Olympic marketing was set up to ensure that the organization has a fully sustainable financing to be able to support the Olympics activities in the world. Olympics marketing department aims to come up with programs that are long-term to secure the future of the organization and the Olympic-games. The Olympic marketing division is also tasked with the duties of ensuring equitable distribution of revenues throughout the Olympic movement, such as the NOCs and their associations. The possibility of experiencing the Olympic-games via free-air television is as a result of the Olympics marketing. Moreover, the marketing department ensures that they control and limit the commercialization of the Olympic-games (Gleeson and Cox, 2006).
The key features of the Olympic marketing include the following
Revenue generation
Revenue distribution
Contribution to the OCOGs
Contribution to NOCs
Contribution to national federations
Strategic areas their trend and how they are addressed
This is a strategic area where Olympic marketing enters into contracts with corporations that provide financial support. The corporations, in turn, get specific intellectual property rights and marketing opportunities. The number of corporations that have provided the financial support has been growing over the years since, 1896. The following trend shows how the partnership growth has progressed.
During the Olympics I Athens, in 1896 the Olympic organization embarked the partnership with corporations such as Kodak. In 1824, in Paris, an advertising signage was availed to the public view in the Olympic-games venues.
The international marketing program was launched in 1952 in Helsinki. At this point corporations from eleven countries made their contribution and declared their partnership in the games.
In 1960 the number of sponsorship partners increased to 46. Moreover in 1964 250 corporations developed relations with the games. The same year a new cigarette is known as Olympia cigarette generated over the US $ 1illion for the OCOG.
The number of sponsorships increased to 628 in 1976. The following event that took place in Athens in 2004 surprised many as it is the smallest country that has ever hosted Olympics. Furthermore, it sold its tickets two years before the game met its targets (Gleeson and Cox, 2006).
This is an Olympic strategic area that is tasked with the duty of dealing with the spread of information. The International Olympics committees the one responsible for allocating rights to the broadcasting through networks in the world. This is done to ensure that long-term interests of the organization are safeguarded.
According to the Olympics chatter of September 2014, television right to the Olympic-games is only sold to broadcasters that demonstrate the capability to broadcast free to air coverage. The Olympic-games is the only major event that has maintained such a policy.
According to the marketing report on the television broadcast, the number of viewership goes on growing year after year, with a total of 138 viewing hours. The revenues generated from the broadcast have also tremendously increased (Gleeson and Cox, 2006).
The first broadcast was made on 1936 in Berlin and it televised around Berlin only. During this time only one camera was capable of live coverage, and it did so when the sun was shining. In 1984 the Olympic-games established the principle for the broadcast rights fee.
During the time more than 500,000 viewers, watched the 64-hour program on Olympics. In 1956, the negotiations on broadcast rights failed which prevented the broadcasting to important markets including the United States of America (Gleeson and Cox, 2006).
In 1958 article 49 was introduced that consisted of broadcast rights that have been incorporated into the Olympics.
The first broadcast of Olympic-games on satellite coverage took place in 1964 and used to relay images overseas. During the Mexico City games, the first live color broadcast was done in 1968.
In 1994 broadcast and marketing programs generated more than the US $ 500 billion almost breaking the record of every major Olympic winter game. Marketing records show that more than 120 countries viewed the coverage from Lillehammer. In 1996, the international Olympics committee underwrote the transmission rights to broadcast in Africa.
In 2012, 100 million viewers in India received free to air coverage.
In 2004 there were more than 300 television channels with a total of 3500 hours coverage, with 3-9 billion viewers in 220 countries (Gleeson and Cox, 2006).
The ticketing program in the Olympics is managed by the OCOG drawing its permission from the IOC international Olympics committee. The program enables as many people as possible who love the Olympics to have access to the Olympic-games and ceremonies. The other objective of the program is to generate commercial revenue that is later used to support the Olympics events.
According to the reports, the lowest percentage of tickets ever sold was about 72% of the total in Athens during the 2004 events. On the other hand, the highest ticket sale was in 2002 that was around 95% of the total produced tickets. This happened in salt-lake events (Gleeson and Cox, 2006).
The Olympic movement created products, merchandise, and souvenirs that are related to the games, for the consumer. The arrangement was made through licensing agreement that granted the use of Olympics marks imagery or themes by the third companies. In 1896, the organization proposed the use of Olympic stamps. The sale of these produced revenues that help build the Olympic sports venues.
