August 18th, 2008

Study Slams IOC Sponsorship Policies

By Steve McClellan
AdWeek

The groups argue that the marketing of junk foods, sodas, fast-food chains and alcoholic beverages should be eliminated

Ads running on NBC’s coverage of the Beijing Games tout Coca-Cola’s 80-year association with the Olympics. McDonald’s ads say it has been an Olympic sponsor for 40 years. But if public interest group Commercial Alert had its way, both companies, among others, including Anheuser-Busch, one of three beer sponsors at this year’s Games, would be barred from all marketing ties to the Olympics.

Washington D.C.-based Commercial Alert teamed with Multinational Monitor, which tracks the activities of big corporations, on a new study called “The Commercial Games.” The study is highly critical of the sponsorship and advertising policies of the International Olympic Committee and the various sports federations and national committees under its auspices.

The groups argue that the marketing of junk foods, sodas, fast-food chains and alcoholic beverages should be eliminated from the Games. Their reasoning: such products conflict with the stated purpose of the Olympics, which they say is to “celebrate healthful living.” Promoting such products in the widely watched Olympics, the study says, is “unhealthful,” and particularly inappropriate “for an event with enormous appeal to children.”

Others took issue with the report, including McDonald’s, which objected to the study’s labeling of its product as “unhealthy.” A rep said the company had gone to great lengths over the last five or six years to offer balanced meals that include fruits and vegetables and other healthy edibles. He also said sponsorship deals like McDonald’s help make the Games possible (along, of course, with lucrative TV rights deals).

Brand consultant Robert Passikoff, CEO of New York-based Brandkeys, agreed with one assertion in the report: that the Games, with a total of 63 “official” sponsors, are probably over-commercialized. That said, he added: “The question is why should they cut back? They’re making an awful lot of money on it. Why should anyone other than the consumers and the marketing folks be the arbiter of what’s right and wrong? No research group should have the right to tell them who to do business with; who put them in charge?”

It is true that the Olympics attracts a huge audience of both adults and children. Nielsen ratings for the first five days of coverage showed an average audience of 31.3 million total viewers. Last Tuesday, about 1.3 million kids aged 6 to 11 tuned in to NBC’s prime-time coverage, according to Nielsen estimates.

The study, released Aug. 6, also chastises the IOC for what the groups believe is its lack of concern that some companies with marketing ties to the Games rely on so-called “sweatshops” that offer substandard wages and working conditions to produce goods. It specifically cited Nike and Adidas as companies that haven’t taken effective steps to eliminate sweatshop conditions within their supply chains. Nike and Adidas did not immediately return calls seeking comment.

The study also criticizes the IOC for awarding “monopolies” to sponsors such as Visa and Coke that limit spectator choices at the Games themselves. Only non-alcoholic beverages marketed by Coca-Cola are available at the Olympics, and Visa is the only credit card accepted there.

The study characterizes Coca-Cola and McDonald’s as companies that “run businesses centered around unhealthy food.” Each company paid about $70 million for its current sponsorship rights, the study estimates. Arguing that both agreements are inappropriate, it concludes, “Junk foods contribute to obesity, a major public health problem not just in the United States but in many countries around the world including China. . . . The Olympics should not lend its name and aura to help promote more consumption of these unhealthy products.”

Neither the IOC nor Coke responded to requests for comment. But McDonald’s strongly protested being labeled by the study as a purveyor of unhealthy foods and argued that it has a proper role as an Olympic sponsor. “It makes the games possible,” a McDonald’s rep told Adweek. “The organizers and the athletes recognize that we have wide choices and variety across our menu to design a very well-balanced meal.”

The rep agreed that “millions of kids see our ads,” which he argued convey appropriate messages. One of the ads airing during NBC’s coverage of the Beijing Games features children playing soccer and then being treated to Happy Meals with chicken, apples and milk. (The apples come with an optional “low-fat” caramel dipping sauce.)

The IOC does ban sponsorships with liquor brands—a prohibition that Commercial Alert and Multinational Monitor argue should be extended to all alcoholic products, including beer and wine. Their study quotes George Hacker, director of the Washington-based Alcohol Policies Project, a unit of the Center for Science in the Public Interest. Sports, he said, “is a fundamental building block of character building and of youth development. . . . These values are fundamentally hijacked by beer companies when they get closely associated with sports, be they Olympic or college or even professional. It belies the true value of sports.”

Anheuser-Busch, an Olympic sponsor since 1984, did not immediately respond to calls for comment.

The study also concluded that the Olympics, with a record 63 sponsors this year, are over-commercialized: “The Olympic ideals of promoting authentic culture and education have been drowned beneath a sea of sponsorship and marketing arrangements.” It recommended that the IOC undertake its own examination of its sponsorship policies with the objective of scaling back the overall number.

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