Barter Plays Major Role In The Olympic Games

Editor's Note:

BarterNews first reported on the role of barter in the Olympics way back in Issue #4, when we looked at the Los Angeles Summer Games. In the recent 2002 Winter Games, held in Salt Lake City, the value-in-kind payments (bartering of products & services for marketing rights) were again huge--totaling roughly $400 million in goods and services--even though the Winter Games are a smaller event than the Summer Games.

In the following story, from Issue #37, we learn of the staggering amount of trading that takes place by major corporations wanting to be affiliated with the Olympic Games. They will provide upwards of $40 million in goods/services for a sponsorship--the right to use the Olympic Logo in their marketing endeavors as well as other business enhancements.

Also evident from this story is the magnitude of barter taking place outside of the commercial barter industry, i.e. trade exchanges and corporate barter companies.

Barter Plays Major Role in the Olympic Games

10,000 Olympians To Compete In 271 Events At 27 Venues...
15,000 Reporters & 35 Billion People (Worldwide) Looking On

Without question, the world's greatest sporting event, held every four years, is the Olympic Games. The Games are held over 17 days and eleven million tickets are sold to spectators. In addition, 35 billion people worldwide watch and listen to some 3,000 hours of live coverage of the 271 events.

We first reported on the 1984 Games in Los Angeles, where the entrepreneurial efforts of Executive Director Peter Ueberroth enabled those Games to show a profit of $223 million.

Such a staggering profit was due in large part to the first-ever large scale bartering effort by Ueberroth and the Los Angeles Olympic Organizing Committee.

Incidentally, such profits were heretofore unheard of. The '84 Games reinforced the power of capitalism (a market economy) considering the previous summer Games, held in Moscow in 1980 cost the communistic government (central planning) an unbelievable $9 billion to stage! (A loss of $9 billion!)

Ueberroth gained global notoriety for his pioneering bartering efforts. It was he who suggested to the LAOOC that the licensing rights (for sponsorships) be significantly increased and then payment be made "in-kind" where the licensees and sponsors would pay with their products and services, instead of cash.

Products and services that, incidentally, were needed to stage the Games, and if not acquired in this creative manner, would have had to been purchased, anyway.

So the merchandising rights--the use of the Olympic logo on a company's product and/or their advertisements, were raised from approximately $200,000 to $4 million. It was a figure that seemed to many at the time, an incredulous fee.

Now 12 years later that $4 million figure is considered a bargain. Given the stature of the Games, elevated to such prominence and the fact that sponsors are looked upon by the nation in such a positive way, today's cost to participate as a licensee/sponsor has skyrocketed, and ranges from $40 million to a low of $10 million.

And the payment remains the same as was instituted back in '84, payment in one's products or services.

Companies are trading upwards of $40 million in goods and services each--10 times the going sponsorship rate at the 1984 Los Angeles Summer Games.

Atlanta Centennial Olympic Properties (ACOP) fashioned the most successful sponsorship program in Olympic history, providing companies the opportunity to align themselves with one of the world's most recognized and admired symbols. At the same time, the sponsors' contributions are providing the U.S. Olympic Team and ACOG the opportunity to showcase the talent of the United States to the world.

Here's a quick overview of barter's role in the Olympic Games in Atlanta this summer:

Ten Centennial Olympic Partners--$10 Million To $20 Million

Nationsbank Corporation will provide banking services for the Olympic Family, including all of the athletes and coaches who will reside in the Olympic Village.

The Home Depot, is one of the country's largest employers in the Olympic Job Opportunities Program, designed to provide athletes with a secure job while allowing necessary time off for training and competitions.

Sara Lee Corporation--through its Champion, Hanes, L'eggs and Playtex brands--will provide the parade and award uniforms for the Olympic Team, provide the uniforms to be worn by the official volunteers participating in the Games, and will outfit the runners as well as the volunteers for the Olympic Torch Relay.

Anheuser-Busch Companies became a Centennial Olympic Games Partner, retaining promotional category exclusivity for malt beverages with its line of quality beers..

