With about 900 more days left until the opening ceremony of the 2020 Tokyo Olympic and Paralympic Games, sponsor firms have their work cut out for them in ramping up their preparations for this monumental event.

At the time of writing, in addition to 13 Worldwide Olympic Partners, there are currently 47 Tokyo 2020 Sponsors. Just a few days ago, recruitment firm Pasona Group has joined this group as an Official Supporter. The majority of the top tier local sponsors joined in 2016, so an outsider might expect that each of these firms has a solid activation plan in place and have already started on execution.

In reality, this year is crunch time for many 2020 sponsor firms to finalize and implement a strategic plan that will inspire the Japanese public and also deliver return on their investment. This is an opportunity but also a challenge, because of the large hurdle in effective differentiation. By the opening ceremony, it is expected there will be approximately 100 firms who sponsor the 2020 Games in one of 4 sponsorship tiers.

Describing the situation that the majority of these sponsors face, Coca-Cola Japan’s Oliver Takahashi told Nikkei, “They bought a Ferrari, but don’t have a license.” In a more recent article for News Post Seven, Mr. Takahashi explained that Coca-Cola will ultimately engage a team totaling 1,200 people to help with its 2020 Games campaign. While worldwide sponsors tend to have the track record, knowhow, and mindset required to leverage the Games, local sponsors who are not used to sponsorship of international sporting competitions have a high learning curve.

To give you an idea of how much the Ferrari costs, IEG published figures from Rio 2016 that suggest that each year worldwide sponsors on average spend $22.2 million USD each, while tier 1 supporters spend $3.6 million, and tier 2 spend $1.4 million each. Given the economic magnitude and national pride of Japanese domestic firms, it is safe to say that Tokyo 2020 is on track to become the best-funded game in Olympic history and a hard precedent to overcome.

However, what does this mean for the sponsors? Supporting the Tokyo 2020 Games shows consumers around the world that your firm is a patron of global sport, but that alone does not justify bankrolling the most expensive sporting competition in world history.

Even worldwide sponsors can have issues with Olympic sponsorship. In June 2017, McDonald’s Corp ended its 41-year-old sponsorship of the Olympic Games. McDonald’s, who famously had stands in the Olympic village where athletes could order menu items for free, decided that the supporting the Games was not delivering them value on par with their investment.

Speaking with officials familiar with the status of preparations, Olympic sponsorship indeed sounds like the proverbial Ferrari, but perhaps one that you have to assemble by yourself.

Sponsors get the right to use the emblems, imagery, mascots, can supply products and services, use Game-related goods etc. as premiums, promote products and services on-site, and use materials such as media from past Olympic and Paralympic Games and of past Japanese Olympic and Paralympic athletes. However, where they take it from there requires a deep commitment from each organization to devise an activation strategy that can make headlines and inspire people.

Perhaps the key to success is not in what rights sponsors receive, but rather the opportunity to be a part of the event itself. Quoting the Tokyo 2020 Sponsorship Programme website, “Games’ Sponsors will be able to contribute to the efficient administration and delivery of the Games, and the improvement of the international competitiveness of Japanese athletes.”

In the next part of this series, we will look at case studies of brands’ successful use of Olympic sponsorship.

Parthenon Japan is a strategic communications firm based in Tokyo, Japan. To learn more about our services for sponsors of the 2020 Games, please contact us today to schedule a briefing.