The Birth of Megasports Sponsorships: The Olympics Don’t Take American Express (The Ultimate Guide to Salesmanship) by Rob Prazmark

In “The Olympics Don’t Take American Express,” Rob Prazmark delivers a captivating and insightful guide to the world of megasports sponsorships. This book is a must-read for anyone looking to navigate the complex landscape of sports marketing and secure lucrative sponsorship deals.

Continue reading to discover the invaluable lessons and strategies that Prazmark shares from his extensive experience in the industry.

Genres

Business, Marketing, Sports, Sponsorship, Sales, Entrepreneurship, Advertising, Branding, Negotiation, Strategy

“The Olympics Don’t Take American Express” is a comprehensive guide to the world of megasports sponsorships, written by industry expert Rob Prazmark. The book delves into the history and evolution of sports sponsorships, highlighting the key players and events that shaped the industry. Prazmark shares his personal experiences and insights, providing readers with a behind-the-scenes look at the negotiations and strategies involved in securing high-profile sponsorship deals.

The book covers various aspects of sports sponsorships, including the importance of building relationships, understanding the target audience, and creating compelling sponsorship packages. Prazmark emphasizes the significance of aligning sponsorships with brand values and objectives, ensuring a mutually beneficial partnership between sponsors and sports properties.

Throughout the book, Prazmark offers practical advice and real-world examples, equipping readers with the tools and knowledge necessary to succeed in the competitive world of sports marketing. He also addresses the challenges and opportunities presented by the ever-evolving digital landscape, and how sponsors can leverage new technologies and platforms to engage with fans and maximize their investments.

Review

“The Olympics Don’t Take American Express” is an essential resource for anyone interested in the business of sports sponsorships. Rob Prazmark’s wealth of experience and expertise shines through in every chapter, as he offers valuable insights and actionable strategies for securing and maximizing sponsorship deals.

The book is well-structured and easy to follow, with Prazmark’s engaging writing style making even complex concepts accessible to readers. The use of real-world examples and case studies helps to illustrate the key points and brings the lessons to life.

One of the strengths of the book is its comprehensive approach to the subject matter. Prazmark covers all aspects of sports sponsorships, from the initial pitch to the execution and evaluation of campaigns. He also addresses the importance of adaptability and innovation in an industry that is constantly evolving.

While the book is primarily focused on megasports sponsorships, the lessons and strategies discussed are applicable to a wide range of sports properties and brands. Whether you are a seasoned sports marketing professional or a newcomer to the industry, “The Olympics Don’t Take American Express” is an invaluable resource that will help you navigate the complex world of sports sponsorships and achieve success in your endeavors.

Recommendation

A former ad salesman for the ABC television network, Rob Prazmark became the first marketer to recruit corporate underwriters for the Global Olympics Programme, starting with the 1988 Winter Games. The original sponsors paid many millions of dollars for exclusive rights to use the Games to promote their products and services. This turning point fortified the Games financially. For the first time, the International Olympic Committee also allowed commercial use of the five-ringed Olympic logo. The 1988 Winter Olympics marked the birth of today’s massive sports sponsorships, leaving Prazmark with a continuing and justified sense of pride since such sponsorships make large-scale athletic competitions financially possible.

Take-Aways

• Rob Prazmark sold commercial time for NBC and the ABC network before joining a sports marketing firm.
• In 1988, Prazmark’s firm garnered millions selling Olympic marketing rights to Coca-Cola, Visa, and other Winter Game sponsors.
• A campaign to support a Smithsonian traveling exhibit raised nearly $50 million for a nine-city tour.
• Reporting to Mitt Romney, Prazmark’s team sold about $100 million in sponsorships for the 2002 Winter Olympics.
• VW Audi became the automotive sponsor of the Beijing Olympics, despite Chinese opposition.
• When his contract with the US Olympic Committee ended in 2009, Prazmark returned to his “roots” as a consultant to the International Olympic Committee.

Summary

Rob Prazmark sold commercial time for the time for NBC and the ABC network before joining a sports marketing firm.

Rob Prazmark was born in Buffalo, New York, attended a Jesuit college, and sold Xerox copy machines. The company transferred him to Washington, DC, and he left Xerox to sell airtime at a local television station, WDCA-TV. In 1977, he moved to New York City to sell ads for a group of five NBC television stations.

Prazmark joined the ABC television network in 1982 to persuade major advertisers to buy pricey media sponsorships on such programs as World News Tonight, Nightline, and 20/20.

From an article in Advertising Age, a trade publication, Prazmark learned about a business in Lucerne, Switzerland called International Sports Leisure Marketing (ISL). German businessman Horst Dassler founded the company, which won the global marketing rights to the Olympic Winter Games in Calgary, Canada, and the Olympic Summer Games in Seoul, South Korea, in 1988. Prazmark and a colleague quit their jobs at ABC to join ISL and open its US branch.

