Charles Wijeratna, Director of Commercial Negotiations at The London Organising Committee of the Olympic Games (LOCOG), described the London 2012 Olympic Games as "similar to holding 26 Wimbledon championships all at once!" during an IESE Continuous Education session held on July 8 at the British Olympic Association headquarters in central London.
The scale of the event in terms of logistics, sponsorship and participation is undoubtedly huge. So how are the preparations faring?
Speaking to an audience of 60 IESE alumni and guests, Wijeratna provided a "behind the scenes" insight into the fundraising and sponsorship ordeal involved in the organization of the 2012 London Olympic Games. "We are delighted to have raised £653m in local sponsorship deals and now only stand at £47m from our target." He described the tender process and bidding system used as key reasons behind the fundraising success which designed a simple 3-tiered sponsorship package system. Among key sponsors for the event are Lloyds TSB, Adidas, BT and Coca Cola, among many others.
But haven't LOCOG's sponsorship endeavors been affected by the economic downturn? Wijeratna admits that fears of the difficulty of raising funds did not escape them: "We are very pleased to have started early in 2007. Some of our major sponsors may not have committed as much if we had been asking in 2009. But the power of the Olympics is incredible - everybody wants a piece!"
Companies want to be involved for the values the Olympics represent - striving for excellence, humanity coming together, respect for others - but also for the benefits to their company in terms of employee motivation, recruitment and attracting talent and the B2B opportunities created with other sponsorship companies: "Companies want to show that they can collaborate with or provide services during the Olympic Games to prove they can perform on the world stage," says Wijeratna. In 2009, Lloyds TSB received 33 percent more revenue from fellow Olympic sponsors.
Wijeratna also highlighted the transformation of East London in the run-up to the event. "This is not just a world class event that will come and go. It is an investment in one of the poorest areas of the UK and we want to ensure that the benefits are here to stay," says Wijeratna.
This sentiment was shared by Chris Daniels, President of the UK Chapter and Head of London 2012 Activation for the Wholesale Division of Lloyds Banking Group, the first sponsor to sign up.
Daniels opened the session by introducing Charles Wijeratna and Prof. Mario Capizzani, IESE, and then went on to briefly describe the significance of the Games for London. He describes how the Olympics will be organized in four of the poorest boroughs in London, where unemployment is as high as 33 percent and English is the second language for many.
"Continuity is key - we don't want the Olympic facilities to become disused after the Games, as happened in Athens." Daniels explained that he sees the Barcelona 1992 Games as having set a benchmark: "The reason the Olympics in Barcelona were so successful was because of their centrality. London is aiming to achieve the same."
Prof. Capizzani, moderator for the session, gave a brief overview of Olympics Games past and how London compares in terms of budget and revenue. He explained how broadcast revenues experienced a growth rate of 35 percent from 1994 to 2008 and why it is important to tightly monitor infrastructure costs: "Infrastructure costs ranged from £2bn in Sydney to £40bn in the Beijing Olympics. London is hoping to come in halfway."
Following the session, participants were in no rush to head home as they enjoyed the warm summer evening, networking with other alumni and the pleasant surroundings of the British Olympic Association, as well as a display of torches from previous Olympic Games held around the world.
