PARASITIC MARKETING IN INDIA
TITLE OF THE PROJECT
“PARASITIC MARKETING”
Name Of The Student Aditya Jajodia TYBMS Roll No. A 34
Name And Address Of The College Usha Pravin Gandhi College of Management Bhaktivedanta Swami Marg, Vile Parle (W), Mumbai – 400056
Date Of Submission
15th September, 2008
-1-
PARASITIC MARKETING IN INDIA
DECLARATION
I, MR. ADITYA JAJODIA OF USHA PRAVIN GANDHI COLLEGE OF MANAGEMENT OF T.Y.BMS (SEM 5) HAVE COMPLETED THE PROJECT ON “PARASITIC MARKETING” IN THE ACADEMIC YEAR 2008-2009. THE INFORMATION SUBMITTED IS TRUE AND ORIGINAL TO THE BEST OF MY KNOWLEDGE.
Date: 14TH September, 2008
Signature Of The Student
Place: Mumbai
( ADITYA JAJODIA )
-2-
PARASITIC MARKETING IN INDIA
CERTIFICATE
I, MR. ADITYA JAIN , HEREBY CERTIFY THAT_ADITYA JAJODIA_, OF USHA PRAVIN GANDHI COLLEGE OF MANAGEMENT HAS
COMPLETED THE PROJECT ON “PARASITIC MARKETING” IN THE ACADEMIC YEAR 2008-2009. THE INFORMATION SUBMITTED IS TRUE AND ORIGINAL TO THE BEST OF MY KNOWLEDGE.
__________________ SIGNATURE OF PROJECT CO-ORDINATOR
__________________
SIGNATURE OF COURSE CO-ORDINATOR
________________ PRINCIPAL
-3-
PARASITIC MARKETING IN INDIA
ACKNOWLEDGEMENT
During The Perseverance Of This Project, I Was Supported By Different People, Whose Names If Not Mentioned Would Be Inconsiderate On My Part. I Would Like To Extend My Sincere Gratitude And Appreciation To Prof. Mr. Mayur Vyas Who Initiated Me Into The Study Of “PARASITIC MARKETING”. It Has Indeed Been A Great Experience Working Under Her During The Course Of The Project For Her Invaluable Advice And Guidance Provided Through Out This Project. I Also Owe My Sincere Gratitude To Ms. Geetha Mohan Principal Of Our College. I Would Also Like To Give My Sincere Gratitude To All My College Librarian Staff Because Of Whom I Am Able To Complete My Dream Project.
-4-
PARASITIC MARKETING IN INDIA
PREFACE
It gives me immense pleasure to present this project on Parasitic Marketing to the readers. Parasitic marketing is very systematic and planned effort by an organization to associate themselves not directly with an event in order to get at least some of the recognition and benefits that are associated with being an official sponsor. Parasitic marketing takes place when a corporate firm is looking forward to utilize publicity value of an event. Parasitic marketing is related to setting up some activity, which helps in making use of event and interest in it, rather than shelling out for direct sponsorship. Parasitic marketing is something that is happening, every time during the major sports events. The major involvement is taken by the cola companies like Pepsi and Coco Cola where as companies like Nike and Reebok have their own Parasitic marketing strategies. This project covers the story of almost all the major players with the event examples and appropriate case studies. Hope this project proves to be of some help in the near future to the readers.
-5-
PARASITIC MARKETING IN INDIA
SYNOPSIS
Parasitic life means dependent life. The ambush or parasitic marketing is the marketing which take the advantage of value of publicity of major event specifically sports event without paying the requisite fee and being the official sponsor. It has affected world cup football, World cup cricket and Olympics in a big way. Other events also got affected.
As in biology, parasite means those living organisms that live on food made by other living creatures.
Parasitic marketing means taking the advantage of value of a major event publicity i. e. that product or company live on food made by other events. It is also referred as Ambush marketing. Marketing guru Jerry Welsh has first coined the word Ambush marketing as a situation in which a company or product seeks to ride on the publicity values of a major event without having to finance the event through sponsorship. Ambush Marketing means when companies try to pass themselves off as official sponsors when they are not. Most of the advertisements are done during major sporting events. Companies begin to advertise nationwide. Another way Ambush marketing explained is pretending to be a sponsor of a major sporting events but actually not being a sponsor i.e. without paying requisite fees. Ambush or parasitic marketing can be classified in two classes. 1. Direct ambush marketing: In 1994 football world cup, MasterCard received exclusive rights for using world cup logo, but a rival Sprints communication used the logo without permission. This is direct attack but can be defended by laws. 2. Indirect ambush marketing: Several ways indirect ambush marketing can take place like sponsoring the broadcast of the event, sponsoring subcategories of the major event etc.
-6-
PARASITIC MARKETING IN INDIA
LIMITATIONS
This project is an extract of various news-paper articles, websites, books, personal experience.
? Not many people know about Parasitic marketing ? Parasitic marketing is practiced only by the top MNCS ? Also in top MNCS decision of Parasitic marketing is taken by the top marketing managers ? Consultation work have been done for the project purpose but Parasitic Marketing is just a unknown term for majority of them ? Because of the above mention reason data from companies and the consumers or the local people is not possible
But sincere effort has been taken to complete the project and to make reader understand the term parasitic marketing
-7-
PARASITIC MARKETING IN INDIA
INDEX
Section
I
Topic
1 2 3 4
Title
AN INTRODUCTION TO CORPORATE SPONSORSHIP CORPORATE SPONSORSHIP PROCESS OF CORPORATE SPONSORSHIP BENEFITS OF CORPORATE SPONSORSHIP DRAWBACKS AND THREATS OF CORPORATE SPONSORSHIP
Page. No
9 10 11 – 12 13 – 14 15 - 16
II
5 6 7
PARASITIC MARKETING: ARE YOU THERE WHEN YOU ARE NOT PARASITIC MARKETING PARASITIC MARKETING: HOW TO GO ABOUT IT THE ESSENTIALS OF PARASITIC MARKETING
17 18 – 20 21 – 23 24 – 25
III
8 9
THE MASTERS OF PARASITIC MARKETING PEPSI, VODAFONE & NIKE: THEY JUST DO IT. COUNTERING PARASITIC MARKETING THE DANGEROUS GAME {PARASITIC MKTG. AT VARIOUS SPORTS EVENTS} 10 PARASITIC MARKETING AT VARIOUS POPULAR SPORTS EVENTS
26 27 – 31
32 – 34
IV
35
36 – 45
V
PROS CONS AND LEGALITIES -8-
46
PARASITIC MARKETING IN INDIA
11 12 13
THE LEGAL ASPECTS OF PARASITIC MARKETING POINTS IN FAVOUR OF PARASITIC MARKETING POINTS AGAINST PARASITIC MARKETING CASE STUDIES
47 – 50 51 52 53 54 – 61 61 – 66
VI
14 15
CASE STUDIES: PARASITIC MARKETING AND RELATED ASPECTS ANNEXURE 1
16
REFERENCES
67
-9-
PARASITIC MARKETING IN INDIA
SECTION I
AN INTRODUCTION TO CORPORATE SPONSORSHIP
- 10 -
PARASITIC MARKETING IN INDIA
1. CORPORATE SPONSORSHIP
Corporate sponsorship can be defined as: "Corporate Sponsorship means associating a company or a company's brand with an Event to reap benefits associated with that particular event. This is done by paying money or making concessions to the Event organizers. This gives the sponsor a right to use the event to market the company or company's brand."
It can also be defined as: "A marketing tool that helps a company to form or enhance its image or market its products or create or enhance the brands of the company by associating itself with an event and using it to do so."
Thus, Corporate sponsorship means using the attention derived by way of the event to benefit the firm and paying money or making concessions for being allowed to do so.
- 11 -
PARASITIC MARKETING IN INDIA
2. THE PROCESS OF CORPORATE SPONSORSHIP
STEP I
Identifying Sponsorship Areas
STEP II
Identifying Sponsorship Details
STEP III
Approaching Corporates
STEP IV
Evaluation of Proposal
STEP V
Negotiations
STEP VI
Signing of Contract
STEP VII
Implementation of Contract Corporate Sponsorship Process
STEP I - Identifying Sponsorship Areas: The Event Organizers identify various categories for sponsorship in addition to the main sponsor and co-sponsors.
STEP II - Identifying Sponsorship Details: The organizers then identify the benefits it can give the sponsors (main sponsors, co-
- 12 -
PARASITIC MARKETING IN INDIA
sponsors and sponsors for various categories) and the price for these benefits. STEP III - Approaching Corporates: The Event organizers then approach the companies it wants to target and which fall under the various categories for sponsoring the event.
STEP IV - Evaluation of the Proposal by Corporate firms The Corporate firm then evaluates the proposal on whether associating with the event would benefit the firm's image and the cost of doing so.
STEP V - Negotiations Negotiations on the terms of the contract, the benefits and the price takes place between the Corporates and the Event Organizers.
STEP VI - Signing the Contract The next step is signing of Contract that lists down the benefits that will be received by both the parties and the rights of the sponsor.
STEP VII - Implementation of Contract The final step is implementation of the contract, which involves association of the sponsors with the event and preventing competitors of the sponsors from using the event signs and symbols for promoting their brand.
- 13 -
PARASITIC MARKETING IN INDIA
3. BENEFITS OF CORPORATE SPONSORSHIP
Corporate sponsorship is beneficial to both the sponsor in attaining its marketing objectives and to the event organizer to make his event happen. 3.1TO THE SPONSOR
Audience awareness: When people are relaxing they can imbibe information faster. This helps the brand message penetrate effectively into the consumer psyche. Image: Sponsorship leads to the brand’s image enhancement by virtue of association with a high profile event. Segment targeting: Sponsorship enables the marketers to target their consumers in an efficient & relevant manner. So if Mercedes Benz wants to reach CEOs, they can do so more efficiently by sponsoring a golf tournament than by advertising on TV. Alternative: Sometimes companies have no other avenue for reaching the masses due to governmental restrictions on advertising etc. (for example many tobacco & alcohol companies cannot directly advertise) Emotional Touch: Sponsoring an event, which is close to the hearts of your target audience, gives an emotional touch to the brand of the sponsor.
- 14 -
PARASITIC MARKETING IN INDIA
3.2 TO THE EVENT ORGANIZER Financial Support: Corporate sponsorship gives a financial support to the event organizer, which makes the event possible. Without the aegis of sponsors most events including the mega events like FIFA's FOOTBALL WORLD CUP would not take place. Gives Credibility: If an event is sponsored by a major and a well reputed Corporate house then it renders credibility to the Event. Helps in Marketing the Event: Event sponsors will go about promoting their association with the event. This will indirectly be of help in the marketing of an event.
- 15 -
PARASITIC MARKETING IN INDIA
4. DRAWBACKS & THREATS OF CORPORATE Every coin has two sides. Along with the benefits attention has to be set on the SPONSORSHIP
Drawbacks associated with an event. 4.1 TO THE EVENT ORGANIZER Dictating Terms: Sponsors when they put money into an event they obviously, expect something in return. Most event organizers face the problem of the sponsor dictating terms. Diversion from the Event: Event organizers are required to display the logos and banners of sponsors. In addition to this, they may have to announce the name of the sponsors on a regular basis (as per the terms of the contract). This may result in a diversion from the actual event. Not many spectators or audiences will like this. Dilution of Control: There is a dilution of Control from the Event Organizers point of view. Sponsors gain more importance than the Event Organizers. 4.2 TO THE SPONSOR
Success related to event: Success of a sponsorship is directly related to the success of the event being sponsored. If the event being sponsored has failed to draw crowd or attention or has been a failure then the sponsors’ brand will suffer.
Audience's reaction: - 16 -
PARASITIC MARKETING IN INDIA
The distraction that is being caused due to the sponsor or his brand may result in an unfavorable reaction from the audience. This may be in contradiction with what the sponsor wanted to achieve with the sponsorship. Price of Sponsorship: The price of Sponsorship has spiraled over the years. It takes millions of Dollars to attain a Sponsorship at a prestigious event like the World Cup Soccer or the Olympics. It cost Kodak $40 million back in 1996 Atlanta Olympics to become a sponsor in its category. Poor Sponsorship Packages: The sponsorship deal in any event is limited to a few assets and rights that can be given to the Sponsor. A sponsor does not have the legal backing nor the protection beyond them. The biggest threat to Corporate Sponsorship - to both the sponsor and the event organizer is PARASITIC MARKETING.
- 17 -
PARASITIC MARKETING IN INDIA
SECTION II
PARASITIC MARKETING:
ARE YOU THERE WHEN YOU ARE NOT
- 18 -
PARASITIC MARKETING IN INDIA
5. PARASITIC MARKETING
5.1 PARASITICH MARKETING: THE CONCEPT The Oxford dictionary defines Ambush as "surprise attack by persons lying concealed." PARASITIC MARKETING IS ANOTHER NAME TO AMBUSH MARKETING Thus, Parasitic marketing can be understood as a surprise attack on an event sponsor by its competitor.
The official definition of Parasitic Marketing can be stated as follows: "Parasitic marketing is the planned effort by an organization to associate themselves indirectly with an event in order to gain at least some of the recognition and benefits that are associated with being an official sponsor"
Parasitic marketing takes place when a trader seeks to utilise the publicity value of an event, for instance - a major sports tournament or a concert, to gain a benefit from it despite, not having any involvement or connection with that event and more particularly, having made no financial contribution to entitle him to derive benefit from it. Ambush marketing is a radical concept, which involves setting up some activity that makes use of the event and the interest in it, rather than shelling out for direct sponsorship. Example: A Pepsi hot air balloon flying above Sharjah, on the day of the Coca Cola Cup Final. - 19 -
PARASITIC MARKETING IN INDIA
5.2 PARASITIC MARKETING: THE TYPES Parasitic marketing can manifest itself in two manners. PARASITIC Marketing
FORGING
INTRUSION
•
FORGING:
Often a major event has a name, logo, or other insignia identifying it. Unauthorized persons use these insignia, or insignia, which are sufficiently similar to the authentic insignia to cause confusion. In this form of parasitic marketing the ambush marketer misleads the public into thinking that he is an authorised sponsor or contributor associated with the event. Example: During the Football World Cup Collins, a beer company used the marks associated with the World Cup and was promoting tickets. FIFA fought the case in an Irish court and won the case against Collins.
- 20 -
PARASITIC MARKETING IN INDIA
•
INTRUSION
In this form of parasitic marketing, the ambush marketer seeks not to suggest a connection with the event but rather to give his own name, trade mark, or other insignia exposure through the medium of the publicity attracted by the event; this is done without any authorization of the event organizer. In this type of parasitic Marketing the Marketer strives to use the event and the attention gained via the event to promote his product. Example: Pepsi during the 2002 FIFA World Cup did not claim that they were supporting the World Cup. However, it used the event to promote their product.
"They don’t support football the way it should be supported, and yet they are promoting an association with it, for example, by having a very nice and clever ad with Sumo wrestlers also involving famous Football stars." - CEO of FIFA Marketing, Patrick Magyar
The Second form of Parasitic Marketing (Intrusion) is more popular with marketers than the First Form (Forging) due to the legal implications of the First Form (Forging) of Parasitic Marketing.
- 21 -
PARASITIC MARKETING IN INDIA
6. PARASITIC MARKETING: HOW TO GO ABOUT IT
Parasitic Marketing does not have a set procedure. However, there is a standard set of procedures followed by companies in the past.
STEP I
Establishing Marketing Objectives
STEP II
Establishing Promotional Strategy
STEP III
Selection of an Event
STEP IV
Why that Event?
STEP V
Willingness to Spend
STEP VI
Implementing How to go about Parasitic Marketing
Step 1: Establish your Marketing Objectives The first step is common to whatever Marketing or Promotional Strategy you adopt. You need to identify the Marketing Objectives of the firm which are based on your overall Corporate Objectives and on which will be based your Marketing Strategy. Such a strategy should include identifying your Target Audience, brand image and brand positioning, etc. - 22 -
PARASITIC MARKETING IN INDIA
Step 2: Establish your Promotional Strategy This involves formulating a strategy for Promoting your brand and achieving the objectives that were set during the previous stage. A decision needs to be made on how to promote your brand; advertising, corporate sponsorship, etc. Step 3: Selection of event After Corporate Sponsorship or using events as a medium of promotion has been identified as a promotional strategy a decision needs to be made on - which event. This stage can be broken into two steps a) Type of Event: Identifying the type of event you want to associate your brand like Sports or Cultural, etc. This is based on your brand positioning objectives. For e.g. Nike has positioned its brand as a Sports brand therefore, it has always been associated with sports event b) Specific Event: After the Event type has been identified a decision needs to be made as to, which particular event should be selected for brand promotion. for e.g. After Nike has identified Sports as the Event type it wants to target, the next step is to select a specific event, like Ice Hockey or Soccer World Cup.
