McCann forms Olympics shop

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Interpublic Group of Cos.' McCann-Erickson WorldGroup has created a dedicated agency for Olympic marketing, with plans to open an office in the great, untapped market of China.

The newly formed O5 Group has offices in New York, Detroit and beginning early 2003, Beijing, site of the 2008 Olympic Summer Games. O5 will also open offices later this year in Athens, Greece, host of the 2004 Summer Games, and Milan, Italy, near the city of Turin, site of the 2006 Winter Games.

BIG GUNS

The agency's core business is Olympic consulting, contract negotiation and sponsorships. O5 serves as an independent entity within McCann. Though it plans to seek its own clients, two of the Olympics' biggest sponsors are already two of McCann-Erickson Worldwide's biggest accounts-Coca-Cola Co. and General Motors Corp. Coca-Cola is one of 10 Olympic Partners who spend more than $100 million for global marketing rights. GM is one of six Olympic Properties of the U.S. partners who spend $50 million for U.S. marketing rights.

O5 Managing Directors Gary Pluchino and Bob Huessner said they will seek clients from all marketing categories and are free to take on any client that does not pose a conflict with Interpublic clients. Interpublic and McCann clients are not obligated to work with O5.

Still, the goal is clear: Use the next six years to lure as many companies as possible to the Interpublic stable in preparation for the Beijing Olympics, which many marketers are hoping will be the flash point that opens the communist nation of more than a billion to greater opportunities.

"China," said one Interpublic executive, "is the carrot. Beijing looms as a monumental marketing spot."

O5 is believed to be the first time an agency was established to be dedicated solely to Olympic sponsorship and marketing. O5 is so named for the five Olympic rings and the five McCann WorldGroup properties from where it draws its 14-person staff: McCann-Erickson (advertising), Momentum (event promotion), Weber Shandwick (public relations), FutureBrand (brand identity) and MRM Partners (direct marketing). O5 was formed in early April.

"The real catalyst was when the Games were awarded to Beijing last July," Mr. Heussner said. "There isn't a multinational marketer out there that doesn't have its eyes on China. McCann WorldGroup has many clients to whom China is and will be very important."

Each of the 14 staff members has Olympic marketing experience, particularly the two managing directors. Mr. Pluchino previously worked for ISL Marketing, Switzerland, which is the exclusive worldwide marketing agent for the International Olympic Committee.

Mr. Huessner was head of the Olympic consulting division for Interpublic's Octagon for 10 years. They report to Momentum CEO Harlan Stone.

"This indicates a big vote of confidence in the Olympic brand on the part of [McCann]," Mr. Pluchino said. "They made a sizeable investment in O5," he added, declining to quantify the investment.

chinese presence

Coca-Cola already has a presence in China, as does General Motors, where it has a 50-50 partnership with Shanghai Automotive Industry Corporation in Shanghai GM. General Motors is also the exclusive automotive sponsor for the Chinese Olympic Committee delegation through the 2004 Athens Games.

"I would say that while both Coke and GM have a presence in China, they haven't even scratched the surface," Mr. Pluchino said. Coca-Cola and GM did not return phone calls for comment.

Although client conflict would seemingly be a prohibitive factor in gaining new business, several sports marketing experts said large marketers that already spread work among various agencies and holding companies shouldn't have a problem in directing some Olympic business to O5.

"Initially, they'll have a tough time getting new accounts," said David Carter, president, Sports Business Group, Los Angeles. "But these big companies need to realize that marketing sports on an international level brings unbelievable nuances like cultural differences and political challenges. Fundamentally, the one-stop shop concept is wise, particularly when you're trying to penetrate a market such as China. ... With a single representative ensuring that those things are in place, you stand a much better chance of successfully penetrating the last great market."

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