AMBUSH official sponsor and steal the spotlight from

AMBUSH MARKETING: IS THE REGULATORY APPROACH BOWING DOWN TO
LIMITLESS INGENUITY?

Introduction

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Ambush
marketing is a company’s attempt at associating itself to the popularity of a
world renowned event without the permission of the event organizers.1 The
company aims to benefit from the attention, goodwill, awareness and other
benefits that can be accrued by associating themselves or their brand to a
well-renowned event such as Olympics, and avoid having to spend a single penny
to become one of the sponsors. The definition of ambush marketing however, has
changed over time. Initially it referred to an attempt to associate with a team
or event without being an official sponsor and steal the spotlight from a rival
who was an official sponsor of the particular event2. However,
these days, the definition of ambush marketing includes advertisements in
addition to just sponsorship. In today’s extremely competitive markets, all
companies are trying to upstage their rivals, by trying to associate themselves
with whichever celebrity or event that is gaining most publicity. This is done
through all kinds of gimmicks, from opportunistic stunts to long-haul crusades;
the object of which is to go viral in the current social media hooked society.
In fact this so called, “brand wars” appears to have evolved into a marketing
tool all its own. That being said, some brands decide upon their ambush
marketing techniques as a way to gain popularity without any evil intent
towards their competitors.3

Evolution of Ambush Marketing

Jerry
Walsh while working as the manager of the global marketing efforts of American
Express, when he coined the term ‘ambush marketing’4.  Ambush marketing, essentially is the effort
of a company to create an impression on the consumers, that there exists an
association between the company and a certain event or participants, and in
that process stealing the limelight from the official sponsors and gain
considerable commercial value through the publicity obtained.5.
This
affiliation is without consent of the coordinator or its partners, and they
want to swindle the common people into trusting that there is an official
affiliation6.

On
numerous occasions, Nike has utilized the ambush marketing techniques, to stand
out without being the official sponsor. In the Barcelona Olympics, it courted
controversy when Michael Jordan covered Reebok’s logo on his kit with the US
flag. In the Atlanta Olympics Michael Johnson, winner of the 400-metre race was
wearing Nike’s famous gold-coloured shoes as he blew past the finish line and
was later photographed wearing the same shoes around his neck along with his
medals. Recently, in the 2012 London Olympics, Nike released a six-minute ad,
Find Your Greatness, which shows athletes training in places called London
across the world, such as London in Ohio, Norway, South Africa, Jamaica,
Nigeria,
taking a cheeky jab at not being allowed to use the name of the host country
and generating a huge buzz on social media7.

Ambush
marketers do not fall foul of intellectual property laws by misappropriating trademarks
but instead ingeniously allude to a sporting event and use their own particular
trademarks to suggest an association with that sporting event8.
Ambush marketing is very difficult to define, with everyone having their own
views as to whether an activity is below
the belt or commercially acceptable in a competitive market.9 When
we get down to its nitty-gritty, there are many kinds of ambush marketing, but
broadly speaking there is essentially into two wide divisions:

·        
Practices
that directly fall foul of intellectual property law
– these will have a definite remedy in law. They are activities that clearly
constitute infringements of the property rights in an event, for example,
unauthorized use of a registered event logo on merchandise, or false claims to
be official suppliers of a particular team.

·        
Other
practices – more ingenious advertisements for which the remedy
is ambiguous or may not even exist10
since it is difficult to even ascertain as to whether these break the rules.

There
are many strategies using which a company can ambush another brand through
advertising, which would fall under the ever expanding scope of ambush
marketing. Some of these may be direct and blatant, such as coattail ambushing
which entails a brand directly associating itself with a property or event by
using an official link other than becoming an official sponsor of the property
or event. For example, Linford Christie, Olympic gold medal sprinter, wore
contact lenses with the Puma logo during a press conference preceding the game
in Atlanta. The stunt didn’t sit too well with official partner Reebok, which
had paid $40 million for the exclusive rights to the event.11
This is one of the more difficult types of ambush marketing where there is not
really much of a legal recourse that the official sponsor can take, other than
take it up with the event organizer.

To
understand, ambush marketing, it is imperative to acknowledge the reasons for
ambush marketing. There are primarily four reasons12
as to why ambush marketing survives.