Step 4: Why do you want to associate yourself with the event An obvious question that needs to be asked is - Why do you want to associate your brand with a particular event? Is it essential for your company? Will it give the company the leverage it wants? Do you think that associating your brand whether directly will help you position your brand better? Is it in co-operation with the image you want to create your brand? If the answers to the above questions is yes. Then, the option with you is to either to sponsor the event or to use Parasitic Marketing. - 23 -
PARASITIC MARKETING IN INDIA
Step 5: How much are you willing to spend? This, along with other factors will determine whether Sponsoring an event or Parasite an event is the option to be selected. If you think sponsoring the event is worth the investment and it helps you achieve what you want to achieve from the brand then go ahead with it. However, beware of your competitors who will be trying to Ambush you. If you actually do sponsor the event then ensure there is enough protection against potential Ambushers. However, if you think the investment required in sponsoring the event is not worth it and will not help you achieve what you wanted to, from the event. Then Parasitic marketing might be the best bet available to you.
Step 6: Implementing The last and final step in Parasitic Marketing is Implementing your strategies. Parasitic marketing needs to be creative and the ramifications of your strategy needs to be assessed. Parasitic Marketing does not have a set procedure so, your creativity matters the most. Parasitic Marketing implementation has to have a few essentials.
- 24 -
PARASITIC MARKETING IN INDIA
7. THE ESSENTIALS OF PARASITIC MARKETING
Though Parasitic Marketing does not have a set procedure, there are a few essential things that form part of a successful Marketing Campaign.
? Catch your competitor unawares: Timing of your attack or needs to be precise. Don't give your competitor (Event sponsor) the time to react to your ambush, nor should he be given the time to lobby with the Event organizer to keep a few safeguards in the Event.
? Creativity: Creativity stands for 'Find out new ways of doing the same thing'. Constantly be on the look out for new ideas. Your competitor has the advantage of being officially associated with the event thus, Creativity is the only thing that could give you an edge over your competitor.
? Rope in the Players: If you can't associate your brand with an Event then, the best thing is to associate your brand with the players playing in that Sports Event. Pepsi, during the FIFA WORLD CUP 2002 used the likes of Beckham and Roberto Carlos along with other big names in Football to associate itself with the World Cup. They did it successfully to Ambush the official sponsor Coca Cola.
- 25 -
PARASITIC MARKETING IN INDIA
? Capture media time: Most successful Parasitic Marketing attempts were successful because they captured the media time during, before and after the Event. The likes of Pepsi have been successful because they captured the media time during, before and after the event.
? Don’t play against the law. Play with it: This is the most essential part of a successful Parasitic Marketing. Do not use the logo or symbols or insignia associated with the event to promote your brand. This may lead to legal hassles due to Intellectual Property Rights infringement. Intrusion is the best form of Parasitic marketing that needs to be adopted.
- 26 -
PARASITIC MARKETING IN INDIA
SECTION III THE MASTERS OF PARASITIC MARKETING
{A SPECIAL STUDY OF NIKE, PEPSI & VODAFONE ON THEIR PARASITIC MARKETING TACTICS}
- 27 -
PARASITIC MARKETING IN INDIA
8. PEPSI, VODAFONE & NIKE: THEY JUST DO IT
8.1 PEPSI: YEH DIL MAANGE MORE, AHA!!!
There is 'NOTHING OFFICIAL ABOUT IT' when it comes to Pepsi and its Marketing strategies. Pepsi has been a major contributor of finance to sporting facilities. Pepsi has over the years used Sporting events to promote and enhance its brand image, be it officially (Official sponsor) or unofficially (Parasitic Marketing).
The two major events where Pepsi has successfully resorted to PARASITIC MARKETING have been the ICC CRICKET WORLD CUP in 1996 and the FIFA FOOTBALL WORLD CUP in 2002.
PEPSI AT ICC CRICKET WORLD CUP 1996 Well there is Nothing Official about the fact that Pepsi was present at the ICC CRICKET WORLD CUP 1996 whether, officially or unofficially. Official Sponsor: Coca Cola was the official soft drink of the ICC CRICKET WORLD CUP. Coca Cola started promoting itself as the Official Soft drink of the ICC Cricket World Cup held in India, Pakistan and Sri Lanka.
- 28 -
PARASITIC MARKETING IN INDIA
Ambush Strategy: Pepsi responded to the Coca Cola promotion of the official Soft Drink of the Cricket World Cup, 1996 by carrying out a mega media campaign with the punch line NOTHING OFFICIAL ABOUT IT. To carry out its campaign Pepsi roped in the SACHIN TENDULKAR. The use of Sachin Tendulkar to promote its brand by using the attention gathered because of the event undermined the success of Coca Cola as an Official Sponsor. PEPSI AT FIFA FOOTBALL WORLD CUP, 2002 Pepsi was at its PARASITIC BEST at the FIFA FOOTBALL WORLD CUP, 2002 held in Korea and Japan. Official Sponsor: Millions of Dollars were spent by Coca Cola to get the Official Sponsorship of the FIFA FOOTBALL WORLD CUP, 2002. But at the end of the event Pepsi went with the honours of capturing more attention than Coca Cola got Ambushing Strategy: Pepsi once again used the star power of Major Footballers like David Becham, Roberto Carlos and other well known Footballers. It came up with an innovative idea of a match between the Football Stars and Sumo Wrestlers, the prize for the winner being PEPSI. Though the Sumo Wrestlers won the match, the real winner was Pepsi.
REASON BEHIND Pepsi’s SUCCESS
The main reason behind Pepsi's success at Parasitic Marketing was that it did make any direct reference to the event. It merely used the event to successfully capture audience attention. What made catching attention easier was that it had innovative and creative - 29 -
PARASITIC MARKETING IN INDIA
media campaign and it used the Stars of the event to promote its brand.
- 30 -
PARASITIC MARKETING IN INDIA
8.2 VODAFONE: ADVANTAGE VODAFONE
Marketers always look for creative ideas to capture audience's attention. Imagine, two streakers
running nude in the middle of an exciting Rugby Match. That's exactly what
Vodafone did to try and attract audience's attention. Two streakers bearing the Vodafone logo on their bodies invaded the pitch during the second half of a Rugby match between New Zealand and Australia in Sydney. The streakers ran up to and around New Zealand (All Blacks) player Andrew Mehrtens as he was preparing for a crucial penalty kick.
Though Australia won the match 16-14 the real winner in terms of capturing public attention was VODAFONE. This is a case of Parasitic Marketing as the official sponsor of the event was TELSTRA an Australian Telecom company, which is in direct competition with Vodafone.
- 31 -
PARASITIC MARKETING IN INDIA
8.3 NIKE: JUST DO IT
Nike leads the pack when it comes to Parasitic Marketing. A Swoosh here and a swoosh there. Nike always manages to find a way to use a popular event like the Olympics to promote its brand without actually sponsoring the event in any capacity.
NIKE AT THE BOSTON MARATHON - 1999
Boston Marathon is a 26.2 mile marathon race. One such race took place on April 19, 1999. Adidas was the official footwear sponsor of the event. Adidas had put up hoardings all over the race track. However, Nike came up with an innovative strategy, which involved having a billboard at the subway tunnel, which fell in the path of the race track. Nike had used loads of dirty socks and had painted the Nike Swoosh and the event date on it. The hit and run campaign included the use of slogan - right down to the dirty socks.
- 32 -
PARASITIC MARKETING IN INDIA
NIKE AT FOOTBALL WORLD CUP - 2002
Nike during the World Cup invested in some kind of five-a-side event, as well as putting electronic score displays with instant updates on the sides of buses.
NIKE DURING SALT LAKE CITY - 2002
Nike during the Salt Lake City 2002 Winter Olympics sponsored the teams participating in the Salt Lake City Ice Hockey Event.
NIKE AT OLYMPICS In past years, the Olympics have been a playground for Parasitic marketing techniques. For example, Nike, not an official sponsor of the 1996 Summer Olympics, constructed a building overlooking the Olympic Park to associate themselves with the festivities of the Olympic Games.
- 33 -
PARASITIC MARKETING IN INDIA
9. COUNTERING PARASITIC MARKETING
? CONTROL MEDIA ADVERTISING The complete right of an event is with the organizers of the event. Television rights are given a Television Company (on paying a fee) by the event organizers. Therefore, the organizers should try and put a clause in the contract with the broadcasting company refraining them from airing the advertisements of competitors of official sponsors. This needs to be done because most of Parasitic marketing is done through media and broadcasting companies. Therefore, if this can controlled then Parasitic marketing can be kept in check.
? CONTROL PLACEMENT OF HOARDINGS AND BOOTHS IN AND AROUND THE EVENT LOCATION Nike, during the Los Angeles Olympics in 1984 erected huge wall murals near the Los Angeles Coliseum, which prominently displayed Nike track and field athletes. Another strategy used by ambushers is to use illustrations or photographs of places, buildings, etc, that are associated with an event in advertising as background to the ambusher's product. This undermines the image that the sponsor wants to enhance with respect to the event. The event organizers (especially the big ones) should control the area in and around the event to counter such strategies.
- 34 -
PARASITIC MARKETING IN INDIA
? STOP THE PLAYERS FROM PROMOTING THE AMBUSHERS BRAND The International Cricket Council (ICC) stopped the players of participating nations from promoting the brand of competitors of the official sponsors a month before, during and a month after the event. This created a row between the organizers (ICC) and the players. The terms of contract were then settled to during the event and 17 days after the event no player was allowed to advertise for any rival company of the sponsor.
? TAKE ACTION Action needs to be taken, wherever possible, against the companies that use the Event logos or symbols or insignia to promote its brand or for those who violate the Intellectual Property rights. More acts should be developed to ensure the protection of sponsors. The United States of America has an act dealing with the violation of such marketing principles as conveying the false message that a company is an official sponsor or affiliate when, in fact, it is not. If the event organizer isn't intent on taking actions then, the sponsors whose rights are violated should be empowered to do so. ACTIONS AGAINST PARASITE WILL ACT AS A DETERRENT FOR ANY SUCH ACTIONS IN THE FUTURE.
- 35 -
PARASITIC MARKETING IN INDIA
? CREATE AN ANTI AMBUSH CAMPAIGN Event organizers should create an anti Parasite campaign by making ads and PR strategy to renounce Parasitic Marketing strategies. It should also resort to Press Conference renouncing actions of Parasitic Marketers. An awareness programme should be carried out to ensure that the audience are aware of who the actual sponsors are. The campaign should focus on the negative effects such Parasitic Marketing Strategy have on successful conducting of the event. This will act as a deterrent for Parasitic Marketers.
? NO REPRESENTATION OF COMPETITORS WHATSOEVER There should be no representation of competitors (of sponsors) whatsoever, in the event in any form. The players or teams should be stopped from sporting logos of the competitors. Neither should the logo or any mention of the competitor be present in any part of the area where the event takes place. The International Cricket Council (ICC) during its champion’s trophy in Srilanka stopped the Indian Cricket team from sporting the Logo of Sahara group which was a competitor of the official Airline, South African Airline.
- 36 -
PARASITIC MARKETING IN INDIA
SECTION IV THE DANGEROUS GAME
{A SPECIAL STUDY ON PRESENCE OF PARASITIC MARKETING AT
VARIOUS SPORTS EVENTS LIKE OLYMPICS, FOOTBALL, NBA, CRICKET}
- 37 -
PARASITIC MARKETING IN INDIA
10. PARASITIC MARKETING AT VARIOUS POPULAR SPORTS EVENTS
10.1 Parasitic Marketing and the NFL, 1995 Jerry Jones' was the owner of an American Football Club, Dallas Cowboys. His National Football League marketing philosophy - making Parasitic marketing sponsorship pacts with NFL non-sponsors Nike and Coca-Cola Co. The National Football League slapped a $300 million lawsuit on Mr. Jones for his alleged role in Parasitic Marketing.
The actions taken by the NFL prompted American Express Co. to reconsider its multi year deal worth $15-20 millions with Mr. Jones to become a sponsor of Texas Stadium.
During the weeks that followed, NFL Properties, sponsors, and media partners created a television program with Visa USA-Fox teaming up to air it. The program "Call for Quarterbacks" was aired during Fox's prime-time programming. Celebrity quarterbacks were the guest star in the Fox program. A promotional contest preceded the program with Visa running a spot each night.
- 38 -
PARASITIC MARKETING IN INDIA
10.2 Parasitic Marketing and the NBA, 1995 During the 1995 season of NBA marketers from PepsiCo to Burger King Corp. launched high profile sports campaigns without paying the sponsorship money. Official sponsors like Coca-Cola Co. and McDonald's Corp. did nothing to defend their positions with more powerful tie-ins or re-evaluation to their sponsorships altogether. Taco Bell took advantage of the National Basketball Association labor dispute to organize a pay-per-view bout between endorser Shaquille O'Neal and Hakeem Olajuwon. Taco Bell hinted at a live match up months ago starting the two NBA centers in a TV spot months ago. The two stars competed for a $1 million prize late in the year. The event also had place for secondary sponsorship positions, including Shaq's footwear sponsor. Reebok International and Spalding Sports Worldwide, which had endorsement deals with both stars, were also involved. Taco Bell also sold specially priced food packages and gave away collectors cups. Taco Bell also did the re-broadcasting of the event and also sold it on video.
10. 3 Lilehammer Winter Olympics, 1994
AMERICAN EXPRESS VS. VISA
In the 1994 Winter Olympics in Norway, American Express's advertising campaign was "If you're traveling to Lilehammer, you'll need a passport, but you don't need a Visa." Visa was the official sponsor of those Olympic Games.
- 39 -
PARASITIC MARKETING IN INDIA
10. 4 SALT LAKE CITY - 2002
NIKE: IT JUST DOES IT
At Salt Lake City, 2002 (Winter Olympics held in Salt Lake City, USA) marketing games are played with as much vigour as real games. Despite, Nike not being an official sponsor for the games every hockey team at the Games is outfitted from head to toe, inside and out, by Nike.
Nike Ambushing Adidas at Salt Lake City
With, the cost of sponsorship ranging from $5 million to $50 million (depending on the level of
sponsorship and coverage). Nike did not have to pay anything for the sponsorship yet the coverage it got out of athletes sporting Nike swoosh was more than what any official sponsor would hope to get out of an event. A survey conducted by MSNBC among spectators revealed that people conceived Nike to be the sponsor of the games.
Another company that used Parasitic Marketing to get leverage out of the Event was Columbia Sportswear. Columbia Sportswear chose an even cheaper option than the one chosen by Nike. NBC announcers seen broadcasting every evening - sported the logo of Columbia Sportswear on their outfits. This option was cheaper than buying into the Games in an official way and less risky than backing a team or athlete.
- 40 -
PARASITIC MARKETING IN INDIA
10.5 SEOUL OLYMPICS - 1988
AMERICAN EXPRESS
In 1988 Seoul Olympics, American Express promoted medallions supporting an "International Olympic Heritage Committee," something totally unconnected with the Games; then it retouched photos of Seoul's Olympic Stadium from the Asian games to make them resemble the 1988 Olympics 10.6 BARCELONA OLYMPICS - 1992
VISA V/S AMERICAN EXPRESS
In 1992, Visa paid approximately $20 million to sponsor the Summer Olympics in Barcelona, Spain and the Winter Olympics in Albertville, France. In addition, Visa spent millions on a marketing campaign designating itself as the official credit card of the 1992 Olympics. One of Visa's television campaigns made a frontal assault on one of its competitors, American Express (AmEx), by stating “The Olympics don't take American Express."' In response to the Visa commercial, AmEx aired an ad with winter sports athletes telling viewers that "to enjoy the 'fun and games' they 'don't need a Visa."' AmEx intended the commercial to show that many stores, restaurants and hotels in Albertville, France accepted the AmEx card. After this ad aired, Visa claimed that AmEx carried out an ambush marketing strategy. AmEx countered by saying that this charge was unfounded because Visa initiated the confrontation and it was merely setting the record straight.
