Under Armour leads Olympic marketing shake-up after 'rule 40' changes

Wed Jun 29, 2016 10:15am EDT
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By Liana B. Baker

(Reuters) - Against a backdrop of the iconic five rings, legendary swimmer Michael Phelps sat on a United States Olympic Committee stage at a March media event in Los Angeles, telling reporters why he had arrived fashionably late.

He had been rushed by private jet from Baltimore, courtesy of his sponsor Under Armour (UA.N: Quote), which had held its own media event the same day (a coincidence, the company said). Phelps called Under Armour-backed athletes a "family" and its chief executive Kevin Plank a visionary with "mind-blowing ideas."

The scene previewed the kind of marketing to expect during this summer's games, with companies operating under newly liberalized sponsorship rules - enacted after years of lobbying by athletes and their agents.

Under Armour won't pay the USOC or the International Olympic Committee for such mind-blowing branding opportunities. The company is not an official sponsor of the games. That privilege costs brands such as Nike Inc NIKE.N, Visa Inc (V.N: Quote) and McDonald’s Corp (MCD.N: Quote) tens of millions of dollars for explicit rights to use the rings, the word “Olympics” and other intellectual property.

Sports agents and marketing executives told Reuters that Under Armour's campaign will be the best case study for the changes to so-called rule 40, which ends a marketing blackout during the games for companies who sponsor athletes rather than the event itself.

Phelps, one of Under Armour's biggest bets, competes this week in the U.S. swimming trials, where he aims to secure a spot in his fifth Olympics. He hopes to add to his total of 18 gold medals and 22 medals total, which already makes him the most decorated Olympian of all time. On Tuesday, Phelps posted the top time in the 200 meter butterfly heats, advancing to the semi-finals.

Beyond Phelps, Under Armour has backed a fleet of about 250 athletes - from the famous to the obscure - and plans a wide range of creative tactics to connect its brand to the Olympics.

The apparel company will, for instance, rent a series of outdoor gyms on a 50-mile stretch of beach in Rio to set up marketing outposts and host daily workouts for fans during the games. It will entertain VIP guests in a penthouse where they can mingle with its stable of athletes.   Continued...

Michael Phelps competes during the men's 200m butterfly preliminary heats in the U.S. Olympic swimming team trials at CenturyLink Center in Omaha, Nebraska, U.S. June 28, 2016. Mandatory Credit: Rob Schumacher-USA TODAY Sports/File photo