1.      Ambush
marketing campaigns are short-lived and hence legal recourse becomes difficult.

2.      Lack
of case laws.

3.      Success
achieved by corporations in defending themselves.

4.      Dodging
of litigation by event organizers as they do not want to alienate future
sponsors.

The
most successful methods of ambush marketing has always been creative
advertising which though might be toeing the line of intellectual property
infringement, never makes a direct reference and hence gets away with it. Even
if the ambushed brand decides to take action, they have to ensure that they
don’t come off as the bad guy or give undue publicity as evidenced by the
Bavarian fiasco in Germany in 2006, when around 1000 Dutch fans had to watch
the Argentina vs Ivory Coast match in underwear in the wake of being denied entry,
since they were wearing the orange lederhosen clearly given away by Bavaria
with buys of its product13.
This incident ended up getting more popularity merely because the authorities
decided to strip the spectators to their underwear.

Possible Remedies

There
has been a plethora of legislative measure taken by various countries to battle
ambush marketing; but due to the legal grey area in which most of ambush
marketing strategies work in, non-legal measure will be more effective. Sports
organizations are doing more to protect their investments, and those of their
sponsors. The IOC now demands that the official broadcasters of the Games
should allow the official sponsors the first pick when it comes to advertising
during the telecast. It also obtains guarantees from host cities that
legislation will be in place to tackle ambush marketing and control of
advertisements. There is also a “binding option” to buy all available
outdoor and public-transport advertisement space in venues of the events.14

Different
legal measures are also usually deployed in tandem with other kinds of measures
to deal with the creativeness of ambush marketers, such as special
anti-association laws. These special anti-ambush marketing statutes will be in
force for that particular location and time-period. For example, the ‘London
Olympic Association Right’ applied in the UK only and expired at the end of the
Olympic year, in Brazil the offence of ambush marketing established under in so
called ‘World Cup 2014 Law’ could only be enforced until the end of 2014.15 There
is an anti-association right in respect of the 2018 FIFA World Cup for
advertising in Russia during or in connection with the World Cup, and the
non-official brands have to ensure that they don’t infringe the 2018 World Cup
Law either by associating directly or indirectly with the event or by
advertising within 2 km of stadia without authorization and complying to the
other regulations. At last, the officials can also utilize specific contracts
to prevent the participants and team officials from using their name in being
used for any illegal advertising purposes. The trade mark protection in Russia was
bolstered further by special legislation, the Federal Law (“The 2018 World Cup
Law”) of 7 June 2013 which was signed by the President of Russia, which will
help tackle any illegal associations to the event16.

The
popularity of mobile, social media and digital media marketing generally has
also opened up new fronts in the battle between rights-holders and ambush
marketers.17
In response to these new threats, rights-holders have looked to take steps to
preserve the value in their official sponsorship packages.  The US Olympic Committee, in advance of Rio
2016, went so far as to warn non-sponsors, in correspondence, that they could
not use #Rio2016 or #Team USA, share or retweet anything from official Olympic
pages or reference any Olympic results18.
But it’s questionable how effective such threats are, certainly when they
appear to extend far beyond the legal recourse which is actually available.
There are some consequences however; the TV pundit Robbie Earle was fired by
ITV when it was discovered that he had provided tickets in the Bavaria beer incident
and the South African authorities had made arrests19.

However,
event owners could also implement other options, such as reducing the number of
sponsorship categories they sell, managing the sale of rights of broadcast
sponsorship. Given the inconsistencies that have emerged between event
sponsorship and broadcast sponsorship, event owners need to manage the sale of
these rights carefully. In a study of viewers, around one third of the opinion
was that, the advertisements during the telecast of a particular event were by
official sponsors.20 Thus,
the sale of advertising time to unofficial sponsors appears to create
considerable confusion among the public

 

 

 

Effectiveness of Regulatory
Measures

The
need for regulation regarding ambush marketing is evident in today’s scenario,
when we take into account the amount of money spent by the top official
sponsors ($25-50 million per year). Almost every host nation has enacted new
statutes that can battle ambush marketing in the major Olympic and FIFA events
in the recent years. On analyzing some of these statutes and the actual impact
it had in stopping ambush marketing by unofficial sponsors, it is implicit that
the effectiveness of these statutes however leaves a lot to be desired.