- 41 -
PARASITIC MARKETING IN INDIA
NIKE, INC. AND REEBOK INTERNATIONAL, LTD.
Another example of ambush marketing or aggressive promotion occurred at the 1992 Barcelona Olympic Games between two sports apparel manufacturers, Nike, Inc. (Nike) and Reebok International, Ltd. (Reebok). At the 1992 Olympic medal ceremonies, athletes wore jackets made by Reebok, an official Olympic sponsor. Nike, however, conducted a highly visible advertising campaign without "paying a penny in Olympic sponsorship fees." Nike held press conferences for Olympic athletes under contract with Nike and additionally displayed large murals of U.S.A. basketball team members on the side of Barcelona buildings. In support of its advertising campaign, Nike Divisional Manager Mark Pilkenton stated "We feel like in any major sporting event, we have the right to come in and give our message as long as we don't interfere with the official proceedings."
- 42 -
PARASITIC MARKETING IN INDIA
10. 7 ATLANTA OLYMPICS - 1996
IBM, AT&T AND XEROX
The Summer Olympics at Atlanta in 1996 saw a clash of interest between the sponsors of the event. IBM occupied a sponsorship category - technology whereas, companies like AT&T and Xerox, were also Olympic sponsors, in the computing and communications area. BellSouth Corp. and Scientific Atlanta
The Games could not restrict parasitic efforts through media as the TV rights commanded a high fee and it was not possible for a Television Network to sell media only to Olympic sponsor, opening the doors to non-sponsors with advertising inspired by Olympic imagery. Networks like NBC, which spent $450 million for the Atlanta Olympics, cannot be expected to sell media slots only to Olympic sponsors, they have to make money back.
The only thing the Olympic organizers could do was to carry out an aggressive public relations campaign against ambushers. They also took help of celebrity endorsers and cross-promotion among sponsors designed to reinforce their official rights holder status. Parasitic Marketing is the "Rosie Ruiz" of the corporate sponsorship, in which an advertiser tries to show up at the finish line of an event without any sweat on its gym shorts. - Darby Coker, Atlanta Committee for the Olympic Games.
- 43 -
PARASITIC MARKETING IN INDIA
KODAK VS. FUJI
Eastman Kodak of Rochester, NY spent about $40 million to be the sole imaging sponsor of the 1996 Games. But Fuji is not the official sponsor of the Olympics that title belonged to arch-rival. In New York, an elaborate display honoring 100 years of track and field was unveiled, featuring past Olympic athletes along side 1996 hopefuls. The exhibit was displayed across the U.S. landing in Atlanta in time for the Summer Olympics. The Exhibit called Images of Excellence is full of photos and cosponsored by Fuji Photo Film of Tokyo.
Fuji also advertised on the radio and on newspaper, to take advantage of the country's strong interest in sports. Fuji also offered a poster series and desk calendar featuring athletes such as Dan O'BRIEN and Michael Johnson, both strong contenders for the Olympic team. According to Darby Coker, director of marketing for the Atlanta Committee for the Olympic Games - "It erodes their ability to raise funds from paying sponsors in the future."
- 44 -
PARASITIC MARKETING IN INDIA
10.8 SYDNEY OLYMPICS - 2000
ANSETT AND QANTAS AIRLINES
In the period leading up to the Sydney Games, both Ansett and Qantas Airlines embarked on marketing campaigns that featured athletes, including Olympic athletes. Qantas television advertisements appeared in high density prior to the Games. These advertisements received considerable airtime and public recognition: At a survey done 42% of all Australian respondents indicated that they thought Qantas was an official sponsor of the Games. Only 15% of the same respondents indicated that they thought Ansett was an official sponsor. Qantas was not an official 2000 Games sponsor. Ansett was an official sponsor. As the Sydney 2000 Games drew nearer Qantas stepped up its advertising campaign. Qantas sponsored both pre-Olympic meets and the Olympic selection trials for the Australian swimming team. The trials were broadcast from the Olympic swimming pool and the broadcast featured the Qantas name and logo. Qantas also sponsored the Bledisloe Cup rugby game between Australia and New Zealand which was held at Stadium Australia - the main stadium for the Olympics. A Qantas "flying kangaroo" logo formed on the arena at Stadium Australia featured prominently in Qantas's advertising. Thus, Qantas was able to establish a link between it and the Olympic Stadium and also between the Australian swimming team and Qantas.. Ansett moved the court against Qantas alleging Ambush marketing. It requested an expedited hearing because of the proximity of the Olympics, which were to start on 15 September. Although the hearing commenced, it settled after several hearing days without a decision from the court. There seems little doubt that Qantas emerged victorious since there was no declaration of infringing conduct or any corrective advertising ordered.
- 45 -
PARASITIC MARKETING IN INDIA
The Qantas advertisements did not feature the Olympic motto, the Olympic symbol, the other Olympic designs or the torch and flame. Similarly, they did not use any of the Sydney 2000 Games indicia. Arguably there may have been a breach of Section 12(1) of the Sydney 2000 Act, which prohibits the use of Sydney 2000 Games images for commercial purposes. However, it is unlikely that the courts will see this type of visual representation as a marketing tactic which, to the reasonable person in the circumstances of the presentation, suggests a connection with the Sydney 2000 Olympic Games. It may, in fact, imply little more than "the encouragement of sporting excellence." The Ian Thorpe incident: Nike was the official clothing supplier for the Australian Olympic team. Thorpe was sponsored by Adidas. At a medal presentation ceremony, the swimmer had his towel draped over the Nike logo on his official team tracksuit. Other incidents There were many other incidents in the Sydney Olympic Games which could amount to Parasitic Marketing. Optus also resorted to Ambush Marketing at the Sydney Olympics (using Cathy Freeman in promotions prior to the beginning of the games). Undermining the importance of Telstra which was the Olympic Sponsor.
- 46 -
PARASITIC MARKETING IN INDIA
10. 9 FIFA WORLD CUP - United States Of America, 1994 In 1994, the United States District Court for the Southern District of New York enjoined Sprint Communications (Sprint) from issuing cards bearing the World Cup mark. In March 1991, the International Soccer League (ISL) entered into an agreement with Mastercard International (Mastercard) which allowed Mastercard to be an official sponsor of the 1994 World Cup. The sponsorship agreement granted Mastercard the exclusive right to use the World Cup'94 trademarks on "All card-based payment and account access devices." Subsequently, in May 1992, Sprint entered into an agreement to become an Official Partner of the 1994 World Cup. This agreement was restrictive and expressly limited Official Partners' rights to not "infringe upon the rights of Official Sponsors." Sprint interpreted its Official Partner status to permit the issuance of 100,000 telephone cards bearing the World Cup mark. The district court addressed the issue of contract interpretation, not parasitic marketing. The court held that the Sprint cards fell under the definition of card-based payment and account access devices and prohibited Sprint from using the World Cup logo. Furthermore, the court determined that "extrinsic evidence demonstrated that both Mastercard and ISL intended that Mastercard should have the exclusive right to use the World Cup marks for telephone calling cards." Time Warner Sports Merchandising, the company that licensed official products for the World Cup, took legal action against more than 105 manufacturers, wholesalers and retailers to prevent the sale of counterfeit products. Numerous stories exist detailing the problem of counterfeit goods making their way into the United States, including soccer ball decorations in a New York deli and sweatshirts in Miami. These examples are legally actionable because many of the products are copies of protected trademarks. - 47 -
PARASITIC MARKETING IN INDIA
10. 10 FIFA WORLD CUP – Korea-Japan, 2002
Korea Japan, 2002 saw Coca Cola being Parasitic by its rival Pepsi. Coca Cola had attained the title of Official Soft Drink at Korea-Japan 2002. However, Pepsi during the course of the Event and prior to the event aired Advertisements featuring Top Footballing stars like David Becham, Roberto Carlos, etc. playing a match with Sumo Wrestlers for a PEPSI. The venue was showed as TOKYO, 2002.
10. 11 ICC CRICKET WORLD CUP – INDIA, PAKISTAN, SRI LANKA - 1996
Cricket World Cup of 1996 was the first ever World Cup to witness Parasitic Marketing. Coca Cola was the official Soft Drink of the World Cup. Pepsi responded to this with an extensive Media campaign featuring Sachin Tendulkar with the punch line NOTHING OFFICIAL ABOUT IT.
PARASITIC MARKETING ATTEMPT AT THE 1999 CRICKET WORLD CUP IN ENGLAND WAS AVERTED WHEN PEPSI ASKED THE EVENT ORGANIZERS TO REMOVE COCA COLA LOGOS ON AUSTRALIAN PLAYERS’ KITS.
- 48 -
PARASITIC MARKETING IN INDIA
SECTION V PROS CONS AND LEGALITIES
- 49 -
PARASITIC MARKETING IN INDIA
11. THE LEGAL ASPECTS OF PARASITIC MARKETING
The difficulty with parasitic marketing is that the law is on the side of the parasites. As per the Lanham Act, Parasitic Marketing does not involve counterfeiting or the illegal use of trademarks, tradenames or symbols. Companies simply develop a creative advertising campaign around the event, never use the event logo, trademark or tradename and capitalize by association with the event without paying for official sponsor status. Lawyers can devise strategies for corporate clients that stay on the legal side of the trademark rights dispute. The argument concerning Parasitic Marketing practice revolves around business ethics v/s aggressive advertising. CASE STUDY: NHL vs Pepsi-Cola Canada Ltd. The only case to directly address the contours of ambush marketing is NHL v. PepsiCola Canada Ltd. This case arose out of a Pepsi advertising campaign during the Spring of 1990 called the "Diet Pepsi $4,000,000 Pro Hockey Playoff Pool." This campaign was centered around the National Hockey League (NHL) play off games and the Stanley Cup, but Pepsi was neither an NHL sponsor, nor did it use any NHL official logos. National Hockey League Services (NHLS), the licensing arm of the NHL, entered into an agreement with Coca-Cola Ltd. (Coke) as an official sponsor of the NHL for approximately $2.6 million in the Spring of 1989. Coke obtained the rights to use NHL symbols for its promotional programs in Canada and the United States. - 50 -
PARASITIC MARKETING IN INDIA
Through this agreement, however, Coke did not obtain "any right to advertise during the broadcast in Canada of any televised NHL games." The NHL, not the NHLS, controlled such television rights and it sold them to Molson Breweries of Canada Ltd. (Molson) in 1988 for a five-year period.
By contract with Molson, the Canadian Broadcasting Corporation (CBC) televises what is called Hockey Night in Canada (HNIC), which includes at least one NHL game every Saturday night during the regular season, many of the post- season playoff games and the final Stanley Cup playoff games. Molson sold Pepsi the "right to be the exclusive advertiser of soft drinks during the broadcast of all 'Hockey Night in Canada' games.
In bringing its cause of action, the NHL argued that the Pepsi contest, particularly the television commercials, conveyed a false impression to the public that the NHL, in some form, approved or was associated with the contest. Because there was no breach of the agreement between the NHL and Coke, the NHL sought to establish that Pepsi had interfered with that business relationship. Conversely, Pepsi argued that the contest was "an aggressive but legitimate marketing campaign."
- 51 -
PARASITIC MARKETING IN INDIA
In deciding the issue, the court first described the tort of passing-off as a misrepresentation that "one's business is that of the plaintiff, or connected with that of the plaintiff in any way likely to cause damage." The court then enumerated the elements of the tort of passing off. Applying these elements to the case, the court concluded that there is "nothing that would constitute direct interference by the defendant with the due performance of the NHLS's contractual relationship with Coke." The court continued, stating that although "the NHLS-Coke agreement obligates NHLS, so far as it is able, to protect the rights of Coke from 'Parasitic marketing,"' such an obligation cannot impose a duty upon a third party to refrain from advertising in a manner which, "although aggressive, is not, by the law of Canada, unlawful."
Thus, the court found that Pepsi was not in violation of Coke's contract nor did its aggressive advertising campaign amount to the tort of passing-off under Canadian law or infringe on registered trademarks. To date, this has been the only judicial decision directly addressing the question of ambush marketing. Because this is a Canadian case, it is not at all certain that its rationale will be adopted by American courts. However, it is an understatement to say that this decision supports those seeking to ambush, because it widely opens the doors for ambushers so long as trademark and tradename infringement is not a part of the campaign.
- 52 -
PARASITIC MARKETING IN INDIA
A possible method of attacking the practice of Parasitic marketing in the United States may be found in a false advertising claim under section 43(a) of the Lanham Act. The elements of a prima facie case for an injunction under section 43(a) are that the defendant: (1) Uses a false or misleading (a) Description of fact or (b) Representation of fact; (2) In interstate commerce (3) And in connection with goods or services; (4) In commercial advertising or promotion; (5) When the description or representation misrepresents the nature, qualities, or geographic origin of (a) The defendant's goods, services or commercial activities or (b) The goods, services or commercial activities of another person; (6) And plaintiff has been or is likely to be damaged by these acts. Thus, under this statute, all a plaintiff need prove, in addition to the above-listed elements, is likelihood of damage, because the Lanham Act was designed to protect consumers as well as businesses from the effects of false advertising. While there is no American case on point, at least one scholar argues that ambush advertising which creates a misleading impression of official sponsorship can trigger a violation of section 43(a). During the Sydney Olympics in 2000 the Sydney 2000 Act was passed to protect the sponsors. - 53 -
PARASITIC MARKETING IN INDIA
12. POINTS IN FAVOUR OF PARASITIC MARKETING
? Gives a Level Playing Field Parasitic Marketer opens up an Avenue for Non Sponsors to promote their brand awareness and identity thus giving them a level playing field against their rivals who have attained a high platform by attaining Sponsorship right.
? Competitive Marketing Parasitic marketing according to some analysts is a form of competitive marketing. It keeps the sponsors on their toes and allows for the Consumer to get a complete picture.
? Its my turn This is the argument put forward by Parasitic Marketers, which points out to the fact that every company resorts to such strategy. If I do it today someone else will do it tomorrow.
? Benefits not meeting price Sponsoring an event requires millions of dollars as sponsorship fees. The benefits derived out of such sponsorships are not matched by the benefits derived which are limited in number.
- 54 -
PARASITIC MARKETING IN INDIA
13. POINTS AGAINST PARASITIC MARKETING
? Ethical issue: The argument waged against Parasitic Marketing is that it is against ethical norms to ambush someone who has paid millions of Dollars for recognition as an Olympic Sponsor.
? Financially Detrimental The argument raised by Event Organizers is that Parasitic Marketing will make finding sponsorship difficult in the future and this will be detrimental to the holding of such event in the future.
? Confusion The argument here is that Parasitic Marketers confuse the audience about the Sponsors of the event.
? Not good for Image of the firm The argument being raised is that Parasitic marketing could do more worse than good to the image of the Parasite Marketer if the audience perceives it as an antievent activity.
- 55 -
PARASITIC MARKETING IN INDIA
SECTION VI CASE STUDIES
Zaheer Khan of Indian Cricket team without the Sahara Logo on the Shirt.
- 56 -
PARASITIC MARKETING IN INDIA
14. CASE STUDIES: PARASITIC MARKETING AND RELATED ASPECTS
14.1 CASE 1
PARASITIC MARKETING VS CORPORATE SPONSORSHIP: CASE WORLD CUP 2002
It is with the help of events such as World Cup 2002 that sponsorship industry spend in the Republic of Ireland continues to grow and is expected to reach circa €60m in 2002. National and international brands have invested significantly in seeking to use this powerful platform to make deeper connections with their target consumers. From a sponsor's perspective, this year's World Cup was one of the most competitive yet, with some major battles played out between major brands in an attempt to gain as much bang for their sponsorship buck/ euro as possible in this global sport's arena. On the global stage, the most talked about category battle in terms of 'official sponsors' versus 'Parasitic marketing' was between sportswear giants Adidas (an official FIFA partner for a fee of minimum €15.8m) and Nike - with their highly effective above-theline activity. While the true winners can only be known by the respective brands and their own final evaluation against objectives for the campaigns, some hard facts released by Adidas regarding their return on sponsorship investment clearly illustrate a bottom line benefit to their sponsorship.