In 1912 12 Swedish companies purchased sole rights to take photographs and sell memorabilia of the games. In Helsinki, 1952, Olympics coins were issued with a face value and legal tender that helped raise the funding without any increase in government taxation. In 1972 the first official right to use the first official Olympic emblem was sold. In 1992, 137 countries issued 1,239,000 stamp series of the Olympic rings.
1994, the broadcast licensing generated three times of the targeted revenues and sets new standards.
In 1996, more than 150 countries embraced the use of the Olympic stamps, and in the year 2,000, the merchandise was coded with the DNA of a famous athlete to curb counterfeits (Gleeson and Cox, 2006).
Corporations and the Olympic marketing enters into contracts with the aim of providing financial support for the movement. The corporations, in turn, are given specific intellectual property rights and marketing opportunities. The number of corporations that have provided the financial support has been growing over the years since, 1896. This arrangement has enabled the Olympic-games cost share the burden of hosting and financing the games. Sponsors who have stuck with the games all through like benefited as they have been able to reach a very wide variety of customers since the Olympics are viewed across the world (Gleeson and Cox, 2006).
Broadcast deals with the spread of information. The International Olympics committees the one responsible for issuing rights to broadcasters who broadcast across networks in the world. This is done to ensure that long-term interests of the organization are safeguarded (Gleeson and Cox, 2006).
According to the Olympics chatter of September 2014, television right to the Olympic-games is only sold to broadcasters that demonstrate the capability to broadcast free to air coverage. The Olympic-games is the only major event that has maintained such a policy.
The marketing report shows that the number of viewership goes on increasing year after year, with an average of 138 viewing hours. The revenues generated from the broadcast have also tremendously increased (Gleeson and Cox, 2006).
The first broadcast was made on 1936 in Berlin and it televised around Berlin only. During this time only one camera was capable of live coverage, and it did so when the sun was shining. In 1984 the Olympic-games established the principle for the broadcast rights fee. This was to create a stream for income generation as well as limit the misuse of the movement intellectual property. The broadcasting segment has undergone various changes to align it with the goals of the marketing organization. The segment has been put under the policy to sell air right to broadcasters with the mandate from the international Olympics committee. The selling of this right has generated revenues that have been used to support the organization. Moreover, the organization has made sure that the broadcast rights are issued to those broadcasters who have the capacity of free to air thus ensuring that the viewership extends across the world (Gleeson and Cox, 2006).
The ticketing program in the Olympics is managed by the OCOG drawing its permission from the IOC international Olympics committee. The program enables as many people as possible who love the Olympics get accesses to the Olympic-games and ceremonies. The other objective of the program is to generate commercial revenue that is later used to support the Olympics events (Gleeson and Cox, 2006).
The report shows that the lowest percentage of tickets ever sold was averaging at 72% in Athens during the 2004 events. On the other hand, the highest ticket sale was in 2002 that was around 95% of the total produced tickets. This happened in salt-lake events. The ticketing initiative has seen the International Olympic organization manage to host the events and ceremonies (McCann, 2006).
The marketing programs are formed to ensure the stability of the organization financially and independence while assisting the worldwide to the promotion of Olympics.
Ensure that the revenues are distributed equitably throughout the Olympic movement. The distribution involves OCOGs, NOCs, and their continental association.
The revenues generated from marketing activities, part of it is distributed to the OCOGs to help in funding their activities.
The revenues realized from the marketing activities, part of it goes to the NOCs
International federations also share in the distributed of income generated through the marketing activities (McCann, 2006).
Policy objectives for Commercialization Initiatives
The international Olympics committee has made several efforts to improve the policies that govern the marketing of the Olympic-games. Such policies include,
The policy on broadcasting found in the amendment Olympic chatter of September 2014. The charter stipulates that the issuance of broadcasting rights should be given to those broadcasters who demonstrate the capability of free to air television. This policy safeguards the interests of the Olympic movement by ensuring the viewers can view at no cost (Gleeson and Cox, 2006).
The Olympic movement introduced a right broadcast fee in 1948. The aim of the fee was to ensure that the Olympics property rights are safeguarded. Also, the issuance of the right was accompanied by the generation of revenues that are used to fund the organization activities. Moreover, the rights guaranteed worldwide coverage from the companies that were granted the rights (McCann, 2006).
Another policy initiative is the coding of the merchandise with a famous athletes DNA this ensured that the merchandise could not be pirated as well as provide continuous cash inflow to the movement (Gleeson and Cox, 2006).
The other policy was made on the licensing of Olympic stamps that further increased the marketing of the movement as well as generated revenue for the movement as well as the partner corporation.
