The Olympics have long been viewed as a gold medal opportunity for brand owners. The Games give companies the opportunity to promote their brands to a worldwide audience, unrivalled except perhaps by the World Cup. But as viewing figures and the event's prominence increase exponentially, so too do the costs of staging the spectacle.

For the Olympic organisers, corporate sponsorship is one of the most important sources of revenue. Indeed, a vast portion of the income required to stage the London 2012 Olympic and Paralympic Games is expected to be achieved through sponsorship packages. The concern for many companies is that the cost of those packages can be very high – figures published in respect of certain Tier One corporate partners of London 2012 suggest they have paid between forty and eighty million pounds for the privilege.

As a result, brands which are unwilling, or unable, to pay for official status have sought to find other ways to use the Olympics and other events to boost their profile. These companies have adopted a number of practices which have become known as ambush marketing.

What is ambush marketing? 

Ambush marketing can be defined as drawing an unauthorised association with an event without paying for an official designation. It is not a new phenomenon. A classic example of ambush marketing took place at the 1996 Olympic Games; Nike bought up billboard space around the venues, constructed a Nike Village next door to the athletes' village and handed out flags bearing Nike's logo, 'ambushing' the official sponsor, Reebok. When television audiences were asked to recall the names of the official sponsors, 22% cited Nike, compared to only 16% naming Reebok!

In Beijing, ambush marketing was prevalent. Dairy group Mengiu launched a search for China's best amateur athletes and toured the country in the wake of the Olympic torch. Even without active references to the Olympics, people assumed there must be some form of official relationship. There wasn't.

Pepsi ambushed official sponsor and arch-competitor Coca-Cola by sponsoring the 2007 Asian Games, allowing it to use 'Team China' in its marketing up to the end of last year. That connection established; it subsequently produced its cans in a colour it termed 'China Red', extending the association in the minds of the public. Perhaps the most avoidable ambush marketing of all time was triggered when the organisers invited Li Ning, a gold-medal winning Chinese gymnast, to light the Olympic flame. Li Ning owns his own sportswear brand, competing in China with official sponsor Adidas. Meanwhile, Nike, again not an official sponsor, has announced that it has had its best ever Games.

Legal implications of ambush marketing

Ambush marketing is high risk for a number of reasons. Firstly, where ambush marketers make unauthorised use of trade marks, designs, copyright protected works etc. the event organiser may be able to make use of the usual remedies for intellectual property infringement. For example, "Beijing 2008" is a registered trade mark (in the U.K.; it is not just protected in China).

Secondly, it may be possible for a disgruntled organiser to pursue an action in passing off, where a business has made a misrepresentation which led to confusion in the minds of the public as to whether that business has an official connection with the event.

However, the creativity of ambush marketers has caused a constant headache to those organising major sporting events, such as the Olympics. In many cases, those seeking to make an unofficial connection have been clever enough to avoid making use of protected words or logos and passing off is not easy to establish in these circumstances.

Consequently, the International Olympic Committee (IOC) has sought to impose anti-ambush requirements as a condition of bidding to host the Olympics (and where the IOC leads, organisations, such as FIFA and UEFA, are bound to follow). Host cities are required to sign up to strict contractual obligations prior to the Games being awarded and, in practice, these have to be underwritten by new primary legislation restricting ambush marketing. As a result, the legal protections against ambush marketing in China are some of the toughest in the world and, post the award of the 2012 Games to London, English law is even more onerous.

The London Olympic Games and Paralympic Games Act 2006, together with the Olympic Symbol etc. (Protection) Act 1995 (as amended) set out specific legal protections for Olympic-related intellectual property (such as the Olympic rings) and special measures intended to make ambush marketers lives difficult. The relevant statutory provisions are drafted very widely, so as to prevent businesses from suggesting an association between the Olympics or the London Olympics and themselves or their good and services. Though there is an exception for statements according with honest practices, the London Organising Committee of the Olympic Games (which has regulatory responsibility) is, to say the least, taking a narrow view…

An Olympic ambush 

The legal risks in ambushing a major sporting event, such as the Olympics or the World Cup are great. Marketing teams will inevitably be keen to get involved and will need to be carefully advised by their legal and compliance teams.

There will still be opportunities for those willing to take risks – the success of ambush marketing efforts in Beijing, in the face of onerous legislation, showcases that. In addition, though advertisers have called it draconian, the law cannot be used to clamp down on efforts to promote sport or healthy living falling short of suggesting an Olympic association. Nike is currently running a campaign featuring young athletes training on building sites – would Nike be so blunt as to suggest that those might be venues for London 2012? Of course not.

Now is the time to start considering your strategy – if that includes official sponsor status, then an approach can be made to the relevant bodies. If it does not, then a good knowledge of the law will be required, or you could find your only association with London 2012 is a legal claim from the organisers.