- 57 -
PARASITIC MARKETING IN INDIA
•
Adidas hopes to boost Asian sales as a percentage of the total from 15%
to 20% in the next 3 years;
•
Adidas sold 600,000 Japanese national soccer team jerseys, generating a
profit to the company of €24.5 million
•
7 million Adidas World Cup balls were sold…all adding directly to the
bottom line in a financially measurable way. Other wins for Adidas included their sponsoring semi-finalists Turkey and finalists Germany, as well as the finals referee Pierluigi Collina being a participant in Adidas's world cup ad campaign - all ensuring the types of results evident from various sources of consumer research. Consumer brand association research in certain markets tends to share a common finding…overall Nike lost the war to the official sponsor who beat the American giant on awareness levels. For example, UK research by Carat found that Adidas clearly gained a victory overall and in particular with a younger 15-24 age group, by achieving 40% spontaneous awareness versus Nike 30%. Nike was found victors among the 35-44 age group with 23% awareness versus 19% for Adidas. Meanwhile in the soft drinks sector, Coca-Cola - official sponsors - have emerged from various research studies as victors over category rivals Pepsi. In the UK, Coke finished 4 times ahead of rivals Pepsi on spontaneous awareness measures. While sponsorship awareness is only step 1 in achieving sponsorship success, it is certainly a critical one to deliver desired results at a more attitudinal level. Thus, the lessons learned from this year's World Cup would on the surface suggest that Parasitic marketing is no substitute for official sponsorship…but there can be more than one winner if clear objectives are at the centre of a brand's sponsorship strategy.
- 58 -
PARASITIC MARKETING IN INDIA
14.2 CASE 2
PROTECTION AGAINST PARASITIC MARKETING AT VARIOUS EVENTS
1. Efforts taken by IOC to prevent Parasitic Marketing at Salt Lake City: In an effort to clear things up, the IOC is getting very strict about the size and location of all the supplier logos, even the ones on the Columbia jackets, and also keeping nonOlympic companies from using billboards to tout their wares in Salt Lake. The Olympic properties unit of the United States that controls Olympic marketing has bought up all the billboards, which were later sold only to official Olympic sponsors.
2. Protection Programme at Summer Olympics in Atlanta: At the 1996 Summer Olympics, the Atlanta Committee had established a sponsor protection program. The programme was as follows: To present the ambusher with market research within 48 hours of the ad's first appearance, indicating that its advertising is deceiving the public. If the ad is not immediately pulled, to call a press conference announcing the parasite incident. - Running ads in major publications condemning the parasiter for exploiting the Olympic Games without paying the sponsorship fees that are used to pay for, among other things, the training of Olympic athletes.
3. Efforts to Protect Sponsors at Sydney Olympics, 2000: During the Sydney Olympics the Sydney 2000 act was passed to protect the sponsors against Parasitic Marketing. This Act gave the organizers more power to deal with Parasite Marketers. - 59 -
PARASITIC MARKETING IN INDIA
4. Efforts taken by FIFA at 2002 World Cup: Pepsico was ordered to immediately cease the use of an advertisement related to the FIFA World Cup by an Argentinean court on 5 June.
The court found that the prohibited advertisement would cause confusion among consumers as it suggested a "presumed sponsorship relationship" between Pepsico and the FIFA World Cup. The advertisement in question combined the use of the phrase "Tokyo 2002", famous footballers and other football imagery in association with the logo of Pepsico, and the court has ordered Pepsico not to use the ad in TV, printed media or by any other means.
In the wake of the Pepsi ad, in Ecuador, FIFA had instructed counsel to initiate legal proceedings against Pepsico as a result of similar TV commercials. In Mexico, Pepsico is in the midst of negotiations with FIFA to settle a case involving the unauthorised use of the FIFA's trademark-protected emblem of the 2002 FIFA World Cup. Most recently, FIFA has identified a case in Russia which involves similar unauthorised uses of FIFA's trademarks, and FIFA is currently investigating potential actions.
The legal activities against Pepsico's ambush of the event represent a small part of FIFA's worldwide rights protection program. FIFA's rights protection efforts commenced well in advance of the event, beginning with a worldwide trade mark registration programme. The official marks of the event, namely "FIFA World Cup", the Official Mascots, the Official Emblem and the FIFA World Cup Trophy, were protected thanks to worldwide trademark registration. These measures were taken to ensure that FIFA ends up in a strong position to protect its rights and the rights of the Official
- 60 -
PARASITIC MARKETING IN INDIA
14.3 CASE 3
Since the conclusion of the 1998 FIFA World Cup in France, FIFA has been cracking down on manufacturers of unauthorised goods and other companies and individuals attempting to "ambush" the 2002 FIFA World Cup through various parasitic activities. The success of this campaign is the result of considerable efforts on the part of the specialised "anti-parasite" team, comprising trade mark specialists, commercial lawyers and sports marketing specialists based in Switzerland as well as in the two host countries, Korea and Japan. The team put in place a worldwide network of legal experts in intellectual property and event marketing and successfully dealt with hundreds of reports of counterfeiting and illegal use of FIFA marks. These lawyers based in some 80 countries, including many of the areas often associated with the production of counterfeit merchandise, such as Thailand, Pakistan, and Hong Kong. In each of the host countries as well as China, two central legal firms were appointed to deal with infringements. While the tournament was underway, FIFA has also implemented an on-site strategy. During the event, Rights Protection Patrol teams at each of the stadium and around the Host Cities are positioned to protect the rights of FIFA and the Official Partners, Official Suppliers and Licensees. On match days, teams monitored specifically-targeted locations immediately around the stadium, including train and subway stations, to identify any illegal ambush or counterfeit activity and bring it to the attention of the authorities. The teams also work closely with the stadium security and local police to ensure that prohibited marketing items do not enter the stadium. In addition to this, FIFA directed that David Beckham should not be a part of Pepsi campaign and his images were used on Coca Cola cans. - 61 -
PARASITIC MARKETING IN INDIA
STANDOFF BETWEEN ICC AND CRICKET PLAYERS The International Cricket Council (ICC) managed to secure $550 million through a commercial rights agreement for all ICC-run events through 2007, with Global Cricketing Corporation (GCC). The contract included sponsors like, South African Airlines, Hero Honda, Pepsi, LG and others. However, the contract signed by the ICC and GCC had two major clauses: ? One relating to Ambush Marketing which prohibited a player from endorsing products that rivaled those of the official sponsors' for a period of 30 days before and after the tournament and during the tournament. ? The imaging clause, which allowed the official sponsors of the tournament to use images of participating players for up to six months after the event
This contract was signed by the boards of participating countries. However, the players of the Indian Cricketing team rejected to go along with this agreement since, they already had long term commitments with rival companies of those that sponsored the event. Anil Kumble, ace legspinner of Indian Cricket team said it was a matter of Integrity and not Money.
The standoff between the ICC and the Indian players continued for more than 40 days with both the Indian players and the ICC refusing to budge. The governing body for Indian cricket, Board of Control for Cricket in India (BCCI) also agreed to compensate the players for any losses that may occur due to non compliance of their contracts. - 62 -
PARASITIC MARKETING IN INDIA
At a meeting between the Indian Cricket Players and the ICC a common point was met. The new terms of the contract were. - Reducing the duration of the ambush clause from 30 days before and after the event and during the event to 17 days after the event and during the event.
The BCCI however, did not agree to these terms as it made BCCI susceptible to claims of ICC and its sponsors for financial losses. Only after the BCCI got indemnity from such claims did it allow the Indian Players to participate in the agreement.
It was a momentary truce before the tempers between the BCCI and the ICC rose again. The ICC asked the Indian Board to remove the logo of the Indian team sponsor Sahara from the team shirts since; it was considered to be a competitor of South African Airlines who was an official sponsor of the ICC champions’ trophy. Sahara decided to put the name Subrata instead of Sahara on Indian team shirts. However, this too was rejected by the ICC. Zaheer Khan of Indian Cricket team without the Sahara Logo on the Shirt.
Finally, Sahara decided to snap its relations of an official sponsor with the Indian Cricket team.
- 63 -
PARASITIC MARKETING IN INDIA
ANNEXURE I
AN ARTICLE BY THE PERSON WHO COINED THE TERM - AMBUSH MARKETING – JERRY WELSH
A while ago, I accessed the search engine "Google" to see what's new in parasitic Marketing. Surprisingly, I saw page after page of entries on Ambush Marketing, a term I coined years ago when I was at American Express. I was shocked, however, to encounter the mindless drivel that now must be passing for legitimate commentary on Ambush Marketing, which evidently has come to mean -- to some, mostly sports event organizers, I suspect -- something akin to commercial theft. Believing that there is no better time than now to return to the realm of common sense in talking of competitive Marketing, and simultaneously to expose self-serving pleading in the guise of disinterested intellectual commentary, I'm writing this brief piece assaying the origins and principles of Ambush Marketing. The roots of Ambush Marketing can be found in several phenomena typical of modern sponsorships: the escalating prices for, and often the distressed imagery of, category-exclusive sponsorships; in their routinely poor packaging and in their flawed presentation to potential sponsors; and in the increasing level of marketing competition in major categories of consumer products and services. In explaining the practice of Ambush Marketing, and in noting its virtual necessity in modern competitive business practice, and in advocating its desirability -- indeed its inevitability -- there is no need to discuss ethics or - 64 -
PARASITIC MARKETING IN INDIA
morality. Companies routinely compete, mostly, we hope and expect, honestly and hard; and Ambush Marketing, correctly understood and rightly practiced, is an important, ethically correct, competitive tool in a non-sponsoring company's arsenal of business- and image-building-- weapons. To think otherwise is either not to understand -- or willfully to misrepresent -- the meaning of Ambush Marketing and its significance for good -- and winning -- marketing practice. To begin with the unarguably obvious, it is true that, in major sponsorships packaged for sale, there is room for only one company or product in each available category. Event organizers hope to sell their event-sponsoring wares at an auction among major intra-category competitors; after all, that's their game, their core business. Those companies who want to buy, or can afford to buy, often do buy; others must consider their marketing alternatives. Let's acknowledge that, given the already high and continually rising prices for some of these sponsorships, it is hardly surprising that some companies willingly pass on the opportunity to sponsor, and undertake the search for ways to compete in the sponsored space without bearing the onerous costs, and often the heavy burden, of the scandals and other misadventures often associated with large modern sponsored properties, particularly some of those in professional sports. The point to understand is that, in buying a sponsorship, a company buys only that specific, packaged product, offered as it is, with its constituent parts and attendant rights (and its liabilities). In sponsoring, the company does not thereby purchase the rights to all avenues leading to the public's awareness of that property; and, more importantly, the company does not buy the rights to the entire - 65 -
PARASITIC MARKETING IN INDIA
thematic space in which the purchased property is usually only one resident.
In other words, all else other than that which is specifically purchased is up for commercial grabs. That's as it should be in sponsorship and as it is in the larger world of both commerce and life: when you own and license Kermit you have only given the rights you own to one specific frog - not to all frogs, and maybe not even to all green ones. Non-sponsors who are sophisticated about marketing begin by asking themselves the basic question about the thematic space in which the sponsorship exits: "Do I want to be identified with the ideas, images, and events in this sponsored space?" In the case of the Olympics, for example, do I as a non-sponsoring marketer want my products or services identified with this generic space of sport, and more specifically, Olympic-type sporting events? If so, then I begin to look for ways to purchase the imagery and values of the Olympics in properties and events other than those specifically Olympic-sponsored. If my competitor has just spent, say, $100 million to secure the Olympics sponsorship, that gives me roughly the same amount (assuming I want parity in marketing expenditures with my competitor) to get a similar benefit for my product or service without sponsoring the Olympics. So long as I do nothing to claim that I'm indeed an Olympic sponsor, and so long as I refrain from any other action or claim directly misleading to the public, then I'm free to pursue other Olympic-related activities (e.g., television advertising on the Olympics broadcasts, perhaps onsite events, and customer entertainment in the Olympic city), or non-Olympic -- but nevertheless sports-related -- activities and similar sponsorships (national teams, former Olympic athletes, children's athletic causes - 66 -
PARASITIC MARKETING IN INDIA
and programs in Olympic-featured sports) to underscore my company's support of, and dedication to, the thematic space which Olympic sports occupy. The argument that, if I'm an inventive non-sponsor, mining the sponsored thematic space in a clever way, the public may come to think of me as an Olympic sponsor, is not an argument supporting non-ambushing activities, but is rather a possible testament to the marketing skills of a non-sponsoring competitor. What the public perceives in the world of sponsorship is interesting grist for the marketing pollsters, but is hardly the stuff of which business morality should be gauged. Marketers routinely portray their wares in the best possible light; and in times when sponsored properties are on attractive display, the positive association with that thematic space -- if not with the specific sponsored property -- is the natural, and altogether legitimate, inclination of marketing professionals. The contrary notion, put forward largely by sloppy event organizers, that nonsponsors have a moral or ethical obligation to market themselves totally away from the thematic space of a sponsored property, is simply nonsense which smart marketers have long recognized as a commercial non-starter, as well as an intellectual affront. Sponsors have bought a specific property; they have not bought a thematic space. Accordingly, they have no right to police, protect, and otherwise administer what they have not bought, have not created, and, therefore, do not own. Once a sponsorship has been undertaken, then the real marketing games begin, assuming only that non-sponsors want to occupy the thematic space that the sponsors -- by virtue of their having paid the fee -- now occupy. The competitive thinking goes like this: what programs, events, and other similar promotions can one do, within the space, to get the marketing benefits, without having paid the - 67 -
PARASITIC MARKETING IN INDIA
fee for the sponsorship in that space.
What's wrong with that? Where's the "parasitic marketing," to quote a favorite phrase of the putatively aggrieved event organizers and their sponsors? Smart marketing is "parasitic" only to those who foolishly have not sufficiently covered their sponsorships with adequate, anti-competitive bulletproofing. As your competitor, I do not have the ethical obligation to make sure that your sponsorship is successful. I could -- but will not do so here -- argue that the reverse obligation may well be the appropriate ethical and practical stance for me. Ambush Marketing ought to be understood simply as a marketing strategy with its programmatic outcomes, occupying the thematic space of a sponsoring competitor, and formulated to vie with that sponsoring competitor for marketing preeminence. Successful ambush strategies feed on ill-conceived sponsorships and inept sponsors; in that regard, Ambush Marketing is the natural result of healthy competition and has the long-range effect of making sponsored properties more valuable, not less, in that successful ambushes, over time, help to weed out inferior sponsorship propositions. What Ambush Marketing is not, clearly, is some underhanded attempt to take advantage of sponsored properties without paying the associated fees. As I've indicated, the marketing decision around sponsorships involves the trade-off analysis of the sponsorship costs, liabilities, and the extent to which the sponsorship, if purchased, can de defended against successful ambush. This is but another way to ask the simple question of whether or not the sponsorship, as offered, is really commercially viable, or worth anything approximating its cost in the marketplace of available marketing propositions. - 68 -
PARASITIC MARKETING IN INDIA
In the world of modern marketing, sponsor and ambusher are not moral labels to be assigned by the self-appointed arbiters of ethics, but merely the names to be given to two different -- and complementary, if competing -- roles played by competitors vying for consumer loyalty and recognition in the same thematic space. So that is the story of Ambush Marketing. I trust that I won't have to consult "Google!" again in the near future, only to be horrified at what an unrecognizable ogre has been made of my beautiful, conceptual marketing child, Ambush Marketing.
- 69 -
PARASITIC MARKETING IN INDIA
16. REFERENCES
BOOK AND PRINT REFERENCES
?
MARKETING MANAGEMENT- PHILIP KOTLER BUSINESS WORLD, MARCH 2003 BUSINESS INDIA, MARCH 2003 BUSINESS TODAY, MAY 2003 MARKETING EXECUTIVE – ICFAI PRESS. ADVERTISEMENT EXECUTIVE – ICFAI PRESS.
?
?
?
?
?
- 70 -
PARASITIC MARKETING IN INDIA
WEBLIOGRAPHY
?
WWW.GOOGLE.COM WWW.INDIAINFOLINE.COM WWW.MARKETINGMANAGEMENT.COM WWW.CRIINFO.COM WWW.PEPSI.COM WWW.COCACOLA.COM WWW.NIKE.COM WWW.REEBOK.COM
?
?
?
?
?
?
?