The performance indicators will be directed to the strategic areas of marketing that generate revenue for the movement. These areas include partnership and sponsorship broadcasting ticketing and licensing. The areas will each contain its benchmark against which the performance will be judged from (Key performance indicators, 2009).
Partnership and sponsorship initiative are growing year by year though there is still enough room for more partners. The involvement of more partners will lower the cost of hosting the games as well as increase the revenues. Currently, the highest amount obtained from the sponsors stands at the US $ 866 million the target should be to raise the sponsorship initiative to the US $ 1 billion by increasing the space meant for the sponsors.
The other performance that requires a target increment is the broadcasting, which seems to be generating a lot beyond the expectations of the international Olympics committee. The revenues generated, however, need to be subjected to the Olympic movement standards. This will ensure that the organization is on toes and does not relax. The current best performance stands at US$ 1.5 billion the amount should be raised to reach a US $ 2 billion targets.
Ticketing needs a new benchmark. Ticketing is currently at the US $ 551 million this needs to be raised to the US $ 6 million (White, 2011).
Olympic licensing revenue generation is currently at US$ 91 million the benchmark will be set at 100 million.
|
Strategic area of focus |
Currently best-achieved amount |
Standard/ targeted amount |
|
Partnership/ Sponsorship |
US $ 866 MILLION |
US $ 1 BILLION |
|
Broadcasting |
US $1.5 BILLION |
US $ 2 BILLION |
|
Ticketing |
US $ 551 MILLION |
US $ 6 MILLION |
|
Licensing |
US $ 91 MILLION |
US $ 100 MILLION |
The concerned stakeholders are the partners NOC official OCOGs members and the marketing team; the performance indicators will be communicated during the meeting as well as be published on the inside journal. The website will also be an excellent platform to share these benchmarks (Preen, 2012).
The code of conduct of the Olympic movement will be written in a way that ensures it serves the interest of the organization as well as the staff organizing the event. The code of conduct will be available in handbooks. The new set key performance indicators will also be included in the handbook to ensure that they are achievable by following the principals on the code of conduct.
An evaluation will be continuously conducted by subjecting the actual performance to the set standards (Organizational Communication, 2010). A record will be kept concerning the performance for future referral. The key performance indicators will serve to improve the financial situation as well as the activities of the movement (Tate and McLinden, 2008).
Assessment Task 2
Given that the market outcomes cannot be predictable to some degree, it is wise to set targets that the movement needs to hit. In most cases, the market has surprised the international Olympics committee due to over performance while other times it has frustrated them. For instance, the sale of broadcast rights outperformed the set target three times more as well as the sale of tickets in Athens. However, the sale of the Olympic merchandise has not had an impressive performance (Tate and McLinden, 2008).
The current performance reported is significantly impressive. However, the actual performance has not yet satisfied the goals of the Olympic movement fully. For instance, the broadcast is made free to air so that it can reach everyone at every corner of the world. The free to air policy is sustainable but a large part of the targeted audience does not access a television in rural areas.
Ticketing is meant to give everyone access to the Olympic-games and ceremonies, but most of the time the ticket are not completely sold. This reduces the revenue targeted through the strategic area of ticketing (Parmenter, 2015).
This is an area where Olympic marketing enters into contracts with corporations that provide financial support. The corporations, in turn, benefit from specific intellectual property rights and marketing opportunities. Over the years the number of corporations that have provided the financial support has been growing significantly. This arrangement has enabled the Olympic management to cost share the burden of hosting and financing the games. Those sponsors who have stuck with the games all through have realized the benefits as they have been able to reach a very wide variety of customers since the Olympics are viewed throughout the whole world (Organizational Communication, 2010).
Broadcasting is part of Olympic marketing that is tasked with the duty of dealing with the spread of information. The International Olympics committees are the one responsible for allocating the broadcasting rights through the broadcasting department. The rights are accessible to all networks in the world provided they meet the requirements. This is done to ensure that long-term interests of the organization are safeguarded (McCann, 2006).
According to the Olympics chatter of September 2014, television right to the Olympic Games is only sold to broadcasters that demonstrate the capability to broadcast free to air coverage. The Olympic-games is the only major event that has maintained such a policy.
According to the marketing report on the television broadcast, the number of viewership goes on increasing year after year, with a total of 138 viewing hours. The revenues generated from the broadcast have also tremendously increased (McCann, 2006).