IBM Corporation is the worldwide information technology sponsor and will provide computer systems and software, networking, application networking, application development, systems operations, planning and support services, and integrate systems from other companies to manage and run flawlessly the entire information system.

IBM is also helping develop the systems for results, Games management, and Info '96--the general information system for Olympic Family members with electronic mail, news, weather and event results.

McDonald's Corporation became a Centennial Olympic Games Partner in the restaurant category. This marks the 28th year of their Olympic association.

SMH/Swatch (Swiss Corporation for Microelectronics and Watchmaking Industries) of Switzerland became both a Centennial Olympic Games Partner and the official timekeeper for the Games.

AT&T is providing telecommunications equipment and services including telephone sets, private communications switching systems (PBXs), video-phones and desktop video teleconferencing equipment, wiring and cabling for venues, Language Line translation services, voice mail and long distance calling centers for athletes, officials and spectators.

AT&T also offers the AT&T Press Center with working space and facilities for non-accredited media covering the Olympic Games.

Delta Air Lines, the world's third largest airline, is the official airline of the Olympics. They will provide transportation to Atlanta for thousands of athletes, coaches, trainers and fans from around the world.

Motorola, Inc. will continue its 23-year commitment by providing wireless communications equipment to ACOG, the USOC headquarters and USOC training facilities. The two-way radio network, cellular telephones, pagers, computer modems and secure two-way communication equipment will be vital links for the security network and for spectator and Olympic Family transportation.

Ten Worldwide Sponsors--$40 Million

The Coca-Cola Company is the world's largest beverage company operating in nearly 200 countries. Coca-Cola, Sprite, Fanta, Minute Maid, Hi-C, PowerAde and Aquarius are the official soft drinks, juices, juice drinks, and sports drinks of the Olympic Games.

Eastman Kodak Company, which was associated with the first Modern Olympic Games in Athens in 1896, renewed its sponsorship for the third time to provide imaging equipment and supplies to the Olympic family organizations.

Visa International is the official payment system for the Games and for the Olympic Team, and has been named "The Official Card of Atlanta."

Sports Illustrated has been a sponsor of the Olympic Movement since the 1984 Games, and is the official publishing sponsor.

In addition to its Olympic Preview and three Olympic coverage issues, Sports Illustrated will publish, for the first time, a daily magazine throughout the 17 days of the Games as well as a Commemorative edition following the Games and the Official Souvenir Program.

Bausch & Lomb, the official worldwide health care and optic sponsor, renewed its sponsorship for exclusive marketing rights in the following product categories: contact lenses and care products, sunglasses, general eye care products, eyewear frames, sport optics products, and hearing products.

Xerox Corporation has supported the Olympic Games since the introduction of the plain paper copier during the 1964 Winter Games in Austria. Xerox global document processing technology will set the stage in Atlanta for results printing with reports within 3 to 5-minute windows for the media, broadcasters and Olympic officials. And their network production publishers will produce results books within hours of each sport's completion.

Matsushita Electric Industrial Co., of Japan, is the official audio and video sponsor and has been a sponsor since 1988. Their products will help ensure that athletic events at the Games will be effectively broadcast and displayed through the use of state-of-the-art audio-visual technologies.

IBM Corporation has agreed to be the worldwide information technology sponsor for all Olympic Games through the year 2000. They are providing computer systems and software, networking, application development, planning, and support services and integrating systems from many other companies to ensure a seamless performance.

John Hancock Life Insurance Company signed on as the official life insurance sponsor of the Olympic Games and the U.S. Olympic Team, sharing the insurance category with sponsors in the areas of health and property and casualty.

United Parcel Service (UPS) acquired the exclusive rights for international express letter and package delivery services. They will meet the last-minute express delivery needs of the thousands of media representatives who will converge on Atlanta.

UPS created the Athlete Training Assistance Program (ATAP) for UPS employees worldwide who are qualified Olympic hopefuls. ATAP provides flexible work schedules and reduced work hours, along with training, equipment and competition fees, to support UPS employees in their Olympic quest.