PLACES VISITED
INDIAN MERCHANT CHAMBERS - LIBRARY – CHURCHGATE BRITISH COUNCIL LIBRARY – MITTAL CHAMBERS – NARIMAN POINT
- 71 -
doc_368192568.doc
TITLE OF THE PROJECT
“PARASITIC MARKETING”
Name Of The Student Aditya Jajodia TYBMS Roll No. A 34
Name And Address Of The College Usha Pravin Gandhi College of Management Bhaktivedanta Swami Marg, Vile Parle (W), Mumbai – 400056
Date Of Submission
15th September, 2008
-1-
PARASITIC MARKETING IN INDIA
DECLARATION
I, MR. ADITYA JAJODIA OF USHA PRAVIN GANDHI COLLEGE OF MANAGEMENT OF T.Y.BMS (SEM 5) HAVE COMPLETED THE PROJECT ON “PARASITIC MARKETING” IN THE ACADEMIC YEAR 2008-2009. THE INFORMATION SUBMITTED IS TRUE AND ORIGINAL TO THE BEST OF MY KNOWLEDGE.
Date: 14TH September, 2008
Signature Of The Student
Place: Mumbai
( ADITYA JAJODIA )
-2-
PARASITIC MARKETING IN INDIA
CERTIFICATE
I, MR. ADITYA JAIN , HEREBY CERTIFY THAT_ADITYA JAJODIA_, OF USHA PRAVIN GANDHI COLLEGE OF MANAGEMENT HAS
COMPLETED THE PROJECT ON “PARASITIC MARKETING” IN THE ACADEMIC YEAR 2008-2009. THE INFORMATION SUBMITTED IS TRUE AND ORIGINAL TO THE BEST OF MY KNOWLEDGE.
__________________ SIGNATURE OF PROJECT CO-ORDINATOR
__________________
SIGNATURE OF COURSE CO-ORDINATOR
________________ PRINCIPAL
-3-
PARASITIC MARKETING IN INDIA
ACKNOWLEDGEMENT
During The Perseverance Of This Project, I Was Supported By Different People, Whose Names If Not Mentioned Would Be Inconsiderate On My Part. I Would Like To Extend My Sincere Gratitude And Appreciation To Prof. Mr. Mayur Vyas Who Initiated Me Into The Study Of “PARASITIC MARKETING”. It Has Indeed Been A Great Experience Working Under Her During The Course Of The Project For Her Invaluable Advice And Guidance Provided Through Out This Project. I Also Owe My Sincere Gratitude To Ms. Geetha Mohan Principal Of Our College. I Would Also Like To Give My Sincere Gratitude To All My College Librarian Staff Because Of Whom I Am Able To Complete My Dream Project.
-4-
PARASITIC MARKETING IN INDIA
PREFACE
It gives me immense pleasure to present this project on Parasitic Marketing to the readers. Parasitic marketing is very systematic and planned effort by an organization to associate themselves not directly with an event in order to get at least some of the recognition and benefits that are associated with being an official sponsor. Parasitic marketing takes place when a corporate firm is looking forward to utilize publicity value of an event. Parasitic marketing is related to setting up some activity, which helps in making use of event and interest in it, rather than shelling out for direct sponsorship. Parasitic marketing is something that is happening, every time during the major sports events. The major involvement is taken by the cola companies like Pepsi and Coco Cola where as companies like Nike and Reebok have their own Parasitic marketing strategies. This project covers the story of almost all the major players with the event examples and appropriate case studies. Hope this project proves to be of some help in the near future to the readers.
-5-
PARASITIC MARKETING IN INDIA
SYNOPSIS
Parasitic life means dependent life. The ambush or parasitic marketing is the marketing which take the advantage of value of publicity of major event specifically sports event without paying the requisite fee and being the official sponsor. It has affected world cup football, World cup cricket and Olympics in a big way. Other events also got affected.
As in biology, parasite means those living organisms that live on food made by other living creatures.
Parasitic marketing means taking the advantage of value of a major event publicity i. e. that product or company live on food made by other events. It is also referred as Ambush marketing. Marketing guru Jerry Welsh has first coined the word Ambush marketing as a situation in which a company or product seeks to ride on the publicity values of a major event without having to finance the event through sponsorship. Ambush Marketing means when companies try to pass themselves off as official sponsors when they are not. Most of the advertisements are done during major sporting events. Companies begin to advertise nationwide. Another way Ambush marketing explained is pretending to be a sponsor of a major sporting events but actually not being a sponsor i.e. without paying requisite fees. Ambush or parasitic marketing can be classified in two classes. 1. Direct ambush marketing: In 1994 football world cup, MasterCard received exclusive rights for using world cup logo, but a rival Sprints communication used the logo without permission. This is direct attack but can be defended by laws. 2. Indirect ambush marketing: Several ways indirect ambush marketing can take place like sponsoring the broadcast of the event, sponsoring subcategories of the major event etc.
-6-
PARASITIC MARKETING IN INDIA
LIMITATIONS
This project is an extract of various news-paper articles, websites, books, personal experience.
? Not many people know about Parasitic marketing ? Parasitic marketing is practiced only by the top MNCS ? Also in top MNCS decision of Parasitic marketing is taken by the top marketing managers ? Consultation work have been done for the project purpose but Parasitic Marketing is just a unknown term for majority of them ? Because of the above mention reason data from companies and the consumers or the local people is not possible
But sincere effort has been taken to complete the project and to make reader understand the term parasitic marketing
-7-
PARASITIC MARKETING IN INDIA
INDEX
Section
I
Topic
1 2 3 4
Title
AN INTRODUCTION TO CORPORATE SPONSORSHIP CORPORATE SPONSORSHIP PROCESS OF CORPORATE SPONSORSHIP BENEFITS OF CORPORATE SPONSORSHIP DRAWBACKS AND THREATS OF CORPORATE SPONSORSHIP
Page. No
9 10 11 – 12 13 – 14 15 - 16
II
5 6 7
PARASITIC MARKETING: ARE YOU THERE WHEN YOU ARE NOT PARASITIC MARKETING PARASITIC MARKETING: HOW TO GO ABOUT IT THE ESSENTIALS OF PARASITIC MARKETING
17 18 – 20 21 – 23 24 – 25
III
8 9
THE MASTERS OF PARASITIC MARKETING PEPSI, VODAFONE & NIKE: THEY JUST DO IT. COUNTERING PARASITIC MARKETING THE DANGEROUS GAME {PARASITIC MKTG. AT VARIOUS SPORTS EVENTS} 10 PARASITIC MARKETING AT VARIOUS POPULAR SPORTS EVENTS
26 27 – 31
32 – 34
IV
35
36 – 45
V
PROS CONS AND LEGALITIES -8-
46
PARASITIC MARKETING IN INDIA
11 12 13
THE LEGAL ASPECTS OF PARASITIC MARKETING POINTS IN FAVOUR OF PARASITIC MARKETING POINTS AGAINST PARASITIC MARKETING CASE STUDIES
47 – 50 51 52 53 54 – 61 61 – 66
VI
14 15
CASE STUDIES: PARASITIC MARKETING AND RELATED ASPECTS ANNEXURE 1
16
REFERENCES
67
-9-
PARASITIC MARKETING IN INDIA
SECTION I
AN INTRODUCTION TO CORPORATE SPONSORSHIP
- 10 -
PARASITIC MARKETING IN INDIA
1. CORPORATE SPONSORSHIP
Corporate sponsorship can be defined as: "Corporate Sponsorship means associating a company or a company's brand with an Event to reap benefits associated with that particular event. This is done by paying money or making concessions to the Event organizers. This gives the sponsor a right to use the event to market the company or company's brand."
It can also be defined as: "A marketing tool that helps a company to form or enhance its image or market its products or create or enhance the brands of the company by associating itself with an event and using it to do so."
Thus, Corporate sponsorship means using the attention derived by way of the event to benefit the firm and paying money or making concessions for being allowed to do so.
- 11 -
PARASITIC MARKETING IN INDIA
2. THE PROCESS OF CORPORATE SPONSORSHIP
STEP I
Identifying Sponsorship Areas
STEP II
Identifying Sponsorship Details
STEP III
Approaching Corporates
STEP IV
Evaluation of Proposal
STEP V
Negotiations
STEP VI
Signing of Contract
STEP VII
Implementation of Contract Corporate Sponsorship Process
STEP I - Identifying Sponsorship Areas: The Event Organizers identify various categories for sponsorship in addition to the main sponsor and co-sponsors.
STEP II - Identifying Sponsorship Details: The organizers then identify the benefits it can give the sponsors (main sponsors, co-
- 12 -
PARASITIC MARKETING IN INDIA
sponsors and sponsors for various categories) and the price for these benefits. STEP III - Approaching Corporates: The Event organizers then approach the companies it wants to target and which fall under the various categories for sponsoring the event.
STEP IV - Evaluation of the Proposal by Corporate firms The Corporate firm then evaluates the proposal on whether associating with the event would benefit the firm's image and the cost of doing so.
STEP V - Negotiations Negotiations on the terms of the contract, the benefits and the price takes place between the Corporates and the Event Organizers.
STEP VI - Signing the Contract The next step is signing of Contract that lists down the benefits that will be received by both the parties and the rights of the sponsor.
STEP VII - Implementation of Contract The final step is implementation of the contract, which involves association of the sponsors with the event and preventing competitors of the sponsors from using the event signs and symbols for promoting their brand.
- 13 -
PARASITIC MARKETING IN INDIA
3. BENEFITS OF CORPORATE SPONSORSHIP
Corporate sponsorship is beneficial to both the sponsor in attaining its marketing objectives and to the event organizer to make his event happen. 3.1TO THE SPONSOR
Audience awareness: When people are relaxing they can imbibe information faster. This helps the brand message penetrate effectively into the consumer psyche. Image: Sponsorship leads to the brand’s image enhancement by virtue of association with a high profile event. Segment targeting: Sponsorship enables the marketers to target their consumers in an efficient & relevant manner. So if Mercedes Benz wants to reach CEOs, they can do so more efficiently by sponsoring a golf tournament than by advertising on TV. Alternative: Sometimes companies have no other avenue for reaching the masses due to governmental restrictions on advertising etc. (for example many tobacco & alcohol companies cannot directly advertise) Emotional Touch: Sponsoring an event, which is close to the hearts of your target audience, gives an emotional touch to the brand of the sponsor.
- 14 -
PARASITIC MARKETING IN INDIA
3.2 TO THE EVENT ORGANIZER Financial Support: Corporate sponsorship gives a financial support to the event organizer, which makes the event possible. Without the aegis of sponsors most events including the mega events like FIFA's FOOTBALL WORLD CUP would not take place. Gives Credibility: If an event is sponsored by a major and a well reputed Corporate house then it renders credibility to the Event. Helps in Marketing the Event: Event sponsors will go about promoting their association with the event. This will indirectly be of help in the marketing of an event.
- 15 -
PARASITIC MARKETING IN INDIA
4. DRAWBACKS & THREATS OF CORPORATE Every coin has two sides. Along with the benefits attention has to be set on the SPONSORSHIP
Drawbacks associated with an event. 4.1 TO THE EVENT ORGANIZER Dictating Terms: Sponsors when they put money into an event they obviously, expect something in return. Most event organizers face the problem of the sponsor dictating terms. Diversion from the Event: Event organizers are required to display the logos and banners of sponsors. In addition to this, they may have to announce the name of the sponsors on a regular basis (as per the terms of the contract). This may result in a diversion from the actual event. Not many spectators or audiences will like this. Dilution of Control: There is a dilution of Control from the Event Organizers point of view. Sponsors gain more importance than the Event Organizers. 4.2 TO THE SPONSOR
Success related to event: Success of a sponsorship is directly related to the success of the event being sponsored. If the event being sponsored has failed to draw crowd or attention or has been a failure then the sponsors’ brand will suffer.
Audience's reaction: - 16 -
PARASITIC MARKETING IN INDIA
The distraction that is being caused due to the sponsor or his brand may result in an unfavorable reaction from the audience. This may be in contradiction with what the sponsor wanted to achieve with the sponsorship. Price of Sponsorship: The price of Sponsorship has spiraled over the years. It takes millions of Dollars to attain a Sponsorship at a prestigious event like the World Cup Soccer or the Olympics. It cost Kodak $40 million back in 1996 Atlanta Olympics to become a sponsor in its category. Poor Sponsorship Packages: The sponsorship deal in any event is limited to a few assets and rights that can be given to the Sponsor. A sponsor does not have the legal backing nor the protection beyond them. The biggest threat to Corporate Sponsorship - to both the sponsor and the event organizer is PARASITIC MARKETING.
- 17 -
PARASITIC MARKETING IN INDIA
SECTION II
PARASITIC MARKETING:
ARE YOU THERE WHEN YOU ARE NOT
- 18 -
PARASITIC MARKETING IN INDIA
5. PARASITIC MARKETING
5.1 PARASITICH MARKETING: THE CONCEPT The Oxford dictionary defines Ambush as "surprise attack by persons lying concealed." PARASITIC MARKETING IS ANOTHER NAME TO AMBUSH MARKETING Thus, Parasitic marketing can be understood as a surprise attack on an event sponsor by its competitor.
The official definition of Parasitic Marketing can be stated as follows: "Parasitic marketing is the planned effort by an organization to associate themselves indirectly with an event in order to gain at least some of the recognition and benefits that are associated with being an official sponsor"
Parasitic marketing takes place when a trader seeks to utilise the publicity value of an event, for instance - a major sports tournament or a concert, to gain a benefit from it despite, not having any involvement or connection with that event and more particularly, having made no financial contribution to entitle him to derive benefit from it. Ambush marketing is a radical concept, which involves setting up some activity that makes use of the event and the interest in it, rather than shelling out for direct sponsorship. Example: A Pepsi hot air balloon flying above Sharjah, on the day of the Coca Cola Cup Final. - 19 -
PARASITIC MARKETING IN INDIA
5.2 PARASITIC MARKETING: THE TYPES Parasitic marketing can manifest itself in two manners. PARASITIC Marketing
FORGING
INTRUSION
•
FORGING:
Often a major event has a name, logo, or other insignia identifying it. Unauthorized persons use these insignia, or insignia, which are sufficiently similar to the authentic insignia to cause confusion. In this form of parasitic marketing the ambush marketer misleads the public into thinking that he is an authorised sponsor or contributor associated with the event. Example: During the Football World Cup Collins, a beer company used the marks associated with the World Cup and was promoting tickets. FIFA fought the case in an Irish court and won the case against Collins.
- 20 -
PARASITIC MARKETING IN INDIA
•
INTRUSION
In this form of parasitic marketing, the ambush marketer seeks not to suggest a connection with the event but rather to give his own name, trade mark, or other insignia exposure through the medium of the publicity attracted by the event; this is done without any authorization of the event organizer. In this type of parasitic Marketing the Marketer strives to use the event and the attention gained via the event to promote his product. Example: Pepsi during the 2002 FIFA World Cup did not claim that they were supporting the World Cup. However, it used the event to promote their product.
"They don’t support football the way it should be supported, and yet they are promoting an association with it, for example, by having a very nice and clever ad with Sumo wrestlers also involving famous Football stars." - CEO of FIFA Marketing, Patrick Magyar
The Second form of Parasitic Marketing (Intrusion) is more popular with marketers than the First Form (Forging) due to the legal implications of the First Form (Forging) of Parasitic Marketing.
- 21 -
PARASITIC MARKETING IN INDIA
6. PARASITIC MARKETING: HOW TO GO ABOUT IT
Parasitic Marketing does not have a set procedure. However, there is a standard set of procedures followed by companies in the past.
STEP I
Establishing Marketing Objectives
STEP II
Establishing Promotional Strategy
STEP III
Selection of an Event
STEP IV
Why that Event?
STEP V
Willingness to Spend
STEP VI
Implementing How to go about Parasitic Marketing
Step 1: Establish your Marketing Objectives The first step is common to whatever Marketing or Promotional Strategy you adopt. You need to identify the Marketing Objectives of the firm which are based on your overall Corporate Objectives and on which will be based your Marketing Strategy. Such a strategy should include identifying your Target Audience, brand image and brand positioning, etc. - 22 -
PARASITIC MARKETING IN INDIA
Step 2: Establish your Promotional Strategy This involves formulating a strategy for Promoting your brand and achieving the objectives that were set during the previous stage. A decision needs to be made on how to promote your brand; advertising, corporate sponsorship, etc. Step 3: Selection of event After Corporate Sponsorship or using events as a medium of promotion has been identified as a promotional strategy a decision needs to be made on - which event. This stage can be broken into two steps a) Type of Event: Identifying the type of event you want to associate your brand like Sports or Cultural, etc. This is based on your brand positioning objectives. For e.g. Nike has positioned its brand as a Sports brand therefore, it has always been associated with sports event b) Specific Event: After the Event type has been identified a decision needs to be made as to, which particular event should be selected for brand promotion. for e.g. After Nike has identified Sports as the Event type it wants to target, the next step is to select a specific event, like Ice Hockey or Soccer World Cup.
