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«Sponsorship Program Protection Strategies for Special Sport Events: Are Event Organizers Outmaneuvering Ambush Marketers? Steve McKelvey University ...»

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The NCAA guidelines cited above raises the issue of how event organizers can determine what a “reasonable person” might imply as constituting an association between a product or service of a nonsponsor of the NCAA tournament and the NCAA. The answer to this question is rather complicated. The “reasonable person” standard is a legal fiction that originated in the development of the common law.

The “reasonable person” is a hypothetical, rational, reasonably intelligent individual who is intended to represent an “average” citizen. In adopting this standard, the NCAA is essentially saying that if a reasonable person, after seeing the promotion or activity, believes that there is a connection between the promotion and the NCAA tournament, such that the nonsponsor is effectively able to “piggyback” on the event’s reputation and goodwill, this would constitute ambush marketing (except in cases where the First Amendment or other legal defense could be established).

The NCAA’s reasonable person standard is a more simplistic analysis of the hypothetical “reasonable person” viewing the promotion and making a determination if such promotion implies an association between the product or service and the event. As discussed in greater detail below, the “reasonable person” standard has also been incorporated into Australia’s special legislation designed to protect major sporting events in that country.

Contractual Prohibitions in Participant Agreements/Spectator Tickets Another way in which event organizers have limited the potential for ambush marketing activity is through contractual prohibitions inserted in participant agreements and more recently, in spectator ticket back language. An often relied upon loophole by ambush marketers has been the commercial use of athletes with whom the companies have individual endorsement deals. These deals often conflict with the event’s official sponsors. Event organizers have, however, become increasingly savvy in closing this loophole through language in participant agreements. From the sponsor’s perspective, the impetus for such contractual restrictions is a concern is that if nonsponsors of the event are able to use past and future Olympic athletes in their marketing campaigns, this “will lead to an assumption on the part of public that those using them are in fact official sponsors” (Curthoys & Kendall, 2001, p. 31).

Similarly, from the perspective of the event organizers, there is a need for restrictions on athletes “because even where there is an implicit association of endorsement by an... athlete of a non-official sponsor, the return on investment for the official sponsor is likely diminished” (McKelvey & Grady, 2004, p. 213–214).

The ability of individual athletes to provide an ambush marketing avenue for nonsponsors has been most prevalent during high-profile events such as the Sponsorship Program Protection Strategies Olympic Games. However, with each successive games, the Olympic Movement has strengthened its resolve in this area. For example, in response to athletes appearing in nonsponsor advertising during the Games (dating back to the Nike activity during the Atlanta 1996 Games), the IOC enacted a by-law to its Olympic Charter that restricts competitors, coaches, trainers, and official who participate in the Games from “allow[ing] his person, name, picture or sports performances to be used for advertising purposes during the Olympic Games” (Olympic Charter, 2007). This rule is designed to prevent ambush marketers from “capitalizing on their endorsement deals with participants during the period of the Games” (McKelvey & Grady, 2004, p. 214).

The New Zealand Olympic Committee (NZOC) also saw fit to impose restrictions on athletes participating in their 2006 Commonwealth Games. The organization held firm in its position to “vigorously protect its own sponsors against ‘ambush marketing’ and unauthorized use of athlete association with non Commonwealth Games sponsors” (NZOC, n.d.). One such restriction imposed by the Commonwealth Games Federation in London as well as Games organizers in Melbourne required that participating athletes “not allow their person, name, picture, or sports performance to be used for advertising purposes at or during the Games” (NZOC, n.d.). Defending its position on athlete advertising restrictions, NZOC Secretary General Barry Maister stated, “the NZOC is totally dependent on our partners and sponsors to support the organization.... When our financial survival and our ability to deliver the Games experiences are at stake, we will take appropriate action to protect our partners who fund the entire team” (NZOC, n.d.).

Another ambush marketing avenue that event organizers have sought to control is the apparel worn by athletes during their premier events. Professional team sports leagues have historically had few incidents in this area, since onfield appearance is strictly monitored through terms of collective bargaining agreements and league rules. Athletes who violate such rules are subject to heavy penalties. For instance, Chicago Bears linebacker Brian Urlacher was fined $100,000 by the NFL for wearing a cap during the 2007 Super Bowl media day that promoted a sponsor not authorized by the league (Biggs, 2007). Such unauthorized commercial activity has also been largely halted within the Olympic Games by participation agreements that prohibit athletes from displaying any commercial markings on their uniforms other than those authorized by the IOC (Augustine-Schlossinger, 2003).

Those Olympic athletes found in violation of such participation agreements have been subject to serious consequences. In 2005, U.S. speed skater Shani Davis was dropped from the U.S. Speedskating’s national training program after wearing the logo of his individual sponsor, DBS Bank of Europe, rather than that of Qwest, the official sponsor of the U.S. Speedskating team (Tatko-Peterson, 2005). After being warned to stop wearing the logo of DBS Bank, Davis asserted that “[m]y obligation is to my sponsor. I signed a contract with them first” (Tatko-Peterson, 2005). Because of Davis’ unwillingness to wear the Qwest logo, his contract with U.S. Speedskating was terminated (Tatko-Peterson, 2005). The contracts of Olympic speedskaters Derek Parra and Chad Hedrick were also terminated in the past by U.S.

Speedskating for similar instances of noncompliance (Tatko-Peterson, 2005).

