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The Business Case for an Olympic Sponsorship

On September 30, the London Organizing Committee of the Olympic and Paralympic Games (LOCOG) announced its selection of UPS as the official logistics and express delivery supporter for the London 2012 Olympics. What this verbose title means is that UPS will provide critical transportation and logistical services for the London Olympics, much like we did for the 2008 Beijing Games.

In this extremely challenging economic environment, the value of an Olympic sponsorship is understandably subject to debate. In every corner of the world, companies large and small have suffered during the recession and many are facing a long recovery. So why in the midst of such financial upheaval would UPS commit significant resources to what is essentially a massive series of sporting events?

First and foremost, unlike most sponsors, UPS’s involvement with the London Olympics won’t require us to write a check for our participation. The majority of UPS’s Olympic investment will come in the form of “value in kind” services, whereby we’ll provide our people, technology, vehicles, facilities, and, most notably, our extensive Olympic experience and expertise.

Secondly, the Olympics are unique in their ability to draw an audience of unparalleled size and diversity, providing UPS with a tremendous opportunity to showcase the depth and breadth of our global service portfolio.

In China, sponsoring the Beijing Olympics opened a lot of doors for us. UPS has been in China since 1988, but until China became part of the WTO in 2001, we had to provide service by means of a Chinese domestic carrier. As a result, the UPS brand was virtually unknown in China until we became wholly-owned there in late 2004.

The Beijing Olympics provided a powerful catalyst to quickly build the UPS identity in what is undoubtedly UPS’s most important emerging market. Since our sponsorship last year, we’ve seen our brand awareness increase in China by more than 30%. A significant jump like that would have taken years to achieve had we relied exclusively on a more traditional approach utilizing only marketing and advertising campaigns.

Of course, Beijing and London are very different markets, so in terms of opportunity it’s hard to equate one to the other. Even so, sponsoring the London 2012 Olympics offers substantial growth opportunities for UPS.

As one of Europe’s primary centers for commerce, London is a gateway to other markets around the world and our Olympic sponsorship will give us a very large stage to demonstrate our capabilities to not only the local market, but to a global audience. And like Beijing, we’ll use the London Olympics for customer hospitality and employee recognition programs that provide their own kinds of benefits.

All of UPS’s sponsorship programs are expected to pay dividends, just like any traditional investment. Whatever we do—whether it’s the Olympics or NASCAR or the European PGA—we expect a solid return and the London 2012 Olympic and Paralympic Games will be no exception.

We’ll be providing periodic updates about the ways in which we’re leveraging our London Olympics sponsorship to build our business, but if you’d like to know more about what we’ve done already, please check out our new Olympics microsite.

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