The first broadcast was made on 1936 in Berlin and it televised around Berlin only. During this time only one camera was capable of live coverage, and it did so when the sun was shining. In 1984 the Olympic-games established the principle for the broadcast rights fee. The broadcasting segment has undergone various changes to align it with the goals of the marketing organization. The segment has been put under the policy to sell air right to broadcasters with the mandate from the international Olympics committee. The selling of these rights has generated revenues that have been used to support the organization. Moreover, the organization has made sure that the broadcast rights are issued to those broadcasters who have the capacity of free to air thus ensuring that the viewership extends across the world (Parmenter, 2015).
Ticketing program is managed by the OCOG that draws its authority from the IOC international Olympics committee. The program is set up to make sure many people as possible who love the Olympics get accesses to the Olympic-games and ceremonies. The secondary goal of the program is to generate commercial revenue that is later used to support the Olympics events.
According to the reports, the lowest percentages of tickets ever sold were averaging at 72% in Athens during the 2004 games. On the other hand, the highest ticket sale was in 2002 that was around 95% of the total produced tickets. This happened in salt-lake events. The ticketing initiative has seen the International Olympic organization manage to host the events and ceremonies. Using the new performance indicators the Olympic movement will strive to maintain the ticket sale above 90% if at all they are to meet the set revenue targets (White, 2011).
The Olympic movements have had significant improvement over the years. The improvements are brought about by its attractiveness to the people as well as corporations. However, the lack of competitors may delay the much-needed improvements especially in the modern world where everything is advancing day and night. Areas like ticketing need to be done online, partnership and sponsorship allocations need to be increased to be able to generate more revenue. The broadcasting rights also need to be done online. By doing this, the cost of handling this activity will reduce as well as increase the profits and the returns on investment (Vos, Otte and Linders, 2013).
The use of digital gadgets and equipment has now dominated most of the human life. People are now able to socialize around the world and obtain real-time information through the internet especially the social media such as Facebook, Twitter, and Instagram. Moreover, events tickets are now being sold through the internet which has the capability to reach a lot of people across the world. The Olympic movement needs to hitch its wagon on the technology platform to be able to reach as many people as possible (Preen, 2012).
The Olympic-games are held after every four years. The time needed to train the staff may be limited as the staff comes together once after four years. Moreover, the long period may bring about uncertainty as training might be provided to individuals who will never make it see the next Olympic-games. However the time for training the employees may be scheduled to be taking place a year before. This will ensure that the staff training and development has adequate time to incorporate that entire take place during the games (Potter, 2008).
Conclusion and Recommendations
The Olympic movement has for years done an incredible job in hosting games as well as providing a platform for the corporations to market their products. Moreover, the movement has promoted worldwide integration through the games. The revenues generated seem to be sustainable enough to see the movement in hosting the games. However, the Olympics movement face no competition from any other movement. Due to this laxity and poor quality of services to customers can set in therefore making the movement to lose its pride. To overcome this challenge the movement needs to incorporate the performance indicators in their performance evaluation. The indicators will provide direction to the movement. The key performance indicators will motivate the key strategic areas to find new and innovative ways of achieving their targets, such as the adoption of electronic ticketing and social media marketing.
References
Beckmen, R. and Mapa, J. (2014). Communication & planning. 1st ed. Minneapolis: Augsburg Pub. House.
Boehme, A. (2009). Planning successful meetings and events. 1st ed. New York: Amacom.
Franceschini, F., Galetto, M. and Maisano, D. (2010). Management by Measurement. 1st ed. Berlin: Springer Berlin.
Gleeson, L. and Cox, D. (2006). Ray’s Olympics. 1st ed. Canberra: National Museum of Australia Press.
Key performance indicators. (2009). Dental Abstracts, 54(5), p.232.
Key performance indicators in public-private partnerships. (2011). 1st ed. Washington, DC: Federal Highway Administration, Office of International Programs.
McCann, L. (2006). The Olympics. 1st ed. London: Facts, Figures & Fun.
Organizational communication. (2010). Long Range Planning, 23(4), p.123.
Parmenter, D. (2015). Key performance indicators. 1st ed. Hoboken, N.J.: Wiley.
Potter, L. (2008). The communication plan. 1st ed. San Francisco, Calif.: International Association of Business Communicators.
Preen, J. (2012). Business continuity communications. 1st ed. London: BSI.
Tate, D. and McLinden, D. (2008). Performance Indicators in Business Decision Making. Performance Improvement Quarterly, 5(1), pp.25-34.
Vos, M., Otte, J. and Linders, P. (2013). Setting up a strategic communication plan. 1st ed. Utrecht [Netherlands]: Lemma.
White, J. (2011). Performance Management Through Societal Performance Indicators. International Journal of Business Intelligence Research, 2(4), pp.29-41.
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