Step 4: Why do you want to associate yourself with the event An obvious question that needs to be asked is - Why do you want to associate your brand with a particular event? Is it essential for your company? Will it give the company the leverage it wants? Do you think that associating your brand whether directly will help you position your brand better? Is it in co-operation with the image you want to create your brand? If the answers to the above questions is yes. Then, the option with you is to either to sponsor the event or to use Parasitic Marketing. - 23 -
PARASITIC MARKETING IN INDIA
Step 5: How much are you willing to spend? This, along with other factors will determine whether Sponsoring an event or Parasite an event is the option to be selected. If you think sponsoring the event is worth the investment and it helps you achieve what you want to achieve from the brand then go ahead with it. However, beware of your competitors who will be trying to Ambush you. If you actually do sponsor the event then ensure there is enough protection against potential Ambushers. However, if you think the investment required in sponsoring the event is not worth it and will not help you achieve what you wanted to, from the event. Then Parasitic marketing might be the best bet available to you.
Step 6: Implementing The last and final step in Parasitic Marketing is Implementing your strategies. Parasitic marketing needs to be creative and the ramifications of your strategy needs to be assessed. Parasitic Marketing does not have a set procedure so, your creativity matters the most. Parasitic Marketing implementation has to have a few essentials.
- 24 -
PARASITIC MARKETING IN INDIA
7. THE ESSENTIALS OF PARASITIC MARKETING
Though Parasitic Marketing does not have a set procedure, there are a few essential things that form part of a successful Marketing Campaign.
? Catch your competitor unawares: Timing of your attack or needs to be precise. Don't give your competitor (Event sponsor) the time to react to your ambush, nor should he be given the time to lobby with the Event organizer to keep a few safeguards in the Event.
? Creativity: Creativity stands for 'Find out new ways of doing the same thing'. Constantly be on the look out for new ideas. Your competitor has the advantage of being officially associated with the event thus, Creativity is the only thing that could give you an edge over your competitor.
? Rope in the Players: If you can't associate your brand with an Event then, the best thing is to associate your brand with the players playing in that Sports Event. Pepsi, during the FIFA WORLD CUP 2002 used the likes of Beckham and Roberto Carlos along with other big names in Football to associate itself with the World Cup. They did it successfully to Ambush the official sponsor Coca Cola.
- 25 -
PARASITIC MARKETING IN INDIA
? Capture media time: Most successful Parasitic Marketing attempts were successful because they captured the media time during, before and after the Event. The likes of Pepsi have been successful because they captured the media time during, before and after the event.
? Don’t play against the law. Play with it: This is the most essential part of a successful Parasitic Marketing. Do not use the logo or symbols or insignia associated with the event to promote your brand. This may lead to legal hassles due to Intellectual Property Rights infringement. Intrusion is the best form of Parasitic marketing that needs to be adopted.
- 26 -
PARASITIC MARKETING IN INDIA
SECTION III THE MASTERS OF PARASITIC MARKETING
{A SPECIAL STUDY OF NIKE, PEPSI & VODAFONE ON THEIR PARASITIC MARKETING TACTICS}
- 27 -
PARASITIC MARKETING IN INDIA
8. PEPSI, VODAFONE & NIKE: THEY JUST DO IT
8.1 PEPSI: YEH DIL MAANGE MORE, AHA!!!
There is 'NOTHING OFFICIAL ABOUT IT' when it comes to Pepsi and its Marketing strategies. Pepsi has been a major contributor of finance to sporting facilities. Pepsi has over the years used Sporting events to promote and enhance its brand image, be it officially (Official sponsor) or unofficially (Parasitic Marketing).
The two major events where Pepsi has successfully resorted to PARASITIC MARKETING have been the ICC CRICKET WORLD CUP in 1996 and the FIFA FOOTBALL WORLD CUP in 2002.
PEPSI AT ICC CRICKET WORLD CUP 1996 Well there is Nothing Official about the fact that Pepsi was present at the ICC CRICKET WORLD CUP 1996 whether, officially or unofficially. Official Sponsor: Coca Cola was the official soft drink of the ICC CRICKET WORLD CUP. Coca Cola started promoting itself as the Official Soft drink of the ICC Cricket World Cup held in India, Pakistan and Sri Lanka.
- 28 -
PARASITIC MARKETING IN INDIA
Ambush Strategy: Pepsi responded to the Coca Cola promotion of the official Soft Drink of the Cricket World Cup, 1996 by carrying out a mega media campaign with the punch line NOTHING OFFICIAL ABOUT IT. To carry out its campaign Pepsi roped in the SACHIN TENDULKAR. The use of Sachin Tendulkar to promote its brand by using the attention gathered because of the event undermined the success of Coca Cola as an Official Sponsor. PEPSI AT FIFA FOOTBALL WORLD CUP, 2002 Pepsi was at its PARASITIC BEST at the FIFA FOOTBALL WORLD CUP, 2002 held in Korea and Japan. Official Sponsor: Millions of Dollars were spent by Coca Cola to get the Official Sponsorship of the FIFA FOOTBALL WORLD CUP, 2002. But at the end of the event Pepsi went with the honours of capturing more attention than Coca Cola got Ambushing Strategy: Pepsi once again used the star power of Major Footballers like David Becham, Roberto Carlos and other well known Footballers. It came up with an innovative idea of a match between the Football Stars and Sumo Wrestlers, the prize for the winner being PEPSI. Though the Sumo Wrestlers won the match, the real winner was Pepsi.
REASON BEHIND Pepsi’s SUCCESS
The main reason behind Pepsi's success at Parasitic Marketing was that it did make any direct reference to the event. It merely used the event to successfully capture audience attention. What made catching attention easier was that it had innovative and creative - 29 -
PARASITIC MARKETING IN INDIA
media campaign and it used the Stars of the event to promote its brand.
- 30 -
PARASITIC MARKETING IN INDIA
8.2 VODAFONE: ADVANTAGE VODAFONE
Marketers always look for creative ideas to capture audience's attention. Imagine, two streakers
running nude in the middle of an exciting Rugby Match. That's exactly what
Vodafone did to try and attract audience's attention. Two streakers bearing the Vodafone logo on their bodies invaded the pitch during the second half of a Rugby match between New Zealand and Australia in Sydney. The streakers ran up to and around New Zealand (All Blacks) player Andrew Mehrtens as he was preparing for a crucial penalty kick.
Though Australia won the match 16-14 the real winner in terms of capturing public attention was VODAFONE. This is a case of Parasitic Marketing as the official sponsor of the event was TELSTRA an Australian Telecom company, which is in direct competition with Vodafone.
- 31 -
PARASITIC MARKETING IN INDIA
8.3 NIKE: JUST DO IT
Nike leads the pack when it comes to Parasitic Marketing. A Swoosh here and a swoosh there. Nike always manages to find a way to use a popular event like the Olympics to promote its brand without actually sponsoring the event in any capacity.
NIKE AT THE BOSTON MARATHON - 1999
Boston Marathon is a 26.2 mile marathon race. One such race took place on April 19, 1999. Adidas was the official footwear sponsor of the event. Adidas had put up hoardings all over the race track. However, Nike came up with an innovative strategy, which involved having a billboard at the subway tunnel, which fell in the path of the race track. Nike had used loads of dirty socks and had painted the Nike Swoosh and the event date on it. The hit and run campaign included the use of slogan - right down to the dirty socks.
- 32 -
PARASITIC MARKETING IN INDIA
NIKE AT FOOTBALL WORLD CUP - 2002
Nike during the World Cup invested in some kind of five-a-side event, as well as putting electronic score displays with instant updates on the sides of buses.
NIKE DURING SALT LAKE CITY - 2002
Nike during the Salt Lake City 2002 Winter Olympics sponsored the teams participating in the Salt Lake City Ice Hockey Event.
NIKE AT OLYMPICS In past years, the Olympics have been a playground for Parasitic marketing techniques. For example, Nike, not an official sponsor of the 1996 Summer Olympics, constructed a building overlooking the Olympic Park to associate themselves with the festivities of the Olympic Games.
- 33 -
PARASITIC MARKETING IN INDIA
9. COUNTERING PARASITIC MARKETING
? CONTROL MEDIA ADVERTISING The complete right of an event is with the organizers of the event. Television rights are given a Television Company (on paying a fee) by the event organizers. Therefore, the organizers should try and put a clause in the contract with the broadcasting company refraining them from airing the advertisements of competitors of official sponsors. This needs to be done because most of Parasitic marketing is done through media and broadcasting companies. Therefore, if this can controlled then Parasitic marketing can be kept in check.
? CONTROL PLACEMENT OF HOARDINGS AND BOOTHS IN AND AROUND THE EVENT LOCATION Nike, during the Los Angeles Olympics in 1984 erected huge wall murals near the Los Angeles Coliseum, which prominently displayed Nike track and field athletes. Another strategy used by ambushers is to use illustrations or photographs of places, buildings, etc, that are associated with an event in advertising as background to the ambusher's product. This undermines the image that the sponsor wants to enhance with respect to the event. The event organizers (especially the big ones) should control the area in and around the event to counter such strategies.
- 34 -
PARASITIC MARKETING IN INDIA
? STOP THE PLAYERS FROM PROMOTING THE AMBUSHERS BRAND The International Cricket Council (ICC) stopped the players of participating nations from promoting the brand of competitors of the official sponsors a month before, during and a month after the event. This created a row between the organizers (ICC) and the players. The terms of contract were then settled to during the event and 17 days after the event no player was allowed to advertise for any rival company of the sponsor.
? TAKE ACTION Action needs to be taken, wherever possible, against the companies that use the Event logos or symbols or insignia to promote its brand or for those who violate the Intellectual Property rights. More acts should be developed to ensure the protection of sponsors. The United States of America has an act dealing with the violation of such marketing principles as conveying the false message that a company is an official sponsor or affiliate when, in fact, it is not. If the event organizer isn't intent on taking actions then, the sponsors whose rights are violated should be empowered to do so. ACTIONS AGAINST PARASITE WILL ACT AS A DETERRENT FOR ANY SUCH ACTIONS IN THE FUTURE.
- 35 -
PARASITIC MARKETING IN INDIA
? CREATE AN ANTI AMBUSH CAMPAIGN Event organizers should create an anti Parasite campaign by making ads and PR strategy to renounce Parasitic Marketing strategies. It should also resort to Press Conference renouncing actions of Parasitic Marketers. An awareness programme should be carried out to ensure that the audience are aware of who the actual sponsors are. The campaign should focus on the negative effects such Parasitic Marketing Strategy have on successful conducting of the event. This will act as a deterrent for Parasitic Marketers.
? NO REPRESENTATION OF COMPETITORS WHATSOEVER There should be no representation of competitors (of sponsors) whatsoever, in the event in any form. The players or teams should be stopped from sporting logos of the competitors. Neither should the logo or any mention of the competitor be present in any part of the area where the event takes place. The International Cricket Council (ICC) during its champion’s trophy in Srilanka stopped the Indian Cricket team from sporting the Logo of Sahara group which was a competitor of the official Airline, South African Airline.
- 36 -
PARASITIC MARKETING IN INDIA
SECTION IV THE DANGEROUS GAME
{A SPECIAL STUDY ON PRESENCE OF PARASITIC MARKETING AT
VARIOUS SPORTS EVENTS LIKE OLYMPICS, FOOTBALL, NBA, CRICKET}
- 37 -
PARASITIC MARKETING IN INDIA
10. PARASITIC MARKETING AT VARIOUS POPULAR SPORTS EVENTS
10.1 Parasitic Marketing and the NFL, 1995 Jerry Jones' was the owner of an American Football Club, Dallas Cowboys. His National Football League marketing philosophy - making Parasitic marketing sponsorship pacts with NFL non-sponsors Nike and Coca-Cola Co. The National Football League slapped a $300 million lawsuit on Mr. Jones for his alleged role in Parasitic Marketing.
The actions taken by the NFL prompted American Express Co. to reconsider its multi year deal worth $15-20 millions with Mr. Jones to become a sponsor of Texas Stadium.
During the weeks that followed, NFL Properties, sponsors, and media partners created a television program with Visa USA-Fox teaming up to air it. The program "Call for Quarterbacks" was aired during Fox's prime-time programming. Celebrity quarterbacks were the guest star in the Fox program. A promotional contest preceded the program with Visa running a spot each night.
- 38 -
PARASITIC MARKETING IN INDIA
10.2 Parasitic Marketing and the NBA, 1995 During the 1995 season of NBA marketers from PepsiCo to Burger King Corp. launched high profile sports campaigns without paying the sponsorship money. Official sponsors like Coca-Cola Co. and McDonald's Corp. did nothing to defend their positions with more powerful tie-ins or re-evaluation to their sponsorships altogether. Taco Bell took advantage of the National Basketball Association labor dispute to organize a pay-per-view bout between endorser Shaquille O'Neal and Hakeem Olajuwon. Taco Bell hinted at a live match up months ago starting the two NBA centers in a TV spot months ago. The two stars competed for a $1 million prize late in the year. The event also had place for secondary sponsorship positions, including Shaq's footwear sponsor. Reebok International and Spalding Sports Worldwide, which had endorsement deals with both stars, were also involved. Taco Bell also sold specially priced food packages and gave away collectors cups. Taco Bell also did the re-broadcasting of the event and also sold it on video.
10. 3 Lilehammer Winter Olympics, 1994
AMERICAN EXPRESS VS. VISA
In the 1994 Winter Olympics in Norway, American Express's advertising campaign was "If you're traveling to Lilehammer, you'll need a passport, but you don't need a Visa." Visa was the official sponsor of those Olympic Games.
- 39 -
PARASITIC MARKETING IN INDIA
10. 4 SALT LAKE CITY - 2002
NIKE: IT JUST DOES IT
At Salt Lake City, 2002 (Winter Olympics held in Salt Lake City, USA) marketing games are played with as much vigour as real games. Despite, Nike not being an official sponsor for the games every hockey team at the Games is outfitted from head to toe, inside and out, by Nike.
Nike Ambushing Adidas at Salt Lake City
With, the cost of sponsorship ranging from $5 million to $50 million (depending on the level of
sponsorship and coverage). Nike did not have to pay anything for the sponsorship yet the coverage it got out of athletes sporting Nike swoosh was more than what any official sponsor would hope to get out of an event. A survey conducted by MSNBC among spectators revealed that people conceived Nike to be the sponsor of the games.
Another company that used Parasitic Marketing to get leverage out of the Event was Columbia Sportswear. Columbia Sportswear chose an even cheaper option than the one chosen by Nike. NBC announcers seen broadcasting every evening - sported the logo of Columbia Sportswear on their outfits. This option was cheaper than buying into the Games in an official way and less risky than backing a team or athlete.
- 40 -
PARASITIC MARKETING IN INDIA
10.5 SEOUL OLYMPICS - 1988
AMERICAN EXPRESS
In 1988 Seoul Olympics, American Express promoted medallions supporting an "International Olympic Heritage Committee," something totally unconnected with the Games; then it retouched photos of Seoul's Olympic Stadium from the Asian games to make them resemble the 1988 Olympics 10.6 BARCELONA OLYMPICS - 1992
VISA V/S AMERICAN EXPRESS
In 1992, Visa paid approximately $20 million to sponsor the Summer Olympics in Barcelona, Spain and the Winter Olympics in Albertville, France. In addition, Visa spent millions on a marketing campaign designating itself as the official credit card of the 1992 Olympics. One of Visa's television campaigns made a frontal assault on one of its competitors, American Express (AmEx), by stating “The Olympics don't take American Express."' In response to the Visa commercial, AmEx aired an ad with winter sports athletes telling viewers that "to enjoy the 'fun and games' they 'don't need a Visa."' AmEx intended the commercial to show that many stores, restaurants and hotels in Albertville, France accepted the AmEx card. After this ad aired, Visa claimed that AmEx carried out an ambush marketing strategy. AmEx countered by saying that this charge was unfounded because Visa initiated the confrontation and it was merely setting the record straight.
