Why Budweiser Backed Out of the Olympics

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Budweiser last year replaced its brand name on certain packaging with 'America.'
Budweiser last year replaced its brand name on certain packaging with 'America.' Credit: Anheuser-Busch

Budweiser - -which rebranded itself "America" last year -- is no longer Team USA's beer. Anheuser Busch InBev has ended its sponsorship of the U.S. Olympic Team after a 32-year run that began with the 1984 Olympics in Los Angeles.

"We continually evaluate our sponsorships as our business priorities evolve and we're adjusting our portfolio to reflect those priorities. We're proud of our long-term partnership with the USOC and all that we have accomplished together on behalf of America's athletes," said Elco van der Noll, AB InBev's VP-experiential marketing, in a statement.

The brewer did not immediately respond to a question about the value of its latest deal. Sports Business Journal -- which first reported the news -- stated that 2016 Rio Games "marked the end of a four-year deal worth a reported $13 million."

Lisa Baird, chief marketing officer for the United States Olympic Committee, confirmed in an email that the deal ended in December "after a long and great partnership." Asked if the USCO had lined up a new beer sponsor, she said: "we'll share any new partner news when the time is right."

A former AB InBev executive told Ad Age that the Olympic sponsorship is not a good fit for the brewer. The winter games do not fall in a "key consumption period" for beer, this person said, and the Olympics come shortly after the Super Bowl, on which the brewer puts a huge marketing bet with multiple pricey ads. While the summer games align better with the summer drinking season, they are not a great fit for beer brands because viewership skews older and more female, the former executive said. Beer brands tend to target young adult males, although some brands have made a concerted effort lately to reach females.

The former AB InBev executive said "you can only support so much and you've got to prioritize." This person noted that the brewer had not really been activating its USOC deal in a huge way. In 2014, for instance, AB InBev declined to buy TV advertising during the Sochi games, drawing complaints from NBC executives.

Sports Business Journal noted that the brewer is "the latest in a string of high-profile partners to not renew with the USOC heading into a complicated Olympics cycle." The publication stated that the "USOC is facing headwinds going into a period in which three consecutive games will be held in east Asia, scaring some sponsors worried about maintaining fan engagement."

Citi -- which began sponsoring the USOC in 2012 -- confirmed in December that it did not renew its deal. Other sponsors that decided against renewing after Rio include Hilton, TD Ameritrade and AT&T, according to Sports Business Journal.

USOC spokesman Jon Mason in an email disagreed with the notion that the USOC was facing headwinds. He pointed to a new deal the International Olympic Committee announced today with Chinese internet giant Alibaba. The pact makes Alibaba the official "cloud services" and "ecommerce platform services" partner of the games in a deal that runs through 2028.

USOC sponsors on board for the 2018 Winter Olympics in Pyeongchang, South Korea include Bridgestone, Comcast, Dick's Sporting Goods, Hershey Co., MilkPEP, Mondelez, Toyota, Mondelez International and Comcast, according to Mr. Mason.

The 2020 Summer Olympics are slated for Tokyo, while the 2022 winter games will be in Beijing.

Mary Scott, president of global integrated communications at United Entertainment Group, a sports and entertainment agency, said "when the games are in a different part of the world it certainly provides a different set of situational elements because of time difference of the games on television." But she added that "the onset of new media and being able to follow in real time in various ways negates that. We've seen markets outside of North and South America have the games before and they been incredibly successful for sponsors."

Only official Olympic sponsors are allowed to use Olympic trademarks in advertising. However, as result of a rule change that took effect for the Rio games, non sponsors can now run ads starring Olympic athletes as long as they don't use a plethora of USOC-protected words, like "Olympic." To qualify, the non sponsor ads starring Olympians must be in market for a period of time before the games.

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