The controversy around ambush marketing

By Shabnam Khan, Lall Lahiri & Salhotra

While sporting events turn the spotlight onto their host country, they also play a vital role in the country’s economy. These events provide a valuable opportunity for a company to extend its competitive edge.

In recent years, corporate sponsorship has become the fastest growing type of marketing across the world. A lot of money and effort goes into sponsoring or supporting a public event and the sponsors clearly want to be exclusively associated with the event and reap maximum benefits out of this association. However, as is common for any trade or business strategy in commerce, sponsorship is not spared from being diminished and diluted by the presence of ambush marketers.

Diluted exclusivity

Ambush marketing is an effective and controversial way of not having to pay any money but still receiving attention and publicity by cashing in on the reputation, goodwill and popularity of an event. In most cases the ambush marketers are the direct competitors of the actual sponsors. The exclusivity in being part of an event is greatly diluted and the return on investment for these sponsors is jeopardized, ultimately leading to the loss of interest and value in the sponsorship.

Shabnam Khan Senior associate Lall Lahiri & Salhotra
Shabnam Khan
Senior associate
Lall Lahiri & Salhotra

Everyone’s guilty

While ambush marketing may be direct or indirect, the end result is the same: loss to the actual sponsors. Direct ambush marketing includes intentional false claims to official sponsorship by a non-sponsor to confuse consumers.

This was done during the 1994 Football World Cup where MasterCard had exclusive rights to the use of the world cup logo, but its rival Sprint Communications used the logo without authority.

Indirect ambush marketing is done by various means like sponsoring the broadcast of the event, sub-categories within the event or engaging in major non-sponsorship promotions to create an impression of association with the event sponsorship. Mercedes became famous with its indirect ambush marketing campaign at the New York City Marathon in 1997. Although Toyota was the official automotive partner of the marathon, Mercedes had its name written in the sky above the event.

Numerous cases can be cited where large companies have resorted to ambush marketing. The oldest dates back to the 1984 Olympics, where despite Fujifilm being the official sponsor its rival Kodak sponsored the television broadcast of the games. Another example: “nothing official about it” – the cheesy slogan of Pepsi during the 1996 Cricket World Cup for which Coca-Cola was the official sponsor. Also the 1998 Football World Cup where Nike sponsored a number of teams competing in the event despite Adidas being the official sponsor.

No specific law against it

Certain instances of ambush marketing clearly fall under the category of trademark and copyright violation. These include activities such as use of words, emblems, labels or symbols deceptively similar to the event, manufacturing and selling counterfeit merchandise and other sporting articles and registering fake similar domain names.

In India, unlike in New Zealand, Australia, England, China, South Africa, etc., there is no legislation to specifically deal with ambush marketing. As these issues are still being considered under the intellectual property rights laws and the doctrine of fair trade, the courts do not see the antics of ambush marketers as an infringement of intellectual property.

Protecting sponsors

However, the organizing committees of these sporting events have evolved various methods and strategies to control as far as possible the menace of such marketing.

For example, the football body FIFA has been active in protecting the rights of its sponsors and has developed a comprehensive global rights protection programme. It includes worldwide trademark protection of official logos, emblems and tag lines and ensures that the sports event is blanketed as a “protected event”. This will ensure that no ambush marketer can take advantage of special promotional benefits from the publicity attached to the events without the authority of the event organizer. FIFA has been enforcing this programme with assistance from the local authorities, customs authorities, patent offices etc.

For the Cricket World Cup 2011, the International Cricket Council (ICC) has put in place contractual clauses preventing the cricketers from endorsing competing products. Non-adherence may attract monetary penalties or even expulsion from the event. The ICC has provided strict guidelines for advertising during the period of the event.

But whether competitors and players alike will display adequate restraint during this event remains to be seen.

Shabnam Khan is a senior associate in the trademarks division of Lall Lahiri and Salhotra and takes care of India application filings and Indian trademark searches. Lall Lahiri & Salhotra is an IP boutique based in Gurgaon.


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