The Games Prevail for Active Firms

The Beijing Olympics have the potential to be among the most controversial in recent memory — but activewear companies are nonetheless diving in as sponsors.

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Protesters in Chicago.

Photo By WWD Staff

The Beijing Olympics have the potential to be among the most controversial in recent memory — but activewear companies are nonetheless diving in as sponsors.

They can’t afford not to — even though linking up with the Games this time around could have its downsides because of human rights issues in the Asian country. More than the typical surge in sales that active companies enjoy from the Games, the 2008 Olympics are key for brands in establishing a foothold in the huge consumer market that China represents.

Although almost every major sports brand dips its foot into the Olympic pool by dressing athletes and advertising, the most visible are Adidas (the official sportswear sponsor of the 2008 Olympic Games) and Nike (which sources estimate is spending about $150 million for marketing associated with the Games).

Almost across the board, active firms are avoiding demonizing the policies of the Chinese government and dodge questions about whether they worry the protests could hurt their sales — universally saying their focus is on the athletes. But consultants speculate all these companies have put someone in charge of handling any potential crisis, and conversations about a possible backlash are certainly occurring.

Will advertisers get less bang for their buck if consumers boycott watching the Games or turn off their TVs during the commercials, as protesters have been urging? Will customers interpret sponsorship, advertising and ties with the Beijing Olympics as tacit endorsements of the Chinese government’s policies on Tibet, Darfur, the environment and freedom of the press? Will shoppers go so far as to boycott the sponsors, the advertisers or even those with ties as simple as dressing the athletes?

“The labels sponsoring individual athletes probably won’t see any backlash, because no one blames the athletes for participating,” said Suzanne Hader, principal at 400twin Luxury Brand Consulting. “But more general advertising sponsors may very well see some backlash. Part will come down to what the messaging behind the creative is about. If they tailor their creative so it’s more about specific athletes and less about bigger trends and themes in Olympic history, that’s probably a safer bet.”

Of course, almost any company dressing athletes is also advertising. But that doesn’t mean this has to be devastating for the active companies, according to Matt Powell, an analyst for the consulting firm SportsONESource Inc.
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