Vancouver Olympics Canadian sponsorships hit gold

The Vancouver Olympics have pulled in more than double the sponsorship from domestic companies as the Turin Olympics did in 2006 despite tough economic times, setting a record for a Canadian sporting event.

The Vancouver Olympics Organizing Committee has exceeded its $756.8 million sponsorship target for funds from domestic companies, raising more than $760 million, Vanoc said in an email. The exact amount will be released in Vanoc’s final report. Once international partners are added the tally is likely to be close to $1 billion.

“They have done a fantastic job, both in terms of attracting sponsors and maximizing the amount they pay,” said Gord Hendren, president of Charlton Strategic Research, a research company specializing in sponsorship.

Organizers for the Turin Winter Olympics in 2006 managed to pull in $348 million according to the International Olympic Committee’s website. Salt Lake City’s domestic sponsorship program generated $494 million for the 2002 Winter Games, the IOC said.

“The organizers managed to focus their efforts on the emotional level,” Hendren said. “The Olympics mean a lot to Canada and especially the winter Games, much more so than the summer.”

Canadian companies paying for the privilege to have their names tied to the gold Olympic rings include Bell Canada, RBC, The Hudson's Bay Company, Rona, Petro-Canada and General Motors Canada.

The six main sponsors have put up millions in both cash and goods and services.

Bell Canada signed a deal worth $200 million, including $90 million in cash, while RBC’s commitment amounts to $110 million with $70 million in cash, according to VANOC’s website.

Most of the commitments were made and locked in prior to the financial meltdown, though VANOC managed to add another two sponsors in December and has said it would like to add one more before the Games.

For the companies, it’s hard to put a figure on the benefits they may generate from attaching their names to the Olympics. In a study after the Beijing Olympics in 2008, Forbes magazine concluded that sponsorship had little affect on the Chinese consumer’s brand loyalty.

“There has to be a return on the investment, but it’s very difficult to measure,” said Richard Powers, associate dean at the Rotman School of Management.

“If you look at RBC’s sponsorship of the torch relay, how can you put a value on the potential brand recognition from all those young people who may soon be wanting a mortgage.”

Jim Andrews, senior vice-president of Chicago-based sponsorship specialist IEG agreed.

“From a strict return on investment sense, it’s hard to say that money is coming back in,” he said. “But there are lots of reasons beyond direct generation of business to get involved and those intangibles are hard to put a dollar.”

The federal government has invested more than $1.2 billion in the Games, which have an operating budget of about $1.75 billion, according to the latest figures.

The government has commissioned a five-year study from PriceWaterhouseCoopers to assess the economic impact of the Games.

According to framework data, the Games are expected to have generated 20,780 jobs in British Columbia and another 1,750 jobs across the rest of the country, VANOC says.

The Games are forecast to generate as much as $1.05 billion to Gross Domestic Product, it said.