Ambush marketing : too smart to be good ?
«If you are travelling to Lillehammer, you’ll need a passport, but you don’t need a visa». This ad by American Express at the 1994 Lillehammer Olympic Games, sponsored by Visa, was the first example of ambush marketing. More recently, we can mention Usain Bolt who wore his Puma shoes around the neck after his 100-meter victory at the 2008 Olympic Games while the IOC’s official sponsor was…Adidas.
As we are approaching the next football world cup in Russia, it seems useful to have a closer look at the legal possibilities to tackle these kinds of marketing practices.
Marketing ambush is not a well-defined legal concept. It can hardly be apprehended by our legal arsenal. Generally, it is defined as a technique by which an advertiser associates itself with an event (and possibly with the values it represents), without authorisation from the organiser, i.e. without having to pay sponsorship fees. It thus allows the advertiser to benefit from the notoriety of an event and to take advantage of the investments made by the organiser of the event and by the official sponsors without paying itself sponsorship fees. While marketing ambush is likely to occur during any sponsored event, it is in sport that it is most common, since sport represents 90% of the amounts invested in sponsorship.
Obviously, organisers and official sponsors of an event seek to obtain exclusive protection for the event and the goodwill attached to it, in order to ensure the profitability of the investments exposed and to avoid jeopardizing their commercial strategy. However, the sponsorship fees charged by the organisers are constantly increasing because of the rising impact which the visibility of a major event generates.
Due to these ambush marketing cases multiplying , organisers are put under pressure by their sponsors who blame them for not being able to value their investments because of these practices. For this reason, ambush marketing is actively fought by most organisers of international sporting events, such as the IOC, FIFA or UEFA.
At this time, there is no specific protection under Belgian law against ambush marketing practices, despite the fact that Belgium regularly hosts sporting or cultural events with an international dimension that could give rise to ambush marketing practices, such as the “Euro 2000” football championship, the Spa-Francorchamps Formula 1 Grand Prix, the “Memorial Vandamme” athletics meeting, cycling races, music festivals, etc. In other countries, however, such legislation exists. Often, the attribution of a sporting event to a country is also subject to the adoption of specific legislation. Examples include the Olympic Arrangements Act 2000 adopted in Australia at the Sydney Olympics or the London Olympics Bill of 2005 adopted for the London Olympics in 2012.
Intellectual property law obviously makes it possible to fight against the most basic forms of ambush marketing: reproduction of mascots and other logos protected by copyright, use of competitors’ or event organisers’ trademarks, etc. These cases will generally not pose any difficulties.
However, marketing ambush cases are often more subtle. Apart from infringement of intellectual property right, Belgian case law has, to our knowledge never dealt with such subtle cases. However, the potential legal grounds are numerous, which is explained by the diversity of ambush marketing practices: massive advertising displays near sports facilities, free distribution of caps, T-shirts or other promotional items bearing the advertiser’s brand, use of planes flying over the stadium and towing a banner bearing the advertiser’s brand, or even sponsorship of an individual athlete or a team but not the event itself,…
Among these legal grounds, we can mention in particular the contract law. Here are some examples :
- licensing agreements regarding the organiser’s trademarks with, for example, a ban on sublicensing, licensing or other forms of sharing the rights granted;
- prohibitions and restrictions on the sale and resale of tickets;
- prohibition of joint promotional operations with companies other than official partners;
- agreements prohibiting or limiting the use of distinctive signs by artists, athletes, national federations or spectators;
- agreements with broadcasting organisations providing for a right of priority for sponsors for advertising programmes broadcasted during, before or after the event;
These contractual mechanisms are the most effective way to control advertising activities in the venue where the event takes place.
However, contractual mechanisms will be powerless to tackle marketing ambush practices from advertisers who are not contractually bound to the organiser. For such cases, other grounds exist. These include the mechanism of third party complicity in breach of contract. When Heineken distributed, outside the stadium, caps bearing his trademark to spectators of matches of the Netherlands during the Euro 2004, sponsored by Carlsberg, and these spectators wore these caps during the match, such a practice could probably be sanctioned by means of the theory of third complicity under Belgian law.
With more subtle practices, such as an implicit reference to a trademark, comparative advertising provisions, in particular those prohibiting any advertising that takes unfair advantage of the reputation attached to a trademark, may also be useful. Finally, one could also envision provisions on misleading and unfair advertising, although the contours of these concepts are often unclear.
But let’s make no mistake about it: often, well thought-out ambush marketing will remain in line with the law, at least in Belgium. And in the end, isn’t it healthy that the law doesn’t allow the organiser of an event and its official sponsors to monopolize all of its economic potential?
Partner THALES Attorneys – Commercial, IP & Food Law