|It’s been quite a week on the sponsorship front for Tokyo 2020, which announced three new Tier One sponsors – Canon, NEC and Fujitsu – in 48 hours. Here’s a quick take on the implications for Tokyo 2020 and Olympic sponsorship.|
1. Tokyo 2020 already has five Tier 1 sponsors – NTT and Asahi having signed up last month – putting it level with Rio 2016, which has however been marketing its domestic packages since 2009 whereas Tokyo has been in the market only since 2013. So it looks like Tokyo’s pace of sponsor acquisition is going to be more in line with London 2012 than with Rio 2016: as I’ve written previously, Rio 2016 has consistently lagged behind London 2012 in deal volume.
2. Early indications that Tokyo 2020 looks like living up to its bid promise of being a safe bet will no doubt prompt a collective sigh of relief at the IOC, given both Rio 2016′s well-publicised problems and the recent audit that revealed Pyeongchang 2018′s sponsorship and finances are in crisis. (Related point: Rio 2016 is yet to publish its accounts, in striking contrast to London 2012, which published annual financial statements. One to watch.)
3. Assuming that Tokyo 2020 is achieving its $128m Tier 1 sponsorship pricing, it has already surpassed the $568m Tier 1 revenue total projected in its candidature files, and is well on its way to surpassing its $958m total revenue projection. However, as I wrote back in September 2013 when Tokyo won the 2020 Games, these revenue projections were extremely cautious, and I continue to expect Tokyo to achieve sales of well over $1 billion, and perhaps as much as $2 billion if Japan’s economy remains stable. Remember however that these figures will include VIK, which Tokyo 2020 estimated would be 34% of sponsorship revenue, an unusually low VIK figure for a modern Games – London’s VIK figure was just under 55%.
4. Category boundaries are a key negotiating point in any sponsorship, but particularly in the Olympics, which always produces more than its fair share of obscure designations owing to the crowded dynamics of the Olympic sponsorship landscape. The latest batch of Tokyo 2020 sponsors continues proudly in this tradition – ‘Data Centre Hardware Provider’, ‘Specialist Public Equipment & Software Provider’ and so on – and a related curiosity is that none of the latest categories featured in Tokyo’s candidature file projections of what its Tier 1 categories would be, proving once again that bid books are more honoured in the breach than in the observance. Finally on categories, if I was a Panasonic shareholder I’d want to know why Panasonic’s new 2016-2024 TOP sponsorship agreement left the camera category open to Canon for Tokyo 2020, something that Canon is clearly already enjoying given its mischievous reference to ‘sharing the emotion’ in its Tokyo 2020 media release – Panasonic’s long-running Olympic tagline being ‘Sharing The Passion’.
5. Judging by Tokyo’s early success there will be many hotly-contested Tokyo 2020 sponsorship tenders, but arguably the most competitive will be for Tokyo’s automotive sponsorship, given the fiercely competitive Japanese auto marketplace, which grew 3.5% in 2014, and the numerous domestic and international brands operating in Japan. Only time will tell which brand emerges victorious, but candidates are sure to include Nissan, already heavily invested in the Olympics worldwide including in particular Rio 2016, and Japanese market leader Toyota, which made an untypically public and embarrassingly unfulfilled declaration that it intended to be Tokyo’s 2020′s first sponsor just before Tokyo’s final bid presentation. Watch this space…