Record $869 Million in Sponsorship for Salt Lake City Games

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NEW YORK (AdAge.com) -- Despite the events of Sept. 11 and a still-frigid economy, it appears marketers believe the Feb. 8-24 Olympic Winter Games in Salt Lake City remain a good investment.

This year's games, the first hosted by a U.S. city since the 1996 Summer Games, have attracted a record $869 million in sponsorships. NBC also says it's 92% sold out for the broadcast.

Since the decision was made in the early 1990s to alternate Winter and Summer Olympics on a biennial basis, advertisers and marketers must decide whether to gear up campaigns every two years instead of every four.

"That's a question examined every year, by every management, and we still go on," said Steve Block, vice president of media sponsorships for AT&T Corp. "This year, you just have to work harder than you ever have before on making the investment pay out."

Slow summer for sales
As recently as July -- before the terrorist attack -- Olympics sales were slow.

Because of schedule changes made in the National Football League after the Sept. 11 attacks, the Super Bowl on News Corp.'s Fox was pushed back a week to Feb. 3. Opening ceremonies for the Olympics are five days later, and marketers such as Visa USA and Monster.com plan to advertise on both.

"The moment is very right," said Richard Notarianni, media director for Omnicom Group's DDB Worldwide, New York. "You think historically there are times when sort of the nationalist side of the Olympics re-emerges. It hadn't been that way for a while. It was sort of out of vogue to play on that. You can argue now that the tone of the country has definitely turned toward a nationalistic moment."

NBC has sold 92% of its Olympic ad time, spokesman Kevin Sullivan said last week. NBC has Olympic broadcasting rights through 2008.

$600,000 spot
A prime-time 30-second spot on the Olympics is estimated to cost $600,000, according to industry executives. The average Super Bowl spot, by comparison, is expected to sell for below $2 million; the most costly series for advertising this season, CBS's Survivor: Africa, carried an estimated price tag of $445,000 for a 30-second spot.

The Salt Lake City Olympic Committee appears to have overcome the bribery scandal of two years ago. The 2002 Winter Games, according to the U.S. Olympic Committee, will have 65 sponsors laying out a total of $869 million, a whopping figure compared with the $480 million spent for the 1996 Atlanta games, the $212 million for Nagano, Japan, in 1998 and the $350 million last year in Sydney.

Partners can buy different levels of sponsorship. The Olympic Partners -- eight marketers including Coca-Cola Co., McDonald's Corp. and Visa USA -- is the most costly. These sponsors, who according to sports-marketing experts paid upward of $100 million for rights through at least 2004, have global Olympic marketing rights.

Olympic Properties of the United States Partners -- Anheuser-Busch Cos.' Budweiser, ATT Corp., Bank of America Corp., General Motors Corp., ChevronTexaco's Texaco and Qwest Communications' US West -- pay up to $50 million per Games for domestic marketing rights. OPUS Sponsors contribute in the $25 million to $40 million range the 11 sponsors include Delta Air Lines, Home Depot and Monster.com. OPUS Suppliers, such as Sears, Roebuck & Co. and Marriott International, provide goods and services valued from $5 million to $20 million. The final two tiers include licensees and individual and business donors.

Ad spending on NBC is in addition to those sponsorship figures. Most sponsors are buying time. Rival marketers who are not sponsors are free to buy time, but NBC must first offer it to an Olympic sponsor.

AT&T will break a campaign that addresses each of its four constituent parts: business, consumer, broadband and wireless, Mr. Block said. The Olympics will be the first time the ad community will see significant new work from WPP Group's Ogilvy & Mather Worldwide, New York, for its new client, AT&T Wireless, he said.

Visa USA launched a campaign last week with the first of three commercials produced by Omnicom Group's BBDO Worldwide, New York. McDonald's breaks an effort with two spots, produced by Omnicom's DDB Worldwide, Chicago, on Dec. 21. McDonald's will introduce a chicken parmesan sandwich and a cheddar-bacon-sausage breakfast sandwich during the Olympics.

Interpublic Group of Cos.' Campbell-Ewald, Warren, Mich., has created four Olympic spots tied to Chevrolet trucks and sport-utility vehicles; they make their debut next month. Bank of America broke an Olympic campaign Nov. 19 from Interpublic's Bozell, New York.

"For those who obviously have the financial wherewithal to do it, there can't be a better time to be associated with an event like the Olympics," said Rich Kronengold, chief marketing officer of BBDO, New York. "You go fishing when the fish are there. When your competition is scaling back, this is a time when leading brands can dominate the marketplace. Frankly, I can't imagine a better Olympics to be involved in."

Patriotism toned down
Surprisingly, given the nationalism inspired by Sept. 11 and the fact the Olympics are on U.S. soil for only the second time since 1984 and won't come back here until at least 2010, patriotic fervor has been kept to a minimum.

For instance, Bank of America's TV spots feature bank "associates" haplessly trying Olympic winter sports such as ice hockey and pairs skating, with humorous results. Focus-group participants said humor was more important than ever, said Frank Sottosanti, senior vice president of brand executive.

"We had to really take a step back ... and see if these ads were still appropriate," he said. "Consumers said: 'We kind of need this now.'"

Beer bash
Not everything is rosy heading into the Games, however. Salt Lake Olympic organizers and the International Olympic Committee have had to delicately dance around a planned boycott of Anheuser-Busch by George Van Komen, an anti-alcohol crusader and director of the Alcohol Policy Coalition in Salt Lake City.

With a heavy population of members from the Church of Jesus Christ of Latter-day Saints, Utah is known as a mostly dry state. Not only is Anheuser-Busch an OPUS partner, it also struck a deal with Olympic officials to rent a three-acre plaza in downtown Salt Lake for $500,000, as well as sponsor its "Bud World" exhibition.

Also, more than 800 representatives from the 65 partners attended a sponsorship workshop in Salt Lake City two weeks ago, and security was a big concern.

"It's a live, visible event in the U.S. with some very 'American' companies," said one sponsor vice president. "There's no question you have to address the security issues."

Staff writers Mercedes M. Cardona and David Goetzl contributed to this report.

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