Sponsorship agreements between brands and significant national and global sporting and cultural events provide valuable platforms from which those brands can market to a wide and attentive audience. But they come at a cost. ‘Ambush marketing’, put simply, is a term used to describe attempts made by brands to ride the train of hype and excitement surrounding such events without paying for official sponsorship.
Between Nike and Adidas, Qantas and Ansett, and, more recently, Telstra and Optus, ambush marketing is clearly big business in and of itself. Ambush marketers do, however, run the risk of infringing the Australian Consumer Law (ACL) and, especially in the case of the Olympics, other specific anti-ambush marketing legislation. In this article, we take a closer look at some of these risks, with a special focus on the recently-commenced 2016 Rio Olympic Games.
In a recent interview between Michael Rowland and Wil Anderson on ABC News Breakfast to promote the new season of Gruen, Wil admonished Michael for referring to the upcoming Rio 2016 Olympic Games as ‘the Olympics’.
“Are we allowed to say that? Shouldn’t we be calling them ‘The Ring Games’?”
It’s no secret that the Olympics, and more particularly the sponsorship agreements surrounding them, carry significant value.
It therefore follows that the Australian Olympic Committee (AOC) has a strong and consistent history of jealously protecting its intellectual property rights over the Olympics, and the instantly-recognisable (or perhaps not so recognisable) insignia that goes with it. So much so, that in 1987, the Commonwealth Parliament legislated to provide explicit protections over particular ‘Olympic expressions’, with the passing of the Olympic Insignia Protection Act (OIP Act). ‘Olympic expressions’ are given a surprisingly broad definition: they include the words ‘Olympic’, ‘Olympics’, ‘Olympic Games’, ‘Olympiad’ and ‘Olympiads’.
Under s 36 of the OIP Act, no person (other than the AOC) is permitted to use an Olympic expression for ‘commercial purposes’, unless they have a licence from the AOC to do so. Under the OIP Act, an Olympic expression will be have been used for ‘commercial purposes’ if the expression is:
- used in a marketing campaign; and
- a ‘reasonable person’ would consider that the entity using the expression was ‘a sponsor…or the provider of sponsorship-like support’ to the AOC, the IOC, any of the Olympic Games themselves, or any of the Olympic teams or competitors.
Perhaps unsurprisingly, the scope for a breach of the OIP Act is therefore quite broad. It is no coincidence that businesses across Australia - in trying to hitch their marketing campaigns to the Olympic bandwagon in order to sell anything from beverages to televisions and travel packages - use an abundance of green and gold, and imagery of ordinary people (non-Olympians) engaging in sporting activities, while simultaneously avoiding any utterance of the 'O' word.
The Australian Parliament also deemed the Sydney Olympics so sacred that in 1996 it passed the Sydney 2000 Games (Indicia and Images) Protection Act (Sydney Act). This Act extended the protections from brand hijacking already provided in the OIP Act to the phrases ‘Games City’, ‘Millennium Games’, ‘Sydney Games’, ‘Sydney 2000’, and any combination of the word Games and the number 2000.
Such strict laws have not, however, stopped companies from devising creative ways around them.
Qantas famously released and aired an especially patriotic variant of their ‘I still call Australia home’ commercials throughout the broadcast coverage of the Sydney Games. It did so in an environment where Ansett was actually the official sponsor, having paid between $40 and $50 million for the privilege. Ansett sued Qantas under the OIP and Sydney Acts, but ultimately settled. It may be fair to say that, even today, the Qantas commercial evokes a stronger recollection of the Sydney Olympics for Australians than anything Ansett did with their official sponsorship rights.
Tensions similar to those tested between Ansett and Qantas in 2000 have very recently been brought to a head again in Australian Olympic Committee Inc v Telstra Corporation Limited  FCA 857. (We have prepared an article on this case covering the essential matters in dispute and subsequent outcomes of the decision, which can be accessed here).
Beyond the Olympics, ambush marketing campaigns have long been used as strategy by advertisers to link businesses with high profile sporting events without having to bear the costs of official sponsorship. For example, successful ambush marketing campaigns have recently been executed in the European Championship and the FIFA World Cup.
If a brand draws on themes and styles generated by a significant event to advertise its products and services around them, it can benefit from the value of an official sponsorship without having to pay the price for one. However, brands tread this fine line at their own peril.
Even beyond the OIP and Sydney Acts, legal consequences apply to brands that engage in ‘passing off’ (at common law) or misleading or deceptive conduct (under s 18 of the ACL 2010) by convincing ‘reasonable’ viewers of their advertisements that there is an official commercial connection between the brand and the sporting event.
Outside of specific legislation (like the OIP and Sydney Acts), the ACL and the tort of ‘passing off’ provide the only way for event organisers and official sponsors of those events to protect their expensive and exclusive sponsorship arrangements. While history dictates that ambush marketing strategies have been predominantly successful, they can land brands in hot water, and campaigns may benefit from legal clearance before going live.