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Nic Couchman | Athletes in the ascendant

Nic Couchman, head of sport at Charles Russell Speechlys, explains why May 2020 could be a watershed month in Olympic marketing.

The first truly global ‘social media Olympics’ takes place next year. Since the Rio Games in 2016, the reach of the biggest social media platforms has increased by between 50 and 100 per cent. The combined monthly active user base of Facebook, Twitter, Instagram, Weibo and WeChat now exceeds 5.3 billion people.

It takes only a few minutes for Olympic athletes to set up social media accounts, potentially directly accessing this enormous audience, 24/7. Their performances in Tokyo will be broadcast on major TV networks and news platforms to hundreds of millions of viewers worldwide, who will be able to engage immediately with their heroes and heroines online. For the first time for many of them, athletes will be able to market themselves, their own brands and their sponsors worldwide. A unique opportunity which the well-prepared athlete, and his or her brand partners, will not want to miss.

But if they don’t get their acts together in the next few months, they may be disappointed. Under the now somewhat infamous IOC Rule 40, Olympic athletes, are restricted from promoting their sponsors from approximately a week before the Games until three days afterwards, i.e. potentially when they are at their most high-profile, and valuable.

Although the IOC has appeared to relax the rule recently (and will be issuing guidance to clarify its new approach shortly), Rule 40 as applied by different national Olympic associations continues to be highly controversial. In the wake of a successful German court challenge in February 2019, which described Rule 40 as ‘abusive conduct’, a group of British athletes including Mo Farah, have recently threatened legal action against the British Olympic Association if their regulation is not changed.

In simple terms, the argument runs that the IOC and Olympic associations are preventing athletes, who at the end of the day are not their paid employees, from fully exploiting their image rights and advertising and promotional opportunities at the very moment when they are at their peak value. Justifications advanced by the rule makers, include that these restrictions are necessary for them to continue to attract global or national Olympic sponsorships, and deliver category exclusivity. This is of course an unproven position. Sponsorship represents only about 18 per cent of the IOC’s income. It can represent 80 per cent or more of an athlete’s earnings.

Challenges to the traditional Olympic advertising regulatory landscape will also be amplified by the arrival in Tokyo of new breeds of athlete, surfers and skateboarders amongst them. These are largely independent sports people in individual, not team, sports, who have always operated outside the confines of the Olympic movement, and whose careers depend on personal sponsorship. They often have a very close relationship with their partners, especially apparel and equipment brands. They also typically have strong social media channels, producing and distributing their own content frequently. Whilst the opportunity to compete for their countries on a world stage will be extremely attractive to many, they, and their highly-experienced brand partners, are unlikely to kowtow to outdated regulations which purport to limit their marketing freedoms and income generating potential, and/or will simply find ‘work arounds’.

The US Olympic and Paralympic Committee has also tried to be creative, introducing a rule whereby athlete sponsors can promote their association during the Games, provided they sign a ‘Personal Sponsor Commitment’. This is an interesting development, but canny brands may think that keeping their options open is preferable to signing up to an Olympic rule book, especially in a fluid environment with athlete activism on the increase.

Back to the headline – May 2020 is a critical date. Some Olympic associations have said that sponsors and athletes can engage in generic advertising (i.e. not using Olympic insignia or marks) during the Games period, as long as their campaigns are underway on the same basis at least 90 days prior to the Games period, presumably with the aim of deterring sponsorship activity which only cranks up close to the Games. For British athletes, these campaigns need to have been approved by May 14.

In any event, it would seem that the rising floodwaters of social media are about to breach the Rule 40 “dam”. The IOC and national associations might do well, when considering their response to this new reality, to look at developments in football, where clubs are beginning to appreciate that the power and reach of their leading players generates fan engagement to the benefit of the club, and club sponsors, and is not something to quell or control at all costs.

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