Eighteen Olympic Games Sponsors--$5 Million

Sensormatic Electronics Corporation is the official electronic security sponsor and is providing closed-circuit video surveillance systems, access control, and electronic article surveillance for the Games, plus high-tech electronic security systems for USOC headquarters and Olympic training centers.

York International Corporation is providing air conditioning equipment that will be used in the U.S. Olympic training centers, as well as a number of venues for the Games.

Randstad Staffing Services became the first sponsorship in the category of official staffing services. They will address staffing needs for the Games through recruiting, screening, training, and placing people to fill administrative positions through 1996.

BellSouth Corporation signed a sponsorship agreement to provide communications products and services for the Games. They will make available wireline video and data transmission, cellular, local and nationwide paging. BellSouth is also providing information on the Olympic Games in its telephone directories.

Georgia Power Company, as the official power source, is providing electrical services, a computerized mapping system and training development support.

The Blue Cross and Blue Shield Association is the official health insurance sponsor of the U.S. Olympic Team. The association is providing health insurance coverage for employees of ACOG and the USOC, as well as health information programs for visitors to the Games.

Scientific-Atlanta, Inc., is the official broadband television distribution systems sponsor. The company's digital video distribution system will provide 48 channels of video images to more than 15,000 TV monitors at more than 40 Olympic locations. Scientific Atlanta is proud to combine its video contributions with those of BellSouth and Panasonic to create the Olympic SCARLET video network.

Wheel Of Fortune and Jeopardy! are the official game shows of the Olympic Games and the U.S. Olympic Team. This marks the first time in the history of the Games that any regularly scheduled television show has obtained an official designation. Together, Wheel of Fortune and Jeopardy! will air 38 Olympic-themed shows between April and July 1996.

Borg-Warner Security Corporation is the official protective services sponsor, and will provide a wide range of security personnel and services at ACOG headquarters, ACOG-hosted events, and the Games, including uniformed security officers and armored transport.

General Motors Corporation (GM) is the official sponsor domestic car and truck for the Games. Participating divisions are Chevrolet, Pontiac, Buick, Oldsmobile and Cadillac. GM is providing vehicles for use by ACOG and the USOC both before and during the Games.

BMW of North America, as official sponsor of the Games and the U.S. Olympic Team, will provide transportation for officials and dignitaries during the Games. Their motorcycles will serve as marshaling vehicles, and the mountain bikes will be used as recreational transportation by athletes in and around the Olympic Village.

Holiday Inn Worldwide signed an agreement to be the official hotel sponsor of the Games, and the official provider of hotel accommodations for the Olympic Torch Relay.

Avon Products signed an agreement to become the official cosmetics, skin-care and fragrance sponsor of the Olympic Games and of the U.S. Olympic Team.

Avon, whose sales representatives and customers are almost exclusively women, will also become the sole sponsor of a major exhibition at the Olympic Arts Festival entitled The Olympic Woman, which will run from June 23, 1996 throughout the Games. This multi-media exhibition will chronicle the history of women's participation in the Games since 1896.

Nissan Motor Corporation, as an official sponsor, will provide three types of utility vehicles to be used by officials, athletes and Olympic Family members prior to and during the Games.

WorldTravel Partners is the official travel services sponsor of the Games, and manages the travel network which serves as a central resource for ticket holders seeking accommodations, airline and ground transportation services. As part of the agreement, Gray Line of Atlanta becomes the official motorcoach sponsor and provider of private vehicle services, including limousines, executive sedans and shuttle buses.

Texaco, as the official petroleum sponsor of the Games and the Olympic Torch Relay, will supply fuels and lubricants for all Torch Relay support vehicles, as well as the gasoline-powered vehicles of the Games.

American Gas Association will provide natural gas vehicles, natural gas fuel, fueling stations and maintenance operations for the Games. This is the first time in history that a national trade association has become a sponsor. The vehicles will be part of the ACOG fleet of some 5,000 vehicles, and will be an integral component of the Olympic Transportation System.

International Paper, as the official paper and forest products sponsor, will provide lumber and wood products during the final phases of construction at the Olympic venues. They will also provide paper for printing and office use, as well as papers that will be converted to tablets and envelopes, and other uses for the Games.