Australia
in light of the 2000 Olympic Games enacted the Sydney 2000 Games (Indicia and
Images) Protection Act 1996 which build on and supplement existing intellectual
property rights in the area of copyright, trade mark design, passing-off and
trade practices law generally. The main objective behind this particular
legislation was to maximize revenue during the event through strict regulation
of the use of the logos and images associates with Olympics. On August 30, 2000,
Qantas, the Australian airline gave a full page promotion in the newspapers
which had the headline “Australia Wide Olympic* Sale”. The asterisk
in this headline referred to a very small disclaimer saying Qantas was not an
official sponsor. This caused, Ansett who was the official sponsor of the
Sydney Games to file an injunction in the Court, asking the promotion to be
withdrawn and also requested a immediate hearing keeping in mind, how close the
Olympics were. This case however, came down to nothing as the Court did not
pass any order against Qantas.21
The Sydney 2000 Act was extremely effective in preventing the sale of
unlicensed Olympic products next to official merchandise without disclaimers on
its unlicensed merchandise22
but that could have been achieved under the Trade Practices Act. As the Qantas
case has revealed, it is unlikely that the courts will see such marketing
tactics as illegal where, to the reasonable person, there is merely a
suggestion to the Sydney 2000 Olympic Games.

With
the advent of smart phones and influx of current generation onto social media,
ambush marketing that is done online, known as ‘social ambush23’ represents
the most evident risk, as it is the hardest to screen and control. The Brazil
2014 World Cup saw the rise of the ‘social’ ambush with numerous companies,
including Spec Savers, Snickers, Peperami, opportunistically posting jokes
related to Louis Suarez biting the shoulder of Italian player Giorgio
Chiellini.

FIFA
began its preparation for the World Cup in all earnestness by readying its
defenses to various intellectual property breaches and getting the host nation
to enact strict regulations and laws to tackle ambush marketing techniques that
were inevitable. Even before the actual event, research from June 2014 showed that
nearly 40% of UK, US and Brazilian consumers incorrectly assumed that Nike,
MasterCard and Pepsi were official World Cup sponsors24, FIFA’s
concerns could not be termed as trivial considering the campaigns of various
brands like Nike  which were full of
stars; and in spite of everything a search for “World Cup ad” on YouTube brought
up the Nike “Winner Stays” as the
first result even though the video does not refer to the World Cup25. When
one takes into account that, as of June 6, only 6 of the 11 most shared
football ads online were from official sponsors, it becomes clear the necessity
of anti-ambush marketing approaches. The approaches taken by FIFA maybe
effective within the borders of Brazil, but the enforcement of such measures
seem pointless when it goes online.

The
strict regulations that place prohibitions on participants and officials from using
social media for commercial purposes, brings the presumption that the athletes
will follow the rules or else risk facing potentially severe sanctions that
ultimately could jeopardize their eligibility. The major brands will not fall
foul of the regulations, but the Olympic rules clearly don’t apply to the
casual fan who can use their social media posts to provide more recognition to
the unofficial sponsors especially when they have some kind of legitimate link
to the event. The tech-savvy and social media hooked participants are the ones
who may cross some kind of line in the strict restrictions with their online
presence, as opposed to the rival brands.26

 

India

Incidentally,
India has not enacted specific anti-ambush marketing laws. Redress may be
sought under the Trade Marks Act, 1999, the Copyright Act, 1957 and the Emblems
and Names Act, 1950 and the common law notion of passing off. However, ambush
marketing techniques have evolved to the extent that they clearly avoid
intellectual property laws and are clever enough to not make any direct mention
of the protected terms. Today with the stakes in sports being higher than ever,
it is evident that the legal measures provided by the trademark law and
competition law in India are insufficient to tackle the wide assortment of
marketing techniques, which the brands keep coming up with.

The
jurisprudence in this matter in India is not at all encouraging for the event
organizers. There have been cases, where ambush marketing was alleged by the
ICC during the World Cup, but the Delhi High Court has always against the event
organizers27.
Similarly in the case of ICC Development
International Ltd. (ICCDIL) v. Arvee, the ICC alleged that a contest organized by Arvee to win tickets for
the World Cup matches was ambush marketing. Again, the claim of ambush
marketing was not recognized by the Court and acts of the defendant were not
considered misuse.28  In 
the  case  of ICC  Development v EGSS,  an injunction 
was  granted  against 
the  defendant  for misuse 
of the  world  cup logo 
only  because  there 
was a copyright infringement as the logo was held to be an artistic work
under the Indian Copyright Act.29

“In
India, brands often take the route of trademark infringement because that is
the easiest and fastest way to get an injunction to stop the other brand from
ambushing. The other option is filing a case under the MRTP (Monopolies and
Restrictive Trade Practices) Act.