In addition to the restrictions placed on participants and coaches, an increasingly common practice to combat ambush marketing is the placement of restrictions on the spectators attending the event. For instance, event organizers of the 572 McKelvey and Grady Sydney 2000 Olympics broke new ground by stating in their ticket conditions that attendees could not engage in ambush marketing... display commercial or offensive signage... sell any goods or services... wear or give away political, advertising or promotional materials... [or] engage in any other activities which [the Sydney Organizing Committee for the Olympic Games] considers dangerous or otherwise inappropriate (Ambush Marketing, 2003).

Similarly worded provisions have subsequently been included in ticket conditions for events including the Cricket World Cup in 2004 and the 2006 FIFA World Cup. One interesting note is that the term “ambush marketing” is not defined, arguably leaving it up to the event organizer to determine what is and is not to be deemed ambush marketing activity regardless of the legality of such activity.

The episode involving the Dutch soccer fans at the 2006 FIFA World Cup, discussed above, provides a good illustration of how the use of ticket back language, while imposing restrictions on spectators, is ultimately aimed at preventing ambush activity from taking place inside the competition venues. “The ticketing terms and conditions for the 2006 World Cup include a provision requiring ticket holders to consent to the confiscation of ‘prohibited items,’” such as pyrotechnics, weapons, and illegal drugs (Johnson, 2006c). The terms on the back of the ticket also stated that “all promotional, commercial, political or religious items of whatever nature, including but not limited to, banners, signs, symbols and leaflets are prohibited and may not be brought into the Stadium if the [Organizing Committee] reasonably believes that any such items may be used for display purposed [sic] within the Stadium” (Johnson, 2006c). While some marketing law experts have debated whether FIFA had the authority to prohibit spectators from wearing the pants of their choice into the venue, the episode demonstrates how even the most clever ambush marketing ploy involving a mass of spectators can be stopped through aggressive on-site policing by event organizers.

The on-site policing measures discussed above, while illustrating the extremes to which event organizers have gone to protect their official sponsors, suggest the importance of this issue to event organizers, as well as the increasing level of demand and expectations being placed upon event organizers by official sponsors in today’s highly competitive sponsorship marketplace. However, they also raise important issues regarding the acceptability and legality of such measures. As event organizers seek to enact stricter controls over the activities of nonsponsors and fans, one is now seeing a backlash among those advocating the need for a balance to be struck between the commercial rights of local businesses and civil rights of fans versus the desires of event organizers and their official sponsors. This tension is currently being played out in the debate over proposed ambush marketing legislation (titled the Major Events Management Bill) for the 2011 Rugby World Cup to be hosted by New Zealand, in which the government “appears to be taking a belts and braces approach to the running of the Rugby World Cup... that has the potential to infringe on public rights” (Glengarry, 2007). The potential loss of civil liberties and private property rights, as well as the rewriting of laws already in place to address potential infringement that would include criminal penalties, should raise serious concerns about the extent to which local governments are “prepared to go Sponsorship Program Protection Strategies in its bid to attract events, and whether anyone other than the sponsors (are) to be permitted to share benefits?” (Glengarry, 2007). Ultimately, it is the responsibility of advocates of local businesses and its citizens to lobby against ambush marketing legislation that would seek to impinge the rights of these constituents while balancing the reasonable desires of event organizers to protect the investment of their official sponsors.

Ambush Protection in the Bid City Process The importance of including protections from ambush marketing in the host city process was highlighted during New York City’s bid for the 2012 Olympic Games, coordinated by a private, nonprofit corporation entitled NYC2012. To successfully bid for the Olympic Games, a city needs to comply with rules established by the IOC.

Each city is thus required to provide its strategy for preventing ambush marketing.

As part of its bid, New York City Mayor, Michael Bloomberg, signed an Executive Order establishing the Mayor’s an Enforcement Board on Olympic Brand Protection to coordinate efforts to prevent ambush marketing (NYC2012 Candidature File, 2004).

The Board’s role included, inter alia, the following tasks:

Manage a comprehensive enforcement program with trained officers regularly inspecting key routes and signage;...

Create and enforce vendor-free zones surrounding Olympic venues and other key locations;...

Coordinate closely with the International Olympic Committee (IOC) and USOC to ensure protection for all international and domestic sponsors; and Work with the Federal Aviation Administration and the NYPD to control airspace and prevent illegal advertising. (NYC2012 Candidature File, 2004, p. 126) In addition to the Mayor’s Enforcement Board, NYC2012 was able to secure 95% of the signage in New York City by entering into option contracts with each of New York City’s major outdoor signage companies (NYC2012 Candidature File, 2004). NYC2012 also received binding commitments that all signage on subways, buses, and transit platforms and in the city’s three major airports would be made available to NYCOG from the four weeks preceding the Games to the two weeks following (NYC2012 Candidature File, 2004). Although the 2012 Games were eventually awarded to London, NYC2012’s initiatives to prevent ambush marketing illustrate the various measures that prospective countries and cities must commit to in their efforts to secure the rights to host special sport events.

Enactment of Trademark Protection Legislation An increasingly important tactic used to strengthen an event organizer’s arsenal against ambush marketing is the passage of special trademark protection legislation by the host country or city. Such legislation is the result of conditions that are incorporated into an event organizer’s documents dictating the terms under which a prospective country or city may be awarded the event. This tactic has been most often associated with host countries of Olympic Games (McKelvey & Grady, 2004;

574 McKelvey and Grady Vassallo et al., 2005). However, enacting special trademark legislation is not a phenomenon unique to the Olympic Games. In fact, “it is now common practice for organizers of major events to require appropriate ambush marketing protections to be implemented as a condition for hosting the event (Mallard, 2007, p. 1).

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