Skipping the Olympics is ‘not an option’ for many advertisers

NYT The Olympics have long been an almost ideal forum for companies looking to promote themselves, with plenty of opportunities for brands to nestle ads am...

NYTThe Olympics have long been an almost ideal forum for companies looking to promote themselves, with plenty of opportunities for brands to nestle ads among the pageantry and feel-good stories about athletes overcoming adversity — all for less than the price of a Super Bowl commercial.But now, as roughly 11,000 competitors from more than 200 countries convene in Tokyo as the coronavirus pandemic lingers, Olympic advertisers are feeling anxious about the more than $1 billion they have spent to run ads on NBC and its Peacock streaming platform.Calls to cancel the more than $15.4 billion extravaganza have intensified as more athletes test positive for COVID-19. The event is also deeply unpopular with Japanese citizens and many public health experts, who fear a superspreader event. And there will be no spectators in the stands.“The Olympics are already damaged goods,” said Jules Boykoff, a former Olympic soccer player and an expert in sports politics at Pacific University. “If this situation in Japan goes south fast, then we could see some whipsaw changes in the way that deals are cut and the willingness of multinational companies to get involved.” Panasonic, a top sponsor, will not send its chief executive to the opening ceremony, which is scheduled for Friday. Neither will Toyota, one of Japan’s most influential companies, which also delivered a blow to the Games on Monday when it said it had abandoned its plans to run Olympics-themed television commercials in Japan.In the United States, marketing plans are mostly moving ahead.For NBCUniversal, which has paid billions of dollars for the exclusive rights to broadcast the Olympics in the United States through 2032, the event is a crucial source of revenue. There are more than 140 sponsors for NBC’s coverage on television, on its year-old streaming platform Peacock and online, an increase over the 100 that signed on for the 2016 Summer Games in Rio de Janeiro.“Not being there with an audience of this size and scale for some of our blue-chip advertisers is not an option,” said Jeremy Carey, the managing director of the sports marketing agency Optimum Sports.In a Michelob Ultra commercial, the sprinting star Usain Bolt points joggers toward a bar. Procter & Gamble’s campaign highlights good deeds by athletes and their parents. Sue Bird, a basketball star, promotes the fitness equipment maker Tonal in a spot debuting Friday.NBCUniversal said it had exceeded the $1.2 billion in U.S. ad revenue it garnered for the 2016 Games in Rio and had sold all of its advertising slots for Friday’s opening ceremony, adding that it was still offering space during the rest of the Games. Buyers estimate that the price for a 30-second prime-time commercial exceeds $1 million.Television has attracted the bulk of the ad spending, but the amount brought in by digital and streaming ads is on the rise, according to Kantar. Several forecasts predict that TV ratings for the Olympics will lag the Games in Rio and London, while the streaming audience will grow sharply.NBCUniversal said that during the so-called upfront negotiation sessions this year, when ad buyers reserve spots with media companies, Peacock had received $500 million in commitments for the coming year.“You won’t find a single legacy media company out there that is not pushing their streaming capabilities for their biggest events,” Carey, the Optimum Sports executive, said. “That’s the future of where this business is going.” United Airlines, a sponsor of Team USA, scrapped its original ad campaign, one that promoted flights from the United States to Tokyo. Its new effort, featuring the gymnast Simon Biles and the surfer Kolohe Andino, encourages a broader return to air travel.“It didn’t make much sense to focus on a specific destination that Americans might not be able to travel to,” said Maggie Schmerin, the airline’s managing director of advertising and social media.United’s campaign will appear in airports, on social media and on streaming platforms, including Peacock, but not on TV. Schmerin said the airline wanted to be “matching customers where they are, based on their viewing habits.” Ad agency executives said companies were regularly checking in for updates on the COVID outbreak in Japan and might fine-tune their marketing messages accordingly.