In
all cases, the Courts go into the intention of the party and the message that
the ad or marketing campaign conveys to the general public, and what the public
might perceive from the advertisement or activity, which is the result of
marketing. More importantly, the Court will look at whether there is
disparaging of the competitor brand and if they have used the competitor
trademark in any manner. ” says Raja Selvam, managing attorney, Selvam and
Selvam30.

Conclusion

The
official sponsors’ definition of ambush marketing may be skewed, but according
to them such practices were not prevented in cases such as Sydney Olympics
2000, FIFA World Cups etc, as we have already seen. For the unofficial sponsors,
this advertising was simply ingenious marketing strategy. While all are
clamouring for legislation to stop the evil of ambush marketing, it also has to
be taken into consideration whether such steps are actually effective and can
it do much about maximizing the revenue of the official sponsors. Many of the
activities previously labelled ambush marketing, competitive advertising during
and around sponsored events for example, are now seen as legitimate activities31. The
creative use of ambush marketing tactics will probably always be a source of
irritation to event owners and their official sponsors, but the event owners
have accepted that the level of brand competition that exists in other media is
also likely to occur in sponsorship and associated activities. The law as it
now stands seems unable to accommodate the concerns of official corporate
sponsors. There is no limit to human ingenuity. As such, ambush marketing at
the margins will arguably always occur. Sports 
has  undoubtedly  become 
a  transpiring  international 
culture,  and  major events like the Olympics and  the World 
Cup  is  where 
the  marketers can grab the
opportunity to communicate with  the  world 
internationally.  This  then 
serves  as  a 
global  communication  medium 
of  commerce  with 
the competency of  supplying  a 
carrier  to  companies and 
firms  to  acquire 
viable  competitive advantage32.

After
analyzing the case studies of Sydney Games and the FIFA World Cups, it can be
safely concluded that merely relying on the statutory provisions that have been
enacted will prove perilous to the event organizers. The organizers of events
of this magnitude must develop an all-encompassing strategy which involves both
legal and practical (non-legal) initiatives for dealing with the issue of
ambush marketing. Any marketing strategy that still manages to ambush the event
must be held to be legal, no matter what the questions regarding the ethics
behind it is. The customary statutory measures must be enacted to take down
direct ambush marketing strategies that latch on to the intellectual property
of the event. Along with that, there must better decisions on the part of the
event organizers while distributing the broadcasting rights as well as to
ensure the advertisement spaces in and around the event locations. All of this
still may not be sufficient to bring down a huge corporation such as Nike down
to its knees, but it might still help prevent the small scale ambush marketing.

 

1 Rukmani Seth, Ambush marketing – Need for legislation in
India, 15 J.I.P.R 455 (2010).

2 Aashish Pahwa, What is Ambush Marketing? How it is used
in Brand Wars? (July 8, 2017,19:38), https://www.feedough.com/ambush-marketing/.

3 Simon Chadwick &  Nicholas Burton, Ambushed! (Jan. 25, 2010, 12:01 a.m. E.T.), https://www.wsj.com/articles/SB10001424052970204731804574391102699362862.

4 James Emmett, Rise
of the pseudo-sponsors: A history of ambush marketing (June 16, 2010, 21:49), http://www.sportspromedia.com/insight/rise_of_the_pseudo-sponsors_a_history_of_ambush_marketing.

5 Cran  David 
&  Griffiths  Simon, Ambush  marketing: Unsporting  behaviour 
or  fair  play?, 21(8)  E.L.R, 293(2010).

6 Rukmani Seth, Ambush marketing – Need for legislation in
India, 15 J.I.P.R 455 (2010).

7 Meghna Sharma, The return of Ambush Marketing (Dec. 5,
2017, 3:51), http://www.financialexpress.com/industry/the-return-of-ambush-marketing/960724/.

8 Miller  Nancy 
A,  Ambush  marketing  and 
the  2010 Vancouver-Whistler  Olympic 
Games:  A  prospective 
view (12 Apr. 2010), http://www.imakenews.com/iln/e_article000867643.cfm).

9 Alex Kelham, The FIFA World Cup 2018 – Ambush Marketing and the Law (July 19, 2017,
20:25), http://www.lewissilkin.com/Insights/The-FIFA-World-Cup-2018-Ambush-Marketing-and-the-Law.

10 Jeremy Curthoys, Francis Burt
Chambers & Christopher N Kendall, Ambush Marketing
and the Sydney 2000 Games (Indicia and Images) Protection Act: A Retrospective, 8(2) Mur.U.E.J.L.(2001).

