Nike is in discussions with the International Olympic Committee to forge a broad relationship that could make the sports brand a major advertiser during the Sydney Summer Games in 2000.
One executive familiar with the talks said Nike could become an official Olympic sponsor. But before that happens, the marketer wants assurances it could use Olympic athletes--such as sprinter and Nike-endorser Michael Johnson--in commercials shown during the Games. IOC rules forbid the use of Olympic athletes in commercials shown during the Games unless a waiver is granted.
A Nike executive, while acknowledging the talks with the IOC, said it was unclear how extensive an alliance will be formed.
'A BROADER RELATIONSHIP'
"I know there have been discussions with the IOC about a broader relationship, but it won't be anything as formal as an Olympic sponsorship," said Martha Benson, Nike's coordinator of Olympic efforts-international marketing.
The talks come as the IOC is trying to rebound from a scandal-laden winter and reassure marketers the Games themselves are not tarnished. Nike, too, is struggling with its image.
Nike last week reported a surprising increase in third-quarter net income, rising 70% to $124.2 million from the year-earlier period. Income rose largely due to cost-cutting, the company said, in also noting that slower sales in Asia and Latin America contributed to a 2% drop in revenue, which fell to $2.18 billion for the quarter.
Company Chairman-CEO Phil Knight, in talking about that mixed news, said though there are a lot of "positive signs," Nike is by no means "entirely clear what the future holds for us."
EARLIER SPOTS DREW IOC IRE
The last time Nike was involved in the Summer Games, in Atlanta, the marketer drew the ire of the IOC for running TV spots from Wieden & Kennedy, Portland, Ore., that included taglines such as "You don't win Silver, you lose Gold." Some IOC members considered the spots contrary to the spirit of the Games.
In 1996, Nike was an "ambush" marketer; Reebok International, which has taken a pass on Sydney, was the official Olympic sponsor.
The Games in Sydney should have their share of ambush advertisers. AT&T Corp. and Coca-Cola Co., official Olympic sponsors that have committed to major ad purchases on NBC, have passed on buying Olympics packages on the network's owned-and-operated TV stations, according to some NBC general managers. NBC is shopping local packages to other advertisers.
NBC has 13 stations, including six in the top eight U.S. markets.
"We have a deal on the table with another company in the soda-pop category for nine stations," said one of the general managers.
The marketer is said to be either Pepsi-Cola Co. or Cadbury Schweppes. Executives at Cadbury, however, said they were unaware of any talks and such a deal would be unlikely. A Pepsi spokesman said he was unaware of such talks.
11TH-HOUR DEAL POSSIBLE
The station general manager said an 11th-hour deal with Coca-Cola is possible. Executives at Coke with knowledge of the situation could not be reached.
In place of AT&T, NBC is speaking to other phone companies about TV packages on the O&Os. "We're going to have a big presence during the Games, so being ambushed is not a prime concern," said Mike Neavill, AT&T's director of media services.
Contributing: Wayne Friedman, Louise Kramer.
Copyright March 1999, Crain Communications Inc.