Long-running Olympics sponsor McDonald's ended its partnership with the IOC in a surprise move last week only to be swiftly replaced by Intel. But, on closer inspection, was it an inevitability given the shifting nature of sports sponsorship?
It’s no secret that the Rio Olympics failed to generate the kind of return brands had hoped for from the first ever South American Games, promoting sponsors to reconsider their place atop the pinnacle of sport. The recent swap between McDonald’s and Intel illustrates the changing landscape Olympic marketing, one where brands, like athletes, must prove they can contribute something towards the experience for audiences.
Five days after McDonald's announced it was walking away from its Olympic sponsorship three-years early, Intel was unveiled as its replacement.
McDonald's departure has not come as a shock to many within the industry given the difficulty it had with activating the sponsorship. Unlike infrastructure brands like Atos and General Electric, it doesn’t have a tangible contribution to the improving the experience for audiences.
“From an Olympic sponsorship perspective, brands that have had significant success with this type of partnership often tend to be those that are connected to Olympic Games delivery, or have found a clear product story to tell like Samsung or P&G,” suggested Joel-Seymour Hyde, senior vice-president of Octagon.
This, coupled with the changing attitudes towards fast food in recent years, has only served to raise the bar higher still for McDonald's and made it harder for it to tell its own story.
Other hurdles which Hyde points to include the IOC’s regulations preventing on-field assets such as the Player Escort Programme that McDonald's has with the Fifa World Cup and the Uefa European Championships.
Away from the events themselves, much of the media attention McDonald’s gained around the event only served to perpetuate the negative image which the brand has worked tirelessly to turnaround.
Jamie Wynne-Morgan, managing director of M&C Saatchi Sport & Entertainment, said McDonald's essentially became "the naughty treat that Olympians were having”.
“The stories that came out about these athletes, who after years of perfect training and eating, were having junk food immediately following their events, was not the image the McDonald’s brand is trying to portray.”
The swiftness of the transition from McDonald’s to Intel gives weight to the assertion that the parting of ways between the IOC and the fast food giant was mutual, the IOC had been rumoured to be partnering with Intel in the weeks leading up to the announcement.
Commentators agree that Intel represents a far more natural fit for the IOC given tech giant has been targeting the sports industry as part of its bigger push into emerging technologies. Last year it announced a partnership with Major League Baseball (MLB) which saw it provide stats around the MLB’s live inventory. It followed this up with a recent announcement that it would use VR tech to broadcast live games and highlights.
In April this year, it agreed a partnership with the International Cricket Council (ICC) to become the official innovation partner for the 2017 Champions Trophy. As part of the agreement Intel will use drones equipped with HD and infrared cameras to assess grass topology and provide commentators with value data during matches. It will also use sensors within bats to gather data and offer fans the chance to test their batting skills through VR experiences.
The brand will take this approach and build upon it through its Olympics sponsorship. It plans to develop “technology solutions” around the games which will see the developing of new applications and platforms for VR, including the first live broadcast in VR of Olympics events, 3D and 360-content; AI analytics; drones; and 5G services.
Joanne Warnes, chief operating officer at HSE Cake believes Intel is using the Olympics to "help tackle a the challenge of repositioning its brand."
"Intel is famous for providing the chips that power our computers. But the deal announcement and accompanying spin was pushing VR and telling a 'future of technology' story."
Hyde added: “In terms of Intel, I think the 'fit' is easier to see straight away. As a tech company, particularly one that is pushing innovation hard, the Olympics offers a compelling platform for brand not only to tell its story but also to showcase it on a global level.”
Looking ahead, Wynne-Morgan pointed out that Intel have come on-board at an opportune moment given that the Olympics upcoming schedule for the Games will include “some big markets and marketing opportunities” in Tokyo and either LA or Paris in 2024.
Intel’s involvement around sport is part of the brand’s transition to becoming a far more consumer-focused brand, a strategy which led it to become the title sponsor of one of the biggest eSports tournament in the world, the Intel Extreme Masters finals, five years ago.
ESports is another example of the brand using its DNA to improve the fan experience, according to William Field, a consultant at Prospero. He said that the way eSports is evolving, “Intel will have a big part to play”.
With the Asian games including an esport event for 2022, it’s not inconceivable that the IOC could also one day include eSports as an Olympic event and in that instance Field added that “Intel would have a very strong and natural relevance”.
McDonald’s departure and Intel’s arrival sums up the evolution of sports marketing around the Olympics. With the relaxation of Article 40 giving non-sponsors more opportunities to market around the event and the fast-pace tech market constantly redefining how we consume sports, sponsors investing huge sums to become a top-level sponsor must have something tangible to offer audiences. If they fail to demonstrate how they can add value to the delivery of the Games, the fan experience or the athletes, they’ll fall at the first hurdle.