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Ambush Marketing Top Concern For Sports Officials

Reuters, September 24, 2010

By Ben Klayman

DETROIT – On a sunny day in June in South Africa, three dozen women clad in identical flattering orange dresses were ejected from a World Cup football match. The offense: wearing dresses distributed by the company competing with the sponsor of FIFA's quadrennial event.

Bavaria, a rival of World Cup sponsor Budweiser, sold hundreds of the dresses before the tournament. In what FIFA believed was a coordinated action, the so-called "Bavaria Babes" were accused of "ambush marketing," which is illegal in South Africa.

Ambush marketing is the act of mounting a promotional campaign to associate the company with a team, league or event without paying for the privilege. It is believed to be the biggest risk for advertisers seeking sponsorships at sporting events, according to a survey released on Friday.

Some 41 percent of 228 respondents rated ambush marketing their top concern, followed by counterfeit or knockoff merchandise (29 percent) and improper behavior among top athletes (27 percent). The survey of sports marketers was conducted by the Chief Marketing Officer Council.

"Ambush marketing poses a very odd fringe gray area threat because it's not technically trespassing on a trademark," CMO vice president Liz Miller told Reuters.

"It's not hijacking someone's brand. It's more like they're hijacking the entire event," added Miller, whose group represents more than 5,000 senior marketers.

Jeff Bliss, president of consultant Javelin Group and former chief marketing officer of the 1994 World Cup, said in the report, "We've come a long way, but there are a lot of creative, ingenious people out there who can get around the rules."

Organizations like FIFA, which runs the World Cup, and the International Olympic Committee derive billions of dollars from their sponsors, and want to stop the ambush marketing that threatens that revenue.

The World Cup, for example, will generate $1.6 billion in sponsorship revenue from 2007 to 2010, according to IEG, a unit of advertising firm WPP Plc.

The weak U.S. economy has led some companies to turn to ambush marketing at sporting events as a way to get their message out in a less costly manner by avoiding sponsorship fees, Miller said.

"Consumers don't care," Miller acknowledges. "They're not walking through the stands saying, 'You know, I don't think that they're the official sponsor.'"

As a result, sports sponsorships are not effective by themselves. They must be combined with a broader marketing strategy, including ads on television, the Internet, cellphones, merchandising and promotions, respondents in the survey said.

"If (sponsors) raised their game, there wouldn't be any room for ambushes," said Kim Skildum-Reid, a corporate sponsorship strategist and owner of Power Sponsorship, in the report.
About 41 percent of survey respondents plan to integrate their sports sponsorships with other forms of advertising, while about a third are increasing merchandising and promotions, and 30 percent are negotiating more comprehensive sponsorship deals.

And that fits with the way sponsorships are viewed today. They need to demonstrate measurable sales gains by persuading customers to buy a company's products, rather than the conventional wisdom of just building a brand to boost sales.

Some 54 percent of respondents in the survey said sports marketing programs are effective or somewhat successful, but 27 percent still acknowledged trouble in determining the value of such deals.