Ambush marketing - smart or unethical?

Sales & Marketing

In 1999, Pepsi Cola was an official sponsor the World Cup Cricket tournament in India.

It’s rival, Coca Cola, provided no form of financial support to the event.

However, that did not stop Coke from using the event for promotional purposes (refer article). Indeed the company placed hired people in the stands to drink Coke, wear Coke t-shirts and furl Coca-Cola flags in front of worldwide television audiences - all at an event sponsored by its rival.

 
Ambush marketing

The above example demonstrates the emergence of a controversial approach toward using large sporting events or other significant events for promotional purposes. This approach is commonly referred to as ‘ambush marketing.’

Ambush marketing is the practice of non-sponsors of major public events attempting to use the event for their own promotional purposes, often at the expense of rivals who sponsor the event.

The practice can take a wide range of forms (refer article), and can include sponsoring media coverage of an event (as opposed to sponsoring the event itself), sponsoring individual athletes or teams associated with the event, placing advertisements on nearby billboards, or giving away items (such as t-shirts or flags) for display at the event.

Such practices are particularly common at high profile sporting events, such as the Olympics or World Cup Soccer.

Although often sneaky, advertisers typically attempt to work within the confines of the law, and illegal practices are less common.

 
Why does it matter?

The practice of ambush marketing typically has an adverse effect on two parties – official corporate sponsors and the organizers of major events.

From the perspective of corporate sponsors, ambush marketing from rivals can have an adverse impact upon the value of the sponsorship. Consider Addidas and its sponsorship of the 1996 Olympics in Atlanta. The value of its sponsorship was significantly eroded by the actions of its rival, Nike, which plastered the city in billboards, handed out swoosh banners to wave during competitions and erected an enormous Nike centre overlooking the stadium.  

Not surprisingly, many people believed Nike, not Addidas, to be the official sponsor (refer article). 

Perhaps of greater importance is the adverse impact which ambush marketing can have upon organizers of major events, such as the International Olympic Committee.

These organizations are reliant upon corporate sponsorships as their primary source of funding. Ambush marketing places such sponsorships in jeopardy, potentially placing at risk the ability of event organizers to manage and run major events.

 
Unethical or smart?

My initial thoughts were that all forms of ambush marketing were unethical – companies who wish to use major sporting events for promotional purposes could at least provide a financial contribution to such events. Moreover, companies who are unwilling to support major events financially should not engage in any conduct which could potentially sabotage the benefits of such events for official corporate sponsors, particularly in cases where the sponsor concerned is a rival.

However, after further consideration, my opinion on the matter has changed, and I do not feel that it is that simple. Ambush marketing can take many forms, and in my view, some forms are acceptable from an ethical standpoint whilst other forms are not.

 
Acceptable Practices

The practice of sponsoring competing athletes or teams, for example, rather than sponsoring the event itself, is perfectly acceptable. Individual athletes and teams would not be able to train or compete without funding from sponsorships, and it is perfectly acceptable for companies to choose this method as a means of promotion rather than sponsoring the event itself.

Also acceptable are the practices of sponsoring media coverage of an event (again, as opposed to the event itself) or simply increasing the intensity of advertising in the lead up to the event.

Such practices, in my view, do not breach any ethical boundaries.

 
Unacceptable Practices

On the other hand, practices which do breach ethical boundaries include handing out t-shirts or flags to attendees for display inside the arena, booking billboards in the vicinity of the arena for display advertising, or handing out free samples of non-sponsor products, again in the vicinity of the arena.

Use the sporting arena or surrounding vicinity for promotional purposes should be limited to those who support the event financially.

In addition, any attempts by non-sponsors to mislead the public into thinking that the company concerned is indeed an official sponsor are particularly unethical. 

 
Conclusion

Some forms of ambush marketing are acceptable from an ethical standpoint, others are not.

Those which are not undermine both the value of sponsorship from the point of view of corporations as well as the ability of event organizers to secure funding required to order to manage and run the event.

 

2 Responses to “Ambush marketing - smart or unethical?”

  1. Rebekah Donaldson Says:
    October 28th, 2008 at 2:42 am

    Great post Andrew. This is fresh, insightful content.

    Re the actual topic you’ve zoomed in on… Ug! This gives me the creeps.

    I don’t know whether or not ambush marketing works in B2C with small-purchase products; it doesn’t seem to with big-purchase B2B buyers.

    I recently wrote about what seems to work and what seems to not work/backfire in “What won’t fly in that 2009 Marketing Plan” at http://blog.b2bcommunications.com/2008/09/19/2009-marketing-plan/

    Would value your comments on it.

    Rebekah Donaldsons last blog post..Business ethics discussion continues online

  2. Andrew Says:
    November 1st, 2008 at 8:01 am

    Hi Rebekah,

    Thanks for your comment and welcome to my blog.

    I would have thought that most ambush marketing would have been aimed at the B2C market, particularly the type which occurs at major sporting events, given that such events are viewed by a wide range of consumers.

    That said, I am hardly an expert in marketing. Given that the strategy has been in use for a considerable time period, I would imagine that past campaigns have produced at least some positive results.

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