low-ball bid resulting in the broadcasters dissolving their bid partnership to regroup. Speculation regarding the impasse is that the value of Olympic broadcast rights is difficult to quantify in light of media fragmentation and the ability (or lack thereof) to measure the multi-platform audiences of the online and digital media space.

Media and Entertainment Group

About Media and Entertainment Group

The media and entertainment industries are constantly evolving. We know these diverse industries encompass many unique business areas. With the continuing change in the way that content is delivered and viewed, media and entertainment companies require leading-edge advice in many areas of the law—often in multiple jurisdictions.

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