(MintPress) – McDonald’s thought it had a good thing when it was awarded exclusive rights to serve French fries, or chips as they are often referred to as in England, at this year’s London Olympics. An initial agreement with the London Organising Committee of the Olympic and Paralympic Games (LOCOG) and the global fast food chain gave it exclusive rights to be the sole vendor of chips on Olympic grounds unless other vendors paired theirs with fish. The deal mirrored other instances of exclusive rights when it comes to contracts with this year’s Olympic officials.
But when 800 other eateries on the Olympic grounds caught wind of the band, owners and staff berated the monopoly, and the pressure caused the LOCOG to overturn it. A LOCOG spokesman said the committee spoke with McDonald’s about the change.
The Olympics are big business worldwide and a marketers dream location for brand recognition. The Olympic rings have been called one of the most recognizable symbols in the world, which has kept the United Kingdom’s Intellectual Property Office (IPO) a busy place. In 2006, the IPO created the London Olympic Games and Paralympic Games Act of 2006, which gave the LOCOG the power to “prevent unauthorized associations with the games.”
An online entry by the IPO encapsulates the big business of intellectual property during the Olympic Games:
“The laws relating to the 2012 Olympics are probably the most restrictive ever in their scope. This was widely accepted as the price necessary to ensure the degree of exclusivity that will attract the high price tags for official sponsorship packages,” the IPO wrote. “For those who cannot or will not pay to use these rights they present a significant barrier to any marketing initiative based on the Games. Even simple messages of support such as ‘X supports the London Olympics’ or ‘come to our bar and watch the 2012 Games on the big screen’ would probably infringe the London Olympic Association Right.”
Partners of an exclusive club
Exclusive rights and official brands of the Olympic Games are dictated by a system that classifies companies as worldwide partners, official partners, official supporters and official suppliers and providers. These partnerships give companies exclusive rights to provide retail to fans and be the official supplier of a product to the competitors.
Worldwide partners for this year’s games, of which there are 11, include Visa, Samsung, Coca-Cola and McDonald’s. Other partnerships include Adidas, British Airways and BMW. Coca-Cola has sponsored every Olympic Games since 1928.
But unprecedented heights were reached in Beijing during the 2008 Olympics. Prices for sponsorships were higher than they had ever been, and Coke was said to have spent upwards of $85 million to be a sponsor of the games and the torch relay.
2008 became a year when marketers began to question the effectiveness of sponsorships on the Olympics. As a battleground of revenue, the tiered system of sponsors left marketers wondering if anyone really paid attention to who was actually behind the funding of the games.
“We’ve done research in 10 cities throughout China and we’ve found most consumers have no idea who the actual official sponsors are,” Shaun Rein, head of the China Market Research Group, told National Public Radio in 2008. “We found 40 percent of consumers thought Coke was the sponsor, versus 60 percent for Pepsi.”
Who’s really benefitting?
London’s philosophy in restricting businesses that are not associated with the event has not been met with much support, as critics argue that it destroys the free market for the sake of sport. A Guardian poll in May found that 91 percent disagreed with London organizing committees’ brand restrictions.
Lord Coe, the chairman of the London 2012 organizing committee, said heavy-handed sponsorships are critical to see that the city can pay for the games, even at the expense of smaller, local companies. Coe said that this protects the taxpayers from having to cover any residual costs.
“Our first port of call has always been education rather than litigation. But it is very important to remember that by protecting these brands we’re also protecting the taxpayer,” Coe said. “If we don’t reach these targets, the taxpayer is the guarantor of last resort.”
One particular sponsor, however, has come under fire for its exploitation of workers during the process of making official Olympic apparel. Adidas is the target of a new campaign called War on Want, which denounces its use of sweatshops and wages that are not considered livable.
“Around the world, thousands of people making Adidas goods face appalling conditions, poverty wages and excessive working hours, with little dignity or respect,” said War on Want campaigner Murray Worthy in an Ekklesia report. “This is exploitation. Exploitation of workers is not ok, no matter where they are. Adidas must take responsibility for the workers who make their clothes.”
Adidas has more than 1,200 factories that span 65 countries. A short video put together by the campaign focuses on the story of a woman who was one of thousands of women in Asian working in the sweatshops. The video tells her story of abuse from her manager and living conditions that were a product of her low wages.
“He slapped me across the face and said that if I didn’t stay I’d lose the whole day’s pay … I work so long that I barely have time to see my own children,” the video narrates. “And even then I struggle to feed my family … I don’t earn enough to live.”