The Summer Olympics in Paris presented an Olympic-sized consumer engagement opportunity – at a price.
To the joy of many, including myself, this summer brought the return of one of the world’s biggest sporting events: the 2024 Summer Olympics in Paris. The Olympics is an opportunity for countries to send the best of the best to perform on the world stage, for audiences to become experts on events ranging from basketball to badminton to breaking, and for brands to vie for the attention of over three billion viewers, per EMarketer.
As someone who was fortunate enough to attend the Olympics for a few days, I had not fully appreciated the business-side of the Games until I was almost unable to buy a coffee because I did not have a Visa credit card. As the Olympics’ official payment sponsor for nearly 40 years, Visa is the only credit card accepted at Olympic concessions, forcing customers to either take out a Visa prepaid card at the stadiums or pay cash. Deliberately introducing customer friction comes at a heavy price – though economic terms of Visa’s arrangement with the International Olympic Committee (IOC) are undisclosed, contracts are estimated to be worth several hundred million dollars at a minimum. Coca Cola and Chinese dairy company Mengniu are rumored to be paying an estimated three billion dollars to be an official sponsor of the Olympic Games from 2021 to 2032.
The steep price to become an official Olympic sponsor reflects the unique degree of access that sponsors enjoy, and brand deals now represent a core IOC revenue stream. A non-profit organization, the IOC generates the majority of its revenue from the sale of media rights and commercial partnerships. From 2017 to 2021, the IOC generated $7.6 billion dollars of revenue, 61% from broadcast rights and 30% from its highest sponsorship tier, The Olympic Partner (TOP) global sponsorship program. At Paris, the TOP program consisted of only fifteen sponsors, all marquee companies in their respective sectors, including AB InBev, Airbnb, Alibaba, Coca Cola / Mengniu, Intel, Omega, P&G, Samsung, and Visa to name a few. These partners generally receive exclusive category rights (i.e., they are the only corporate sponsor in their industry) and the right to use Olympic imaging.
Capitalizing on their unique positioning, TOP sponsors often use the Olympics as an opportunity to launch new products or to introduce new audiences to existing products. Visa CMO Frank Cooper III explained their strategy to Forbes, saying, “we consistently use the global stage of the Olympics to introduce new payment technologies. During the London Games in 2012, we promoted the idea of ‘contactless payments.’ At Río 2016, we introduced the first-ever NFC-enabled, tokenized wearable...In Tokyo in 2020, we focused on the convenience and security of cashless payments.”
Along the same vein, AB InBev made Corona Cero, its zero-alcohol beer, the global beer sponsor of the Olympic Games after becoming an Olympic partner in January 2024. Growing from only 19 markets at the start of 2024, AB InBev expanded Corona Cero into an additional 21 markets ahead of the Paris Olympics, clearly identifying the Olympics as a unique customer acquisition opportunity for the relatively new product given the absence of leading non-alcoholic options Guinness 0 and Heineken 0.0 at Olympic venues.
In theory, the lack of competition and sheer size of the Olympics makes it a compelling product launch opportunity. In practice, however, there are risks to such a strategy, exacerbated by the costly investment required. For one, introducing customer friction and eliminating choice may frustrate potential new customers. When I could not use a credit card to buy coffee, I just used cash – and I am not sure if that made me any more excited to get a Visa credit card. Regular ticket holders who learned that the only beer available for purchase at Paris stadiums was non-alcoholic (due to Paris laws restricting the sale of alcohol at sports venues) might have left with a sour taste in their mouth for Corona Cero.
Alternatively, instead of becoming an official Olympic sponsor, brands can also directly sponsor athletes or National Olympic Committees (NOCs) to take advantage of the unique branding and storytelling opportunity of the Olympics. All sponsorships must comply with “Rule 40,” the IOC’s guidelines on how athletes and brands can commercialize activities around the games. Notably, there is a designated “blackout period” during which non-Olympic partners face severe restrictions in how they can use sponsored athletes or NOCs’ images and athletes are similarly restricted in sponsor acknowledgement. For years, as opposed to penalizing brands themselves, violation of Rule 40 risked athletes’ Olympic eligibility, making it a point of contention between athletes and the IOC.
However, this changed in 2019 when the IOC updated Rule 40 to relax restrictions on non-Olympic sponsors – in exchange for signing a contract exposing them to potential penalties for rule violations. Subject to certain conditions, like avoiding use of Olympic copyrighted terms, companies are now allowed to congratulate sponsored athletes for their athletic performances and athletes can thank sponsors. The IOC also launched a pilot program (“Pilot Project”) ahead of the Paris 2024 Olympics, which allowed for sporting goods brands, like Nike, Adidas, and Under Armor, to use official Olympic images and hashtags under certain conditions for sponsored athletes or NOC teams – further broadening access for non-official Olympic partners.
For Nike in particular, this development comes at a critical juncture, as the Company faces financial headwinds and increasing competition from disruptive athletic brands. In June, the company revised its 2025 revenue guidance to be down mid-single digits, following a flat fiscal year 2024 (up 1% on currency-neutral basis), citing headwinds in digital, its lifestyle brands, and key markets like China. The Company is also in the midst of executing a two-billion-dollar cost savings initiative to improve supply chain efficiency and drive “newness” in product innovation. The company plans to re-allocate these savings into reinvigorating the brand, per recent earnings announcements. As part of these efforts, Nike doubled down on the Olympics. During its fiscal Q4 earnings call, Nike’s Chief Financial Officer, Matthew Friend, outlined Nike plans to re-invest “nearly one billion dollars in consumer-facing activities in Fiscal 25…to accelerate [Nike’s] return to strong growth. This includes…driving bigger, bolder brand campaigns, starting with EC24 and the Paris Olympics.”
To that end, Nike was expected to spend more on the Paris Olympics than any prior Olympics, per reports from Vogue Business. Nike not only served as an official sponsor of the US Olympic team, it also hosted a three-day, multi-million dollar event with 40 athletes, 400 media and partners, and 13 new AI-generated sneakers (“A.I.R” sneakers), all designed to re-energize the Nike brand. Nike’s investment in Paris 2024 emphasizes how it’s not only the athletes who are taking the world stage during the Olympics.
Fortunately for brands like Visa and Nike, who decided to invest heavily into the Paris Olympics, early results suggest Paris 2024 was widely a success in terms of viewership, engagement, and content production. In the US, NBC Universal reported a total audience delivery of 30.6 million primetime viewers, up 82% vs. the Tokyo Olympics. NBC Sports social channels also registered 6.55 billion impressions on Olympics content, up 184% and 53% vs. Tokyo and Rio respectively. Clearly, the Games present companies with an Olympic-sized consumer engagement opportunity – the only question is how best to “pay” to play.
Meredith Nolan (MBA ’26) is originally from outside of Washington, D.C. She graduated from the University of Virginia with a BS degree in Commerce in 2020. Prior to the HBS MBA, Meredith worked in private equity in San Francisco on TPG’s Consumer team.
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