- 41 -
PARASITIC MARKETING IN INDIA
NIKE, INC. AND REEBOK INTERNATIONAL, LTD.
Another example of ambush marketing or aggressive promotion occurred at the 1992 Barcelona Olympic Games between two sports apparel manufacturers, Nike, Inc. (Nike) and Reebok International, Ltd. (Reebok). At the 1992 Olympic medal ceremonies, athletes wore jackets made by Reebok, an official Olympic sponsor. Nike, however, conducted a highly visible advertising campaign without "paying a penny in Olympic sponsorship fees." Nike held press conferences for Olympic athletes under contract with Nike and additionally displayed large murals of U.S.A. basketball team members on the side of Barcelona buildings. In support of its advertising campaign, Nike Divisional Manager Mark Pilkenton stated "We feel like in any major sporting event, we have the right to come in and give our message as long as we don't interfere with the official proceedings."
- 42 -
PARASITIC MARKETING IN INDIA
10. 7 ATLANTA OLYMPICS - 1996
IBM, AT&T AND XEROX
The Summer Olympics at Atlanta in 1996 saw a clash of interest between the sponsors of the event. IBM occupied a sponsorship category - technology whereas, companies like AT&T and Xerox, were also Olympic sponsors, in the computing and communications area. BellSouth Corp. and Scientific Atlanta
The Games could not restrict parasitic efforts through media as the TV rights commanded a high fee and it was not possible for a Television Network to sell media only to Olympic sponsor, opening the doors to non-sponsors with advertising inspired by Olympic imagery. Networks like NBC, which spent $450 million for the Atlanta Olympics, cannot be expected to sell media slots only to Olympic sponsors, they have to make money back.
The only thing the Olympic organizers could do was to carry out an aggressive public relations campaign against ambushers. They also took help of celebrity endorsers and cross-promotion among sponsors designed to reinforce their official rights holder status. Parasitic Marketing is the "Rosie Ruiz" of the corporate sponsorship, in which an advertiser tries to show up at the finish line of an event without any sweat on its gym shorts. - Darby Coker, Atlanta Committee for the Olympic Games.
- 43 -
PARASITIC MARKETING IN INDIA
KODAK VS. FUJI
Eastman Kodak of Rochester, NY spent about $40 million to be the sole imaging sponsor of the 1996 Games. But Fuji is not the official sponsor of the Olympics that title belonged to arch-rival. In New York, an elaborate display honoring 100 years of track and field was unveiled, featuring past Olympic athletes along side 1996 hopefuls. The exhibit was displayed across the U.S. landing in Atlanta in time for the Summer Olympics. The Exhibit called Images of Excellence is full of photos and cosponsored by Fuji Photo Film of Tokyo.
Fuji also advertised on the radio and on newspaper, to take advantage of the country's strong interest in sports. Fuji also offered a poster series and desk calendar featuring athletes such as Dan O'BRIEN and Michael Johnson, both strong contenders for the Olympic team. According to Darby Coker, director of marketing for the Atlanta Committee for the Olympic Games - "It erodes their ability to raise funds from paying sponsors in the future."
- 44 -
PARASITIC MARKETING IN INDIA
10.8 SYDNEY OLYMPICS - 2000
ANSETT AND QANTAS AIRLINES
In the period leading up to the Sydney Games, both Ansett and Qantas Airlines embarked on marketing campaigns that featured athletes, including Olympic athletes. Qantas television advertisements appeared in high density prior to the Games. These advertisements received considerable airtime and public recognition: At a survey done 42% of all Australian respondents indicated that they thought Qantas was an official sponsor of the Games. Only 15% of the same respondents indicated that they thought Ansett was an official sponsor. Qantas was not an official 2000 Games sponsor. Ansett was an official sponsor. As the Sydney 2000 Games drew nearer Qantas stepped up its advertising campaign. Qantas sponsored both pre-Olympic meets and the Olympic selection trials for the Australian swimming team. The trials were broadcast from the Olympic swimming pool and the broadcast featured the Qantas name and logo. Qantas also sponsored the Bledisloe Cup rugby game between Australia and New Zealand which was held at Stadium Australia - the main stadium for the Olympics. A Qantas "flying kangaroo" logo formed on the arena at Stadium Australia featured prominently in Qantas's advertising. Thus, Qantas was able to establish a link between it and the Olympic Stadium and also between the Australian swimming team and Qantas.. Ansett moved the court against Qantas alleging Ambush marketing. It requested an expedited hearing because of the proximity of the Olympics, which were to start on 15 September. Although the hearing commenced, it settled after several hearing days without a decision from the court. There seems little doubt that Qantas emerged victorious since there was no declaration of infringing conduct or any corrective advertising ordered.
- 45 -
PARASITIC MARKETING IN INDIA
The Qantas advertisements did not feature the Olympic motto, the Olympic symbol, the other Olympic designs or the torch and flame. Similarly, they did not use any of the Sydney 2000 Games indicia. Arguably there may have been a breach of Section 12(1) of the Sydney 2000 Act, which prohibits the use of Sydney 2000 Games images for commercial purposes. However, it is unlikely that the courts will see this type of visual representation as a marketing tactic which, to the reasonable person in the circumstances of the presentation, suggests a connection with the Sydney 2000 Olympic Games. It may, in fact, imply little more than "the encouragement of sporting excellence." The Ian Thorpe incident: Nike was the official clothing supplier for the Australian Olympic team. Thorpe was sponsored by Adidas. At a medal presentation ceremony, the swimmer had his towel draped over the Nike logo on his official team tracksuit. Other incidents There were many other incidents in the Sydney Olympic Games which could amount to Parasitic Marketing. Optus also resorted to Ambush Marketing at the Sydney Olympics (using Cathy Freeman in promotions prior to the beginning of the games). Undermining the importance of Telstra which was the Olympic Sponsor.
- 46 -
PARASITIC MARKETING IN INDIA
10. 9 FIFA WORLD CUP - United States Of America, 1994 In 1994, the United States District Court for the Southern District of New York enjoined Sprint Communications (Sprint) from issuing cards bearing the World Cup mark. In March 1991, the International Soccer League (ISL) entered into an agreement with Mastercard International (Mastercard) which allowed Mastercard to be an official sponsor of the 1994 World Cup. The sponsorship agreement granted Mastercard the exclusive right to use the World Cup'94 trademarks on "All card-based payment and account access devices." Subsequently, in May 1992, Sprint entered into an agreement to become an Official Partner of the 1994 World Cup. This agreement was restrictive and expressly limited Official Partners' rights to not "infringe upon the rights of Official Sponsors." Sprint interpreted its Official Partner status to permit the issuance of 100,000 telephone cards bearing the World Cup mark. The district court addressed the issue of contract interpretation, not parasitic marketing. The court held that the Sprint cards fell under the definition of card-based payment and account access devices and prohibited Sprint from using the World Cup logo. Furthermore, the court determined that "extrinsic evidence demonstrated that both Mastercard and ISL intended that Mastercard should have the exclusive right to use the World Cup marks for telephone calling cards." Time Warner Sports Merchandising, the company that licensed official products for the World Cup, took legal action against more than 105 manufacturers, wholesalers and retailers to prevent the sale of counterfeit products. Numerous stories exist detailing the problem of counterfeit goods making their way into the United States, including soccer ball decorations in a New York deli and sweatshirts in Miami. These examples are legally actionable because many of the products are copies of protected trademarks. - 47 -
PARASITIC MARKETING IN INDIA
10. 10 FIFA WORLD CUP – Korea-Japan, 2002
Korea Japan, 2002 saw Coca Cola being Parasitic by its rival Pepsi. Coca Cola had attained the title of Official Soft Drink at Korea-Japan 2002. However, Pepsi during the course of the Event and prior to the event aired Advertisements featuring Top Footballing stars like David Becham, Roberto Carlos, etc. playing a match with Sumo Wrestlers for a PEPSI. The venue was showed as TOKYO, 2002.
10. 11 ICC CRICKET WORLD CUP – INDIA, PAKISTAN, SRI LANKA - 1996
Cricket World Cup of 1996 was the first ever World Cup to witness Parasitic Marketing. Coca Cola was the official Soft Drink of the World Cup. Pepsi responded to this with an extensive Media campaign featuring Sachin Tendulkar with the punch line NOTHING OFFICIAL ABOUT IT.
PARASITIC MARKETING ATTEMPT AT THE 1999 CRICKET WORLD CUP IN ENGLAND WAS AVERTED WHEN PEPSI ASKED THE EVENT ORGANIZERS TO REMOVE COCA COLA LOGOS ON AUSTRALIAN PLAYERS’ KITS.
- 48 -
PARASITIC MARKETING IN INDIA
SECTION V PROS CONS AND LEGALITIES
- 49 -
PARASITIC MARKETING IN INDIA
11. THE LEGAL ASPECTS OF PARASITIC MARKETING
The difficulty with parasitic marketing is that the law is on the side of the parasites. As per the Lanham Act, Parasitic Marketing does not involve counterfeiting or the illegal use of trademarks, tradenames or symbols. Companies simply develop a creative advertising campaign around the event, never use the event logo, trademark or tradename and capitalize by association with the event without paying for official sponsor status. Lawyers can devise strategies for corporate clients that stay on the legal side of the trademark rights dispute. The argument concerning Parasitic Marketing practice revolves around business ethics v/s aggressive advertising. CASE STUDY: NHL vs Pepsi-Cola Canada Ltd. The only case to directly address the contours of ambush marketing is NHL v. PepsiCola Canada Ltd. This case arose out of a Pepsi advertising campaign during the Spring of 1990 called the "Diet Pepsi $4,000,000 Pro Hockey Playoff Pool." This campaign was centered around the National Hockey League (NHL) play off games and the Stanley Cup, but Pepsi was neither an NHL sponsor, nor did it use any NHL official logos. National Hockey League Services (NHLS), the licensing arm of the NHL, entered into an agreement with Coca-Cola Ltd. (Coke) as an official sponsor of the NHL for approximately $2.6 million in the Spring of 1989. Coke obtained the rights to use NHL symbols for its promotional programs in Canada and the United States. - 50 -
PARASITIC MARKETING IN INDIA
Through this agreement, however, Coke did not obtain "any right to advertise during the broadcast in Canada of any televised NHL games." The NHL, not the NHLS, controlled such television rights and it sold them to Molson Breweries of Canada Ltd. (Molson) in 1988 for a five-year period.
By contract with Molson, the Canadian Broadcasting Corporation (CBC) televises what is called Hockey Night in Canada (HNIC), which includes at least one NHL game every Saturday night during the regular season, many of the post- season playoff games and the final Stanley Cup playoff games. Molson sold Pepsi the "right to be the exclusive advertiser of soft drinks during the broadcast of all 'Hockey Night in Canada' games.
In bringing its cause of action, the NHL argued that the Pepsi contest, particularly the television commercials, conveyed a false impression to the public that the NHL, in some form, approved or was associated with the contest. Because there was no breach of the agreement between the NHL and Coke, the NHL sought to establish that Pepsi had interfered with that business relationship. Conversely, Pepsi argued that the contest was "an aggressive but legitimate marketing campaign."
- 51 -
PARASITIC MARKETING IN INDIA
In deciding the issue, the court first described the tort of passing-off as a misrepresentation that "one's business is that of the plaintiff, or connected with that of the plaintiff in any way likely to cause damage." The court then enumerated the elements of the tort of passing off. Applying these elements to the case, the court concluded that there is "nothing that would constitute direct interference by the defendant with the due performance of the NHLS's contractual relationship with Coke." The court continued, stating that although "the NHLS-Coke agreement obligates NHLS, so far as it is able, to protect the rights of Coke from 'Parasitic marketing,"' such an obligation cannot impose a duty upon a third party to refrain from advertising in a manner which, "although aggressive, is not, by the law of Canada, unlawful."
Thus, the court found that Pepsi was not in violation of Coke's contract nor did its aggressive advertising campaign amount to the tort of passing-off under Canadian law or infringe on registered trademarks. To date, this has been the only judicial decision directly addressing the question of ambush marketing. Because this is a Canadian case, it is not at all certain that its rationale will be adopted by American courts. However, it is an understatement to say that this decision supports those seeking to ambush, because it widely opens the doors for ambushers so long as trademark and tradename infringement is not a part of the campaign.
- 52 -
PARASITIC MARKETING IN INDIA
A possible method of attacking the practice of Parasitic marketing in the United States may be found in a false advertising claim under section 43(a) of the Lanham Act. The elements of a prima facie case for an injunction under section 43(a) are that the defendant: (1) Uses a false or misleading (a) Description of fact or (b) Representation of fact; (2) In interstate commerce (3) And in connection with goods or services; (4) In commercial advertising or promotion; (5) When the description or representation misrepresents the nature, qualities, or geographic origin of (a) The defendant's goods, services or commercial activities or (b) The goods, services or commercial activities of another person; (6) And plaintiff has been or is likely to be damaged by these acts. Thus, under this statute, all a plaintiff need prove, in addition to the above-listed elements, is likelihood of damage, because the Lanham Act was designed to protect consumers as well as businesses from the effects of false advertising. While there is no American case on point, at least one scholar argues that ambush advertising which creates a misleading impression of official sponsorship can trigger a violation of section 43(a). During the Sydney Olympics in 2000 the Sydney 2000 Act was passed to protect the sponsors. - 53 -
PARASITIC MARKETING IN INDIA
12. POINTS IN FAVOUR OF PARASITIC MARKETING
? Gives a Level Playing Field Parasitic Marketer opens up an Avenue for Non Sponsors to promote their brand awareness and identity thus giving them a level playing field against their rivals who have attained a high platform by attaining Sponsorship right.
? Competitive Marketing Parasitic marketing according to some analysts is a form of competitive marketing. It keeps the sponsors on their toes and allows for the Consumer to get a complete picture.
? Its my turn This is the argument put forward by Parasitic Marketers, which points out to the fact that every company resorts to such strategy. If I do it today someone else will do it tomorrow.
? Benefits not meeting price Sponsoring an event requires millions of dollars as sponsorship fees. The benefits derived out of such sponsorships are not matched by the benefits derived which are limited in number.
- 54 -
PARASITIC MARKETING IN INDIA
13. POINTS AGAINST PARASITIC MARKETING
? Ethical issue: The argument waged against Parasitic Marketing is that it is against ethical norms to ambush someone who has paid millions of Dollars for recognition as an Olympic Sponsor.
? Financially Detrimental The argument raised by Event Organizers is that Parasitic Marketing will make finding sponsorship difficult in the future and this will be detrimental to the holding of such event in the future.
? Confusion The argument here is that Parasitic Marketers confuse the audience about the Sponsors of the event.
? Not good for Image of the firm The argument being raised is that Parasitic marketing could do more worse than good to the image of the Parasite Marketer if the audience perceives it as an antievent activity.
- 55 -
PARASITIC MARKETING IN INDIA
SECTION VI CASE STUDIES
Zaheer Khan of Indian Cricket team without the Sahara Logo on the Shirt.
- 56 -
PARASITIC MARKETING IN INDIA
14. CASE STUDIES: PARASITIC MARKETING AND RELATED ASPECTS
14.1 CASE 1
PARASITIC MARKETING VS CORPORATE SPONSORSHIP: CASE WORLD CUP 2002
It is with the help of events such as World Cup 2002 that sponsorship industry spend in the Republic of Ireland continues to grow and is expected to reach circa €60m in 2002. National and international brands have invested significantly in seeking to use this powerful platform to make deeper connections with their target consumers. From a sponsor's perspective, this year's World Cup was one of the most competitive yet, with some major battles played out between major brands in an attempt to gain as much bang for their sponsorship buck/ euro as possible in this global sport's arena. On the global stage, the most talked about category battle in terms of 'official sponsors' versus 'Parasitic marketing' was between sportswear giants Adidas (an official FIFA partner for a fee of minimum €15.8m) and Nike - with their highly effective above-theline activity. While the true winners can only be known by the respective brands and their own final evaluation against objectives for the campaigns, some hard facts released by Adidas regarding their return on sponsorship investment clearly illustrate a bottom line benefit to their sponsorship.