“There is something indescribable about the Olympics that attracts corporate support.”

Prazmark met with a representative of the International Olympic Committee (IOC), and learned that it was developing an experimental project called, “The Olympic Programme” or TOP. It packaged the commercial and marketing rights of the IOC, the Olympic Summer Games, the Olympic Winter Games, and most of the National Olympic Committees (NOCs) worldwide – including the United States Olympic Committee (USOC).

The IOC’s performance had been declining for years. This was due, in part, to disorganization. Its president, Juan Antonio Samaranch, asked ISL for help. Marketers from major corporations such as Coca-Cola had struggled to sponsor the Olympics and felt frustrated. Coca-Cola had bought worldwide rights to the 1984 Los Angeles Olympic Games without realizing that activating Olympic promotions outside the United States required permission from each nation’s National Olympic Committee. Every national organization demanded more money from Coke.

In 1988, Prazmark’s firm garnered millions selling Olympic marketing rights to Coca-Cola, Visa, and other Winter Game sponsors.

By May 1983, Dassler had helped present the concept of The Olympic Programme (TOP) to the IOC’s 80 members and its executive board. The presentation included a recitation of the challenges facing the Olympic movement, the Games’ increasing costs, and the IOC’s deep dependency on television rights fees, which came solely from the United States.

TOP called for merging the assets of the Winter and Summer Games and all the individual National Olympic Committees that chose to participate – and then selling companies the right to use the five-ringed Olympic logo (“the IOC’s holy grail”) for marketing. The IOC had never before allowed the rings to be used in a commercial context.

In 1985, the Seoul Olympic Organizing Committee, the administrative body for the 1988 Games, joined the US Olympic Committee in authorizing ISL Marketing to sell Olympic rights to 18 industries that represented 44 categories of products, not including cars.

Prazmark had difficulty explaining to ad agency reps how TOP worked. They wanted to know how much advertising time their client companies would get for buying Olympic sponsorship rights. The answer was none: Buying sponsorships gives companies access to purchase ad time, not the time itself.

American Express refused to enroll in TOP, so Prazmark set out to sell Olympic sponsorship in the credit card category to Diners Club, Discover, MasterCard, and Visa. MasterCard snubbed him. When Prazmark asked for $15.5 million from Diners Club, its executives had him escorted out of the building. He saw Visa as his “only long, long shot.” Visa ultimately paid $15.5 million for its Olympic sponsorship. Other sponsorship payments included $6 million from Federal Express, $10 million from 3M, and $28 million from Coca-Cola.

“The financing of the Games could be an Olympic event; you got your winners, and you got your losers.”

Visa used its status as an Olympic sponsor to denigrate rival American Express. In an ad that initially focused on Calgary, home of the 1988 Winter Games, the narrator warned sports fans who might travel there to bring a Visa card because, “the Olympics don’t take place all the time, and this time the Olympics don’t take American Express.” In 1988, the incremental use of Visa cards due to a torrent of Olympic-related marketing was 50% greater than Visa had predicted.

A campaign to support a Smithsonian traveling exhibit raised nearly $50 million for a nine-city tour.

The initial TOP campaign raised about $95 million, and the prospects for TOP II appeared even more promising, in part because Kodak and Coca-Cola renewed their participation. When Federal Express did not renew, Prazmark sought to replace it with DHL or UPS, which had its base in Atlanta, home of the 1996 Summer Games. Prazmark convinced UPS executives to embrace “conversion marketing.” This meant converting much of UPS’s previously allocated marketing budget to Olympic-themed marketing rather than increasing the company’s total marketing budget.

Prazmark quit working as an ISL employee, but consulted for the company on the TOP program while working on his idea for the “train project.” In 1991, he proposed that the Smithsonian Museum celebrate its 150th birthday in 1996 by sponsoring a national train tour featuring a traveling exhibit. In 1991, the Smithsonian consisted of 16 museums and research centers, plus a zoo, each with its own management and budget.

By late 1992, the idea of putting a traveling Smithsonian exhibit in convention centers replaced plans for a train tour. After MCI, a telecommunications company, became the third sponsor of the traveling exhibit, Prazmark and his team raised nearly $50 million of sponsorship support. The exhibit toured nine cities.

Mark McCormack founded IMG, a marketing company that got its start advising golfer Arnold Palmer on product endorsement requests. Prazmark met McCormack and other IMG executives, including IMG North American president Bob Kain, in New York in the fall of 1996. McCormack proposed that IMG and Prazmark’s company, 21 Marketing, should operate as a team. Prazmark agreed, and the firms merged in February 1997.

