Are premiums and incentives a good buy for the Olympics?

Marketers say it's an invaluable awareness builder

The 16 Canadian sponsors of the coming 2004 Olympic Summer Games in Athens have shelled out a minimum of $1 million each for the right to bear the Olympic logo on their products and services. What most have in common is that they’re running premiums and incentives programs to go with it.

And this time of year, the goal of all these marketers is not so much sales, but positive brand awareness. They say the Olympics are a sure-fire way to build it, especially when giveaways consist of collectibles or other valuable items.

‘[Premiums and incentives] foster interest and when you have an Olympic Games, people become more patriotic than average. If you can tap into that, it can have some positive effects on your brand,’ says Tom Beakbane of Toronto-based advertising agency Beakbane Marketing.

Steven Keith, director of downstream communications for Calgary-based Petro-Canada, says that insight is the primary reason for the oil and gas retailer’s association with the Olympics. ‘We view the Olympic connection as being the greatest source of brand esteem that we have,’ he says.

This year Petro-Canada is offering Roots cooler bags for $9.99 with fill-up. He notes that research the company has conducted indicates that when Canadians are asked with what they associate Petro-Canada, the Olympics come third after oil and gas.

Visa has seen similar results from its long association with the Games. According to Gallant Law, senior product manager, consumer products for the Toronto-based financial services company, Visa has conducted tracking studies that show positive benefits for the brand. ‘With us being associated with the Olympics, our cardholders feel a lot better about our brand and associate the Olympic values with our Visa values [such as] excellence, confidence, empowerment and leadership.’

This year, Visa, which has sponsored the Games since 1988, is running contests for cardholders that allow them to win trips to future Games by making purchases with their Visa cards. It is also sponsoring four Olympic hopefuls under the name Team Visa and giving away free Olympic lapel pins, which Law says ‘further reinforces our long-time support of the Games in the mind of the consumer.’

Other marketers are relative newbies to the Games, but are also looking to leverage the event to create positive brand awareness. Ed Madronich, marketing manager for Toronto-based Inniskillin Wines, says that while his bosses are naturally looking for an increase in sales, ‘there are a couple more important things’ from his perspective. Along with its sponsorship, its P&I promotions include wine charms, commemorative bottles and publicity events.

Explains Madronich, ‘The association with the Olympics and what it stands for falls in line with what we believe and what we stand for – excellence, commitment, passion. So that’s a soft strategic objective that our alliance with the Canadian Olympic team provides us.’

Carolyn Ray, director, integrated communications and planning at Toronto-based agency Interbrand, says that’s the right approach.

‘When you choose a sponsorship opportunity, you need to make sure it’s aligned with your brand. To choose the right sponsorship, you need to know what you stand for as a company and then you can align your brand values with that sponsorship and out of that create a number of brand-focused activities. Premiums would be one of those.’

However, she also cautions marketers against thinking that just showing up for the Games and handing out free stuff is good enough. She points to New York-based DDB Needham’s SponsorWatch, which has been measuring the link between brand and sponsorship since 1984. Only 15% of sponsors of the Olympic Games have realized increased brand awareness higher than competitors who are not sponsors. For those who performed better the difference has been that they have used a number of other brand-driven activities (such as promotions, newsletters, Web sites, etc.) over an extended period of time alongside the sponsorship.

Inniskillin’s Madronich says that in terms of extending the value of the sponsorship, having collectible premiums also helps. ‘With the Olympics, collectibility is certainly an important factor. It definitely provides a long-term benefit to the brand.’

Other marketers’ items, like Visa’s limited-issue lapel pins (about 2,000), didn’t start out as collectible but have become that, says Law.

Either way, some say, making collectibility a factor in your choice of premium depends on the marketer’s objective and need not be automatic.

‘If you’re selling at retail and you want to drive transactions, then your best bet would be to design a premium that people need to collect in order to realize full value,’ says Dave Allen, account director at Toronto-based The Marketing Store. ‘Then there are those who invest in the Olympic opportunity for nothing more than to build their corporate profile and for BtoB [reasons]…and use it, [for example], to get access to venues and reward employees for performance.’

Another strategy being pursued by one marketer is better prizing. That may seem like a no-brainer, but try that when you’re a packaged goods marketer that mostly sells cereal, like General Mills. Greg Cyr, director of promotion marketing for the Toronto-based company, says General Mills is moving away from trinkets toward items that have ‘real value’ for consumers. The trend started with CD-ROMs and now for the Olympics, General Mills is offering an on-pack coupon good for $10 off merchandise at Roots, the Games’ official Canadian apparel sponsor.

‘We’re trying to focus on value to the consumer,’ says Cyr. ‘Consumers [don't] value pencil toppers or tattoos or magnets as they have in the past. And value is what is really driving the excitement of the consumer.’

Interbrand’s Ray applauds the strategy, adding, ‘It sounds like General Mills is making sure that it can measure impact [through the coupon], which is key. Whenever you do a sponsorship, you want to be able to measure some kind of return on investment.’

Of course, for some it’s still all about the search for increased sales. That’s the case with Olympic sponsor Coca-Cola. The beverage giant is running on-pack giveaways for additional product and chances to win a Visa Gold card, valued up to $100,000 (see sidebar p.32).

Laura Cutsey, national promotions manager, says that Coca-Cola is certainly interested in leveraging feelings of patriotism (a commemorative bottle is being issued to build awareness by serving as a keepsake) to increase positive association with its brands, but ‘the goal of the promotion is to [gain] volume lifts across the country.’

She says premiums and incentives are a necessary part of Coca-Cola’s Quest for Gold advertising campaign, not least of all because consumers want free stuff.

‘From a consumer standpoint, ‘what’s in it for me?’ is a question they ask all the time. So if we’re recruiting new users to Coca-Cola and its brands, then we want to make sure we’re rewarding them for that.’

Coca-Cola’s quest for gold

While most marketers settle quite logically on themes of patriotism to boost their images and their brands during Olympic time, at least one is adopting a counter-intuitive strategy. Coca-Cola’s ‘Quest for Gold’ campaign is going for humour with nary a flag in sight.

According to Chris Johnston, group manager for the Toronto-based beverage maker, ‘Our focus is to lighten up the brand a little bit and we’ve used humour to appeal to [our target of young people].’

He says the TV spot currently airing is about building the promotion rather than building brand equity. ‘Rather than using the Olympics to make a connection with the Coca-Cola brand [in advertising], we really have used the fact that there are going to be a lot of gatherings of friends and family to watch the Olympics,’ he explains. ‘We thought it would be a great opportunity to [highlight] a promotion.’

The spot is called ‘Bling’ and was created by Toronto-based MacLaren McCann. It features a group of youth watching TV and drinking Coke. They get a big surprise when a friend comes in absurdly weighed down with gold chains, old-school rapper style, because he

‘completed’ the ‘quest for gold.’

The ad informs consumers that they have a chance to win a credit of up to $100,000 on a Visa Gold card via an on-pack promotion. It is currently running nationally and will air to the end of July.

‘The real motivator here is the prizing offer,’ says Johnston. ‘We’ve used the fact we’re a long-standing, 75-year partner with the Olympics as a thematic and we’ve named the promotion based on that, but it’s kind of a double entendre because the idea of ‘quest for gold’ is the idea you’re reaching for some money.’ – by Samson Okalow