11 Francis Dumais, Top 10 sponsorship ambushes (Feb. 01,
2014, 20:18), https://en.elevent.co/blogs/sponsorship/16644081-top-10-sponsorship-ambushes.

12 Mcdonald  Mark 
A  &  Milne 
George  R, Cases  In  Sport Marketing 190  (Jones 
and  Bartlett  Publishers 
Inc,  Sudbury 2003).

13 Issa Sikiti Da Silva, 2010 ambush marketing: Bavaria does it
again! (June 18, 2010, 20:24), http://www.bizcommunity.com/Article/196/147/49102.html.

14 Simon Chadwick & Nicholas
Burton, Ambushed! (Jan. 25, 2010,
12:01 a.m. E.T.), https://www.wsj.com/articles/SB10001424052970204731804574391102699362862.

15 Alex Kelham, The FIFA World Cup 2018 – Ambush Marketing
and the Law (July 19, 2017, 20:25), http://www.lewissilkin.com/Insights/The-FIFA-World-Cup-2018-Ambush-Marketing-and-the-Law.

16 Alex Kelham, The FIFA World Cup 2018 – Ambush Marketing
and the Law (July 19, 2017, 20:25), http://www.lewissilkin.com/Insights/The-FIFA-World-Cup-2018-Ambush-Marketing-and-the-Law.

17 Dan Smith, The digital battle between sponsors, rights holders and ambush
marketers (July 13, 2017, 15:40), https://www.lawinsport.com/topics/articles/item/sport-the-digital-battle-between-sponsors-rights-holders-and-ambush-marketers#_ftn1.

18 Olivia Solon, US Olympic committee bullying unofficial
sponsors who use hashtags (July 22, 2016, 22.54 B.S.T.), https://www.theguardian.com/sport/2016/jul/22/us-olympic-committee-bullying-unofficial-sponsors-hashtags.

19 Owen Gibson, World Cup 2010: ITV sacks Robbie Earle for
breaking ticket regulations (June 15, 2010, 14.41 B.S.T.),        

20 Dean Crow & Janet Hoek,
Ambush
Marketing: A Critical Review and Some Practical Advice, 14 Marketing Bulletin (2003).

21 Jeremy Curthoys, Francis Burt
Chambers & Christopher N Kendall, Ambush Marketing
and the Sydney 2000 Games (Indicia and Images) Protection Act: A Retrospective, 8(2) Mur.U.E.J.L.(2001)..

22 Jeremy Curthoys, Francis Burt
Chambers & Christopher N Kendall, Ambush Marketing
and the Sydney 2000 Games (Indicia and Images) Protection Act: A Retrospective, 8(2) Mur.U.E.J.L.(2001)..

23 Nicolas Chanavat & Michel
Desbordes, Towards the regulation and
restriction of ambush marketing? The first truly social and digital mega sports
event: Olympic Games, London 2012, 15(3) I.J.S.M.S. 2, 2-11 (2014).

24 Andrew Mulholland, City & Gild: Has the World Cup Lost its
Bite? (June  27, 2014, 7:53 a.m.), https://www.cityam.com/1403851981/city-gild-has-world-cup-lost-its-bite.

25 Poonam Majithia, How successful were FIFA and its sponsors at
protecting their brands during the World Cup? (Aug. 13, 2014, 20:52) https://www.lawinsport.com/topics/articles/intellectual-property-law/item/how-successful-were-fifa-and-its-sponsors-at-protecting-their-brands-during-the-world-cup#references.

26 Grady, J, Predicting the Future for Rio 2016: Legal Issues in Sponsorship, Ambush
Marketing, and Social Media, E.S.L.J., 14, 2 (2016).

27 Rukmani Seth, Ambush marketing – Need for legislation in
India, 15 J.I.P.R 455 (2010).

28 ICC  Development 
International  Ltd  (ICCDIL) v. Arvee, (2003) 26 P.T.C. 245(Del.).

29 ICC Development International
Ltd. v. EGSS, (2003) 26 P.T.C. 228 (Del.).

30 Meghna Sharma, The return of Ambush Marketing (Dec. 5,
2017, 3:51), http://www.financialexpress.com/industry/the-return-of-ambush-marketing/960724/.

31 Meenaghan T, Ambush marketing – A threat to corporate
sponsorship, 38 S.M.R. 103-113 (1996).

32 Jeremy Curthoys, Francis Burt
Chambers & Christopher N Kendall, Ambush Marketing
and the Sydney 2000 Games (Indicia and Images) Protection Act: A Retrospective, 8(2) Mur.U.E.J.L.(2001).