Reporting to Mitt Romney, Prazmark’s team sold about $100 million in sponsorships for the 2002 Winter Olympics.

In December 1998, USA Today reported that IOC member Marc Hodler had publicly attacked the integrity of the bidding process the IOC used to select Olympic host cities. During a press conference, Hodler criticized IOC members for trading votes for expensive gifts. He claimed that they voted for Salt Lake City, Utah as an Olympic host city in exchange for promised jobs for family members, support for favorite causes, and shopping sprees for spouses. News media reported the Hodler rant as a “full-blown global scandal.”

John Krimsky, who controlled USOC’s marketing, had guaranteed the Salt Lake Olympic Committee at least $600 million from sponsorships for the 2002 Olympic Winter Games. He asked Prazmark and IMG for help.

“I had packed my New York spunk and came ready to fight. Instead, as Mitt [Romney]…greeted me, his amazing calm and warm smile turned me into soft New York pizza dough.”

Krimsky resigned from the USOC board, and Prazmark took over the sales effort, reporting to former Bain Capital executive (and future governor, senator, and presidential candidate) Mitt Romney. Prazmark didn’t know Romney – son of former Michigan governor George Romney, a 1968 presidential candidate. Mitt Romney treated Prazmark well and told him that the USOC needed $300 million of sponsorship revenue to cover the cost of the Salt Lake City Games.

Prazmark and his IMG team raised about $100 million. Romney and his colleagues raised $200 million, and the Salt Lake City Games were financially successful.

VW Audi became the automotive sponsor of the Beijing Olympics, despite Chinese opposition.

In 2003, VW Audi – which was losing market share in China – turned to IMG to guide it in submitting a sponsorship bid to the IOC and the Beijing Olympic Organizing Committee (BOCOG).

Beijing Mayor Lui Qi told VW Audi that Hyundai would be the sole automotive sponsor of the Olympic Games in China. However, the IOC separately assured VW Audi that it would use “open and transparent” bidding to select an automotive sponsor.

“For me, the Olympics are less about watching sports and more about doing business…I am there to work.”

After BOCOG set the minimum bid at $50 million, Chrysler, Ford, GM, Honda, and Toyota withdrew, leaving only VW Audi and Hyundai. VW Audi submitted a $76 million bid. Hyundai submitted a bid for the same amount. An unidentified person told Prazmark that “people are being paid” to make sure that Hyundai would force VW Audi to withdraw by matching every offer it made.

BOCOG asked VW Audi to add $10 million to its bid in exchange for “a guaranteed win.” VW Audi refused, but BOCOG later announced that it won the bid. VW Audi held a 35% market share in China in 2003, but forecasters expected it to fall to 18% by 2008. Thanks to its affiliation with the Olympics and, by extension, the Chinese government, VW Audi’s market share in China stabilized at 25%. The company paid a $3 million success fee to IMG.

When his contract with the US Olympic Committee ended in 2009, Prazmark returned to his “roots” as a consultant to the International Olympic Committee.

In August 2005, USOC boss Peter Ueberroth asked Prazmark confidentially how he would run marketing at the USOC. Prazmark proposed a joint venture to take charge and remake the USOC’s marketing, but the arrangement never came about because Ueberroth believed the USOC didn’t need IMG.

Prazmark decided he was destined for entrepreneurship and wanted to run his own business. Ueberroth wanted the USOC to become the first client of Prazmark’s reconstituted marketing business, 21 Marketing, which would pursue opportunities that were difficult for the USOC to develop. However, when a contract between Prazmark and the USOC expired in April 2009, the USOC didn’t renew it.

“This was America and we couldn’t let the games fail.”

Prazmark happily returned to his “roots” at the International Olympic Committee. Attending the Olympic Games is an important part of his consulting work for the IOC, and it always leads to more connections. For example, he ran into Dallas Cowboys owner Jerry Jones at the 2010 Vancouver Games. Jones had wanted Prazmark and his 21 Marketing team to develop a national sponsorship program for the Cowboys and Texas Stadium. Sponsorship deals with American Express, Nike, and Pepsi ensued, along with a dispute over commission compensation. Prazmark eventually sued Jones, but their Vancouver meeting was cordial, in keeping with the spirit of the Games.

About the Author

Rob Prazmark spent 40 years in multimillion-dollar marketing and dealmaking, recording $3.8 billion of revenue for the properties he represented. He is writing a sequel to this book, Innovators, Imitators and Idiots, which picks up in 2010 and goes through 2024, covering the Sochi and Rio Olympic Games, America’s Cup, Special Olympics International, and America250, the national celebration of America’s 250th anniversary.