UPS Drops Out of Olympic Sponsorship

In a setback to the marketing of the five Olympic rings, United Parcel Service officials have decided not to re-sign as one of the International Olympic Committee’s worldwide sponsors. A formal announcement is expected today.

UPS, which has been an IOC sponsor since 1994, is opting out despite the success of the Sydney Games, which appears to have reestablished the marketing luster of the five rings--an appeal that had been questioned because of the Salt Lake City bid crisis, the worst corruption scandal in Olympic history.

Officials stressed Wednesday that the scandal did not figure in the move by Atlanta-based UPS to opt out. Company officials indicated they simply preferred a different marketing strategy.

The run-up to the Sydney Olympics was marked, however, by ongoing tension between UPS and Olympic officials over the delivery to Australian households of tickets to the Games, a row that captured little public attention elsewhere but that left both UPS and Olympic insiders questioning the value of UPS’ sponsorship.

That sponsorship cost about $40 million from 1997-2000. A 2001-2004 sponsorship generally starts at $55 million in the IOC’s global sponsor program, called TOP, for The Olympic Partners program. Total TOP sponsor contribution for the next four years is already “well north of $600 million,” IOC marketing director Michael Payne said Wednesday.

As mundane as ticket delivery might seem, it’s essential to Olympic logistics--and UPS’ departure means officials in Salt Lake City must figure out how to deliver tickets to the 2002 Games.

Despite the difficulties in Australia, Olympic officials say they would have welcomed UPS back as a sponsor. If UPS had re-upped, the IOC would have been able to boast that, despite the scandal, it had secured or renewed commitments in all 11 TOP categories.

As it is, Payne said, “10 of 11 is not bad.”

TOP sponsors signed up for 2001-2004 include Coca-Cola, John Hancock, Kodak, McDonald’s, Panasonic, Samsung, Sports Illustrated, Visa, Xerox and the Anglo-French technology firm Sema. It was announced months ago that Sema would take over Olympic technology needs from IBM, which has been a TOP sponsor since 1993.