- 57 -
PARASITIC MARKETING IN INDIA
•
Adidas hopes to boost Asian sales as a percentage of the total from 15%
to 20% in the next 3 years;
•
Adidas sold 600,000 Japanese national soccer team jerseys, generating a
profit to the company of €24.5 million
•
7 million Adidas World Cup balls were sold…all adding directly to the
bottom line in a financially measurable way. Other wins for Adidas included their sponsoring semi-finalists Turkey and finalists Germany, as well as the finals referee Pierluigi Collina being a participant in Adidas's world cup ad campaign - all ensuring the types of results evident from various sources of consumer research. Consumer brand association research in certain markets tends to share a common finding…overall Nike lost the war to the official sponsor who beat the American giant on awareness levels. For example, UK research by Carat found that Adidas clearly gained a victory overall and in particular with a younger 15-24 age group, by achieving 40% spontaneous awareness versus Nike 30%. Nike was found victors among the 35-44 age group with 23% awareness versus 19% for Adidas. Meanwhile in the soft drinks sector, Coca-Cola - official sponsors - have emerged from various research studies as victors over category rivals Pepsi. In the UK, Coke finished 4 times ahead of rivals Pepsi on spontaneous awareness measures. While sponsorship awareness is only step 1 in achieving sponsorship success, it is certainly a critical one to deliver desired results at a more attitudinal level. Thus, the lessons learned from this year's World Cup would on the surface suggest that Parasitic marketing is no substitute for official sponsorship…but there can be more than one winner if clear objectives are at the centre of a brand's sponsorship strategy.
- 58 -
PARASITIC MARKETING IN INDIA
14.2 CASE 2
PROTECTION AGAINST PARASITIC MARKETING AT VARIOUS EVENTS
1. Efforts taken by IOC to prevent Parasitic Marketing at Salt Lake City: In an effort to clear things up, the IOC is getting very strict about the size and location of all the supplier logos, even the ones on the Columbia jackets, and also keeping nonOlympic companies from using billboards to tout their wares in Salt Lake. The Olympic properties unit of the United States that controls Olympic marketing has bought up all the billboards, which were later sold only to official Olympic sponsors.
2. Protection Programme at Summer Olympics in Atlanta: At the 1996 Summer Olympics, the Atlanta Committee had established a sponsor protection program. The programme was as follows: To present the ambusher with market research within 48 hours of the ad's first appearance, indicating that its advertising is deceiving the public. If the ad is not immediately pulled, to call a press conference announcing the parasite incident. - Running ads in major publications condemning the parasiter for exploiting the Olympic Games without paying the sponsorship fees that are used to pay for, among other things, the training of Olympic athletes.
3. Efforts to Protect Sponsors at Sydney Olympics, 2000: During the Sydney Olympics the Sydney 2000 act was passed to protect the sponsors against Parasitic Marketing. This Act gave the organizers more power to deal with Parasite Marketers. - 59 -
PARASITIC MARKETING IN INDIA
4. Efforts taken by FIFA at 2002 World Cup: Pepsico was ordered to immediately cease the use of an advertisement related to the FIFA World Cup by an Argentinean court on 5 June.
The court found that the prohibited advertisement would cause confusion among consumers as it suggested a "presumed sponsorship relationship" between Pepsico and the FIFA World Cup. The advertisement in question combined the use of the phrase "Tokyo 2002", famous footballers and other football imagery in association with the logo of Pepsico, and the court has ordered Pepsico not to use the ad in TV, printed media or by any other means.
In the wake of the Pepsi ad, in Ecuador, FIFA had instructed counsel to initiate legal proceedings against Pepsico as a result of similar TV commercials. In Mexico, Pepsico is in the midst of negotiations with FIFA to settle a case involving the unauthorised use of the FIFA's trademark-protected emblem of the 2002 FIFA World Cup. Most recently, FIFA has identified a case in Russia which involves similar unauthorised uses of FIFA's trademarks, and FIFA is currently investigating potential actions.
The legal activities against Pepsico's ambush of the event represent a small part of FIFA's worldwide rights protection program. FIFA's rights protection efforts commenced well in advance of the event, beginning with a worldwide trade mark registration programme. The official marks of the event, namely "FIFA World Cup", the Official Mascots, the Official Emblem and the FIFA World Cup Trophy, were protected thanks to worldwide trademark registration. These measures were taken to ensure that FIFA ends up in a strong position to protect its rights and the rights of the Official
- 60 -
PARASITIC MARKETING IN INDIA
14.3 CASE 3
Since the conclusion of the 1998 FIFA World Cup in France, FIFA has been cracking down on manufacturers of unauthorised goods and other companies and individuals attempting to "ambush" the 2002 FIFA World Cup through various parasitic activities. The success of this campaign is the result of considerable efforts on the part of the specialised "anti-parasite" team, comprising trade mark specialists, commercial lawyers and sports marketing specialists based in Switzerland as well as in the two host countries, Korea and Japan. The team put in place a worldwide network of legal experts in intellectual property and event marketing and successfully dealt with hundreds of reports of counterfeiting and illegal use of FIFA marks. These lawyers based in some 80 countries, including many of the areas often associated with the production of counterfeit merchandise, such as Thailand, Pakistan, and Hong Kong. In each of the host countries as well as China, two central legal firms were appointed to deal with infringements. While the tournament was underway, FIFA has also implemented an on-site strategy. During the event, Rights Protection Patrol teams at each of the stadium and around the Host Cities are positioned to protect the rights of FIFA and the Official Partners, Official Suppliers and Licensees. On match days, teams monitored specifically-targeted locations immediately around the stadium, including train and subway stations, to identify any illegal ambush or counterfeit activity and bring it to the attention of the authorities. The teams also work closely with the stadium security and local police to ensure that prohibited marketing items do not enter the stadium. In addition to this, FIFA directed that David Beckham should not be a part of Pepsi campaign and his images were used on Coca Cola cans. - 61 -
PARASITIC MARKETING IN INDIA
STANDOFF BETWEEN ICC AND CRICKET PLAYERS The International Cricket Council (ICC) managed to secure $550 million through a commercial rights agreement for all ICC-run events through 2007, with Global Cricketing Corporation (GCC). The contract included sponsors like, South African Airlines, Hero Honda, Pepsi, LG and others. However, the contract signed by the ICC and GCC had two major clauses: ? One relating to Ambush Marketing which prohibited a player from endorsing products that rivaled those of the official sponsors' for a period of 30 days before and after the tournament and during the tournament. ? The imaging clause, which allowed the official sponsors of the tournament to use images of participating players for up to six months after the event
This contract was signed by the boards of participating countries. However, the players of the Indian Cricketing team rejected to go along with this agreement since, they already had long term commitments with rival companies of those that sponsored the event. Anil Kumble, ace legspinner of Indian Cricket team said it was a matter of Integrity and not Money.
The standoff between the ICC and the Indian players continued for more than 40 days with both the Indian players and the ICC refusing to budge. The governing body for Indian cricket, Board of Control for Cricket in India (BCCI) also agreed to compensate the players for any losses that may occur due to non compliance of their contracts. - 62 -
PARASITIC MARKETING IN INDIA
At a meeting between the Indian Cricket Players and the ICC a common point was met. The new terms of the contract were. - Reducing the duration of the ambush clause from 30 days before and after the event and during the event to 17 days after the event and during the event.
The BCCI however, did not agree to these terms as it made BCCI susceptible to claims of ICC and its sponsors for financial losses. Only after the BCCI got indemnity from such claims did it allow the Indian Players to participate in the agreement.
It was a momentary truce before the tempers between the BCCI and the ICC rose again. The ICC asked the Indian Board to remove the logo of the Indian team sponsor Sahara from the team shirts since; it was considered to be a competitor of South African Airlines who was an official sponsor of the ICC champions’ trophy. Sahara decided to put the name Subrata instead of Sahara on Indian team shirts. However, this too was rejected by the ICC. Zaheer Khan of Indian Cricket team without the Sahara Logo on the Shirt.
Finally, Sahara decided to snap its relations of an official sponsor with the Indian Cricket team.
- 63 -
PARASITIC MARKETING IN INDIA
ANNEXURE I
AN ARTICLE BY THE PERSON WHO COINED THE TERM - AMBUSH MARKETING – JERRY WELSH
A while ago, I accessed the search engine "Google" to see what's new in parasitic Marketing. Surprisingly, I saw page after page of entries on Ambush Marketing, a term I coined years ago when I was at American Express. I was shocked, however, to encounter the mindless drivel that now must be passing for legitimate commentary on Ambush Marketing, which evidently has come to mean -- to some, mostly sports event organizers, I suspect -- something akin to commercial theft. Believing that there is no better time than now to return to the realm of common sense in talking of competitive Marketing, and simultaneously to expose self-serving pleading in the guise of disinterested intellectual commentary, I'm writing this brief piece assaying the origins and principles of Ambush Marketing. The roots of Ambush Marketing can be found in several phenomena typical of modern sponsorships: the escalating prices for, and often the distressed imagery of, category-exclusive sponsorships; in their routinely poor packaging and in their flawed presentation to potential sponsors; and in the increasing level of marketing competition in major categories of consumer products and services. In explaining the practice of Ambush Marketing, and in noting its virtual necessity in modern competitive business practice, and in advocating its desirability -- indeed its inevitability -- there is no need to discuss ethics or - 64 -
PARASITIC MARKETING IN INDIA
morality. Companies routinely compete, mostly, we hope and expect, honestly and hard; and Ambush Marketing, correctly understood and rightly practiced, is an important, ethically correct, competitive tool in a non-sponsoring company's arsenal of business- and image-building-- weapons. To think otherwise is either not to understand -- or willfully to misrepresent -- the meaning of Ambush Marketing and its significance for good -- and winning -- marketing practice. To begin with the unarguably obvious, it is true that, in major sponsorships packaged for sale, there is room for only one company or product in each available category. Event organizers hope to sell their event-sponsoring wares at an auction among major intra-category competitors; after all, that's their game, their core business. Those companies who want to buy, or can afford to buy, often do buy; others must consider their marketing alternatives. Let's acknowledge that, given the already high and continually rising prices for some of these sponsorships, it is hardly surprising that some companies willingly pass on the opportunity to sponsor, and undertake the search for ways to compete in the sponsored space without bearing the onerous costs, and often the heavy burden, of the scandals and other misadventures often associated with large modern sponsored properties, particularly some of those in professional sports. The point to understand is that, in buying a sponsorship, a company buys only that specific, packaged product, offered as it is, with its constituent parts and attendant rights (and its liabilities). In sponsoring, the company does not thereby purchase the rights to all avenues leading to the public's awareness of that property; and, more importantly, the company does not buy the rights to the entire - 65 -
PARASITIC MARKETING IN INDIA
thematic space in which the purchased property is usually only one resident.
In other words, all else other than that which is specifically purchased is up for commercial grabs. That's as it should be in sponsorship and as it is in the larger world of both commerce and life: when you own and license Kermit you have only given the rights you own to one specific frog - not to all frogs, and maybe not even to all green ones. Non-sponsors who are sophisticated about marketing begin by asking themselves the basic question about the thematic space in which the sponsorship exits: "Do I want to be identified with the ideas, images, and events in this sponsored space?" In the case of the Olympics, for example, do I as a non-sponsoring marketer want my products or services identified with this generic space of sport, and more specifically, Olympic-type sporting events? If so, then I begin to look for ways to purchase the imagery and values of the Olympics in properties and events other than those specifically Olympic-sponsored. If my competitor has just spent, say, $100 million to secure the Olympics sponsorship, that gives me roughly the same amount (assuming I want parity in marketing expenditures with my competitor) to get a similar benefit for my product or service without sponsoring the Olympics. So long as I do nothing to claim that I'm indeed an Olympic sponsor, and so long as I refrain from any other action or claim directly misleading to the public, then I'm free to pursue other Olympic-related activities (e.g., television advertising on the Olympics broadcasts, perhaps onsite events, and customer entertainment in the Olympic city), or non-Olympic -- but nevertheless sports-related -- activities and similar sponsorships (national teams, former Olympic athletes, children's athletic causes - 66 -
PARASITIC MARKETING IN INDIA
and programs in Olympic-featured sports) to underscore my company's support of, and dedication to, the thematic space which Olympic sports occupy. The argument that, if I'm an inventive non-sponsor, mining the sponsored thematic space in a clever way, the public may come to think of me as an Olympic sponsor, is not an argument supporting non-ambushing activities, but is rather a possible testament to the marketing skills of a non-sponsoring competitor. What the public perceives in the world of sponsorship is interesting grist for the marketing pollsters, but is hardly the stuff of which business morality should be gauged. Marketers routinely portray their wares in the best possible light; and in times when sponsored properties are on attractive display, the positive association with that thematic space -- if not with the specific sponsored property -- is the natural, and altogether legitimate, inclination of marketing professionals. The contrary notion, put forward largely by sloppy event organizers, that nonsponsors have a moral or ethical obligation to market themselves totally away from the thematic space of a sponsored property, is simply nonsense which smart marketers have long recognized as a commercial non-starter, as well as an intellectual affront. Sponsors have bought a specific property; they have not bought a thematic space. Accordingly, they have no right to police, protect, and otherwise administer what they have not bought, have not created, and, therefore, do not own. Once a sponsorship has been undertaken, then the real marketing games begin, assuming only that non-sponsors want to occupy the thematic space that the sponsors -- by virtue of their having paid the fee -- now occupy. The competitive thinking goes like this: what programs, events, and other similar promotions can one do, within the space, to get the marketing benefits, without having paid the - 67 -
PARASITIC MARKETING IN INDIA
fee for the sponsorship in that space.
What's wrong with that? Where's the "parasitic marketing," to quote a favorite phrase of the putatively aggrieved event organizers and their sponsors? Smart marketing is "parasitic" only to those who foolishly have not sufficiently covered their sponsorships with adequate, anti-competitive bulletproofing. As your competitor, I do not have the ethical obligation to make sure that your sponsorship is successful. I could -- but will not do so here -- argue that the reverse obligation may well be the appropriate ethical and practical stance for me. Ambush Marketing ought to be understood simply as a marketing strategy with its programmatic outcomes, occupying the thematic space of a sponsoring competitor, and formulated to vie with that sponsoring competitor for marketing preeminence. Successful ambush strategies feed on ill-conceived sponsorships and inept sponsors; in that regard, Ambush Marketing is the natural result of healthy competition and has the long-range effect of making sponsored properties more valuable, not less, in that successful ambushes, over time, help to weed out inferior sponsorship propositions. What Ambush Marketing is not, clearly, is some underhanded attempt to take advantage of sponsored properties without paying the associated fees. As I've indicated, the marketing decision around sponsorships involves the trade-off analysis of the sponsorship costs, liabilities, and the extent to which the sponsorship, if purchased, can de defended against successful ambush. This is but another way to ask the simple question of whether or not the sponsorship, as offered, is really commercially viable, or worth anything approximating its cost in the marketplace of available marketing propositions. - 68 -
PARASITIC MARKETING IN INDIA
In the world of modern marketing, sponsor and ambusher are not moral labels to be assigned by the self-appointed arbiters of ethics, but merely the names to be given to two different -- and complementary, if competing -- roles played by competitors vying for consumer loyalty and recognition in the same thematic space. So that is the story of Ambush Marketing. I trust that I won't have to consult "Google!" again in the near future, only to be horrified at what an unrecognizable ogre has been made of my beautiful, conceptual marketing child, Ambush Marketing.
- 69 -
PARASITIC MARKETING IN INDIA
16. REFERENCES
BOOK AND PRINT REFERENCES
?
MARKETING MANAGEMENT- PHILIP KOTLER BUSINESS WORLD, MARCH 2003 BUSINESS INDIA, MARCH 2003 BUSINESS TODAY, MAY 2003 MARKETING EXECUTIVE – ICFAI PRESS. ADVERTISEMENT EXECUTIVE – ICFAI PRESS.
?
?
?
?
?
- 70 -
PARASITIC MARKETING IN INDIA
WEBLIOGRAPHY
?
WWW.GOOGLE.COM WWW.INDIAINFOLINE.COM WWW.MARKETINGMANAGEMENT.COM WWW.CRIINFO.COM WWW.PEPSI.COM WWW.COCACOLA.COM WWW.NIKE.COM WWW.REEBOK.COM
?
?
?
?
?
?
?
PLACES VISITED
INDIAN MERCHANT CHAMBERS - LIBRARY – CHURCHGATE BRITISH COUNCIL LIBRARY – MITTAL CHAMBERS – NARIMAN POINT
- 71 -
doc_368192568.doc