The Winter Olympics is around the corner and it faces more hurdles than just an ongoing global pandemic.
In addition to the rise of the Omicron variant, which continues to spread across the globe, this year’s Games are facing backlash for hosting in China, where human rights violations are being carried out against the Uyghur Muslim population and the government continues to make anti-democratic advances in Hong Kong.
The United States, alongside the U.K., Canada and Australia, have officially boycotted the games from a diplomatic perspective, declining to send government officials for the first time since the Moscow Winter Olympics in 1980. Japan will send Olympic officials, but not government officials. (Athletes from these countries will still compete.)
Add declining viewership, a tepid outcome from the Tokyo Summer Games and a rocky return to live, televised events in the U.S. to these simmering geopolitical tensions, and what used to be a marketing goldmine is now looking more like a potential brand safety problem.
The history of political boycotts at the Olympics is almost as old as the Games themselves. But as hard as the International Olympic Committee tries to keep politics out of the Games, doing so is more challenging in an increasingly connected but polarized world.
This year, a political cloud is likely to hang over coverage of the games, particularly in the U.S. and other boycotting nations, making for potentially awkward athlete interviews and uncomfortable brand alignments.
Brands, already under pressure for their business relationships with China, are on high alert. Already, official sponsors including Intel, Coca-Cola and Samsung have been called out by Western politicians and human rights activists for supporting this year’s Games.
While no advertisers have pulled out of the Games over diplomatic issues yet, media buyers tell me they are watching the situation and monitoring conversations on social media closely.
“These days, there's always the idea in the back of their head of, ‘Is this going to hurt my brand in any way shape or form?’” Stacey Stewart, U.S. chief marketplace officer at UM, tells me. “A lot will depend on what that brand is, what they stand for or if they've made public statements before.”
As consumers gain the power of their collective voices, some brands are opting to make bold, purposeful decisions in lieu of revenue opportunities. Look no further than The Golden Globes, which NBCUniversal declined to televise after the Hollywood Foreign Press Association received backlash for lacking Black members on its voting committee yet again.
Balancing geopolitical tensions specifically will continue to be a hairy issue for global brands in the coming decade, as the U.S. clashes with fast-growing authoritarian nations like China, which force companies to submit to their surveillance and oversight or suspend their operations completely.
Big Tech has been dealing with this balancing act for some time. Apple’s entire manufacturing supply chain is based in China and Taiwan, forcing it to make difficult tradeoffs around censorship and surveillance. On the other hand, Google, YouTube and Facebook have been blocked by the Chinese government because of the free flow of information enabled by their platforms, cutting them off from a massive emerging market.
Already, brands are starting to struggle with the purpose vs. profit quandary. Just this week, my colleagues in the U.K. reported that Unilever was called out by a British investor for “losing the plot” by “publicly displaying its sustainability credentials.”
He wrote in a note to investors: “A company which feels it has to define the purpose of Hellmann’s mayonnaise has in our view clearly lost the plot. The Hellmann’s brand has existed since 1913, so we would guess that by now consumers have figured out its purpose (spoiler alert — salads and sandwiches).”
I take his point, but I’m not so sure consumers, newly empowered to choose to shop with brands who align with their personal values, agree.
The Winter Olympics in Beijing is another test for marketers to balance the pressure to do the right thing with a business opportunity. The choice between purpose and profit is never easy, but it's one brands will increasingly have to make.