Olympic Committee Inks Deal To Help Spur Sponsorship
The U.S Olympic Committee is getting some help to recruit scandal-shy corporate sponsors.
‘We recognized that we had a very tall task and a long way to go’ in raising money, Mitt Romney, president of the Salt Lake Organizing Committee, said Wednesday in announcing the hiring of a sports marketing company. ‘If our coffers were full we wouldn’t need to bring in another team member.’
The hiring of International Management Group, which handled sponsorship sales for the 1992 Winter Games in Albertville, France; the 1994 Winter Games in Lillehammer, Norway; and the 1992 Summer Games in Barcelona, comes at a time when USOC and SLOC have been at odds over funding.
USOC and SLOC have a joint marketing venture, called Olympic Properties of the United States – OPUS which is $300 million short of its goal of raising $859 million in contributions and in-kind services.
USOC officials blame the Salt Lake City bribery scandal for the marketing woes, while some officials connected with the Salt Lake City organizing effort have said that the marketing was going slowly even before the scandal hit late last year. Romney has called the OPUS goal ‘very optimistic.’
Just one sponsor- longtime Olympic backer Seiko- has signed with the USOC since it was revealed that Salt Lake City bid officials gave scholarships, lavish gifts, land deals, free trips and other perks to International Olympic Committee members and their families as the city tried to land the games. It was announced this week that Johnson & Johnson has backed out of an estimated $30 million sponsorship deal.
‘We were way ahead of the curve…and then I think the marketplace and the Olympic family have been distracted by the scandal,’ USOC marketing head John Krimsky Jr said, ‘We have to hit the ground running.’
Robert Prazmark, IMG Senior Vice President of Business Development, who will spearhead the Olympic sales pitch, said, ‘Opus is not out of time. They just lost their cushion of time and they just have to be flawless the rest of the way.
He said companies are asking themselves if the Olympic name has been tarnished by the scandal, whereas before, ‘that question was never raised.’
Prazmark said the companies he has dealt with remain eager to help make the Olympics a success. The marketing deal extends through 2004 and applies to the US Olympic teams for the Sydney, Salt Lake City and Athens games. Krimsky said 80 percent of the money generated will go to stage the 2002 Winter Games in Utah.
IMG will be paid a commission for sponsors it brings to the USOC, but the officials refused to disclose the percentage the company would earn.
‘It’s far, far, far, far below industry standards,’ Prazmark said. ‘It still has to be a business decision, but there’s a lot of wanting to help out.’
Romney said IMG agreed to waive its commission for Utah-based sponsors. Also, the USOC has agreed to compensate SLOC for commission payments until $859 million target for sponsorship revenues is reached. Prazmark said as many as 50 of the company’s 2,000 staff members worldwide could work on the Olympic sales.
‘It gives us arms and legs we simply don’t have today,’ Krimsky said.
‘We have a long way to go,’ Romney said. ‘But (the SLOC and USOC) agree it makes sense not to just keep playing with the same number of players.’
Romney, who was hired to take over the Salt Lake City Olympics planning in the wake of the scandal, has been preparing budget cuts in case the fund-raising efforts fall short.
One of his potential cuts involved operating expenses for the Winter Sports Park, which has ski jumps, the bobsled-luge track and the Oquirrh Skating Oval-the speedskating venue.