(Bloomberg) -- Companies that forked out millions on Olympic sponsorships say the Paris Games are delivering the branding boost they were counting on, a relief after the pandemic-disrupted Tokyo Games.
“We didn’t have much that we could engage with and be supportive of in Tokyo, which was disappointing,” said Dave Stephenson, Airbnb Inc.’s chief business officer. In Paris, the company has been able to showcase its offerings, he said.
Some 11.3 million people will have visited the French capital by Sunday night’s closing ceremony, including 1.5 million from overseas, according to projections from the city’s tourism board. Viewership on television and via streaming has surged to multiples of Tokyo’s audiences, according to Comcast Corp.’s NBCUniversal, the broadcaster of the Games in the US, and Warner Bros. Discovery Inc., which owns Europe-wide TV rights. That’s good news for key sponsors, who get preferred advertising slots.
The influx of spectators to Paris makes the Olympics the largest single hosting event in Airbnb’s history. The online booking platform signed a deal in 2019 — reportedly worth $500 million — to become a worldwide sponsor for the summer and winter Olympics from Tokyo 2020 through Los Angeles 2028.
Some 430,000 Airbnb guests — and counting — have stayed in the Paris area during the Olympics, an outcome that was “better than we ever imagined,” said Brian Chesky, chief executive officer of the San Francisco-based company.
While some question whether sponsorships make an impact on the bottom line, there is value in being part of the Games, said Rob DiGisi, a sports management lecturer at the University of Pennsylvania’s Wharton School. “The eyes of the world are on you,” he said.
Aside from greater brand visibility and an association with one of the world’s premier sporting events, the Olympics also provide sponsors hospitality and relationship-building opportunities, DiGisi said — benefits that are difficult to quantify.
Delta Air Lines Inc. signed a deal worth a reported $400 million to become the official airline for the US Olympic and Paralympic Committee from 2021 through 2028, unseating United Airlines Holdings Inc. in the wake of the Tokyo Games.
Through its sponsorship — which involves transporting all US Olympians — Delta is betting on increased brand awareness, especially among travelers who fly internationally, an area the airline believes will drive its future growth, said Tim Mapes, the carrier’s chief communications officer.
Getting Team USA to the Games last month wasn’t without drama. Delta was hit by the CrowdStrike tech outage just when it was supposed to be transporting 1,800 athletes, coaches, staff and equipment to Paris. It had to scramble to get everyone there on time.
Airlines including Delta have also said that tourists steering clear of Paris this summer to avoid the Olympics have hurt sales.
Hiccups notwithstanding, the carrier will look to extend the sponsorship agreement to the Salt Lake City winter Olympics in 2034, Mapes said.
Drugmaker Eli Lilly & Co., which “rigorously measures corporate brand identity,” sponsors Team USA because it wants to associate itself with something positive, said CEO David Ricks.
It recruited several US Olympians as the face of its products, including Simone Biles, a three-time gold medalist at the Paris Olympics, and her mother Nellie. Both feature in a marketing campaign for the diabetes medicine Mounjaro, even though neither takes the drug.
Biles’ teammate and three-time medalist in Tokyo, Sunisa Lee, is in a campaign discussing her experience with eczema, also known as atopic dermatitis.
Ads featuring Olympians outperform Lilly’s regular drug advertisements, said Ricks. The marketing effort will drive profits, while the visibility of the Team USA sponsorship may increase physicians’ desire to work with Lilly on clinical trials and can be used to recruit new employees and lift sentiment among staff, he said.
“There is a broader halo that’s more difficult to measure,” he said.
Ricks declined to divulge the cost of the sponsorship, but said it’s by far Lilly’s largest, eclipsing its deal with the Indiana Fever of the Women’s National Basketball Association, the team that earlier this year signed Caitlin Clark.
Visa Inc. — like Airbnb a worldwide sponsor of the Games — provides the only non-cash form of payment accepted at official Olympics venues, where attendance has been robust, said Andrea Fairchild, the company’s senior vice president of global sponsorship strategy.
She declined to disclose details of the company’s deal with the International Olympic Committee, which stretches to the Games in Brisbane in 2032, but said Visa’s Olympics investment has grown over the years and is larger than its other partnerships, which include the FIFA World Cup and the National Football League.
“Every four years on a global scale, it gives us the opportunity to elevate our messaging and the work that we do,” she said. “You get in front of the entire world.”
--With assistance from Gina Turner.
©2024 Bloomberg L.P.
