Executive do so. It has become extremely

Executive Summary

Ambush Marketing is not a new phenomenon however its
impact has grown in recent years due the increased exposure of sporting events
like the Olympics and World Cup on TV and more new channels like the internet
and social media. This method involves a company associating itself with an
event which it does not have the rights to do so. It has become extremely
popular with marketing teams due to its low cost yet huge global reach. Many
believe that such practices are unethical and that they affect the real sponsor
financially and with regards to exposure. We can look at the ethical theories
surrounding ambush marketing and apply an ethical framework to the above issue.
Finally we will present a two sided argument on the topic in order to gain a
greater understanding why some companies engage in these activities.

We Will Write a Custom Essay Specifically
For You For Only $13.90/page!


order now

Introduction:

Ambush
Marketing has caused a lot of controversy in recent years. In the lead up to
every major sporting event, the organisers and main sponsors are aware of the
dangers and effects that ambush marketing can have but there is very little
they can do to stop it. There are two ways of looking at ambush marketing, on
one hand it is seen as theft, the ambush marketers take advantage of their
position and clearly gain attention without paying any compensation for it.
Others argue that ambush marketing is just a result of healthy competition and
that it is necessary for competition to exist in the modern world. Some
companies would never have the financial capabilities to match massive global
companies like Nike and Adidas so this may be the only way they can gain
exposure to a worldwide audience. 

 

Literature
Review:

Ethical marketing can be defined as practices that emphasize ”transparent,
trustworthy, and responsible personal and/or organizational marketing policies and actions
that exhibit integrity as well as fairness to consumers and other
stakeholders” (Murphy & O’Sullivan, 2005).

(Townley
et al , 2008) define ambush marketing as “Ambush marketing, or parasitic
marketing, consists, in the sports context, of the unauthorized association by businesses
of their names, brands, products, or services with a sports event or
competition through any one or more of a wide range of marketing activities”

Ambush
Marketing can be described as the process in which an unofficial sponsor of an
event associates themselves with that event in order to gain recognition or
other benefits (Meenaghan,
1998). Although on some occasions ambush marketing would
be seen as illegal, more often than not unauthorised association would not be
seen as illegal. It would be frowned upon in the industry in which it is being
used however this is not to say that big brands do not involve themselves
regularly.

(Meenaghan, 1996) breaks
ambush marketing down into 5 separate strategies

1. Sponsor Media Coverage of the Event

2. Sponsor a subcategory within an event and exploit
the investment aggressively

3. Make a sponsorship-related contribution to the
‘Players’ Pool.

4. Plan advertising that coincides with the
sponsored event

5. Innovative ambush strategies.

Crompton (2004) put forth seven categories of ambush
marketing techniques that cover the most often used practices. These include:
(1) sponsorship of the broadcast of the event, (2) purchasing advertising time
in and around event broadcasts, (3) sponsorship entities other than the
organizing body (i.e., teams and athletes), (4) purchasing advertising space at
locations that are in close proximity to the event venue, (5) thematic
advertising and implied allusion, (6) creation of a counter attraction, and (7)
accidental ambush

The main objectives of ambush marketing are to gain
the maximum return from the marketing budget and to steal the attention from
rival brands that have paid to the rights of sponsoring an event. It is
regarded as a smart way for the brand to gain attention as there are no laws
prohibiting the act.

An
example of ambush marketing in a digital sense would be in 1996 Olympic Games
in Atlanta. Nike used out of home advertising as a method of ambush marketing.
Nike projected a huge promotional banner on the side of a city skyscraper which
could be seen on the TV Broadcast which was screened to millions worldwide much
to the dismay of official sponsors Reebok. (McKelvey & Grady , 2008)

 

So who are the main Stakeholders in Ambush Marketing?

1.     
The
Event (i.e. World Cup)

2.     
Official
Sponsor of the Event

3.     
Unofficial
Sponsor

The
event will look for sponsors in order to generate money to help with the costs
of facilitating such an event. The London Olympics in 2012 cost in the region
of 14.5 billion to stage. The Olympics will look for sponsors to help promote
the event along with pay a pre-arranged fee to have these rights

The
official sponsor of an event will usually buy the rights to the events title,
signage rights and specific logos and emblems. They will use the word
“official” when promoting a product in the build-up and throughout the specific
event (e.g. Official Sponsor of the FIFA World Cup). The extent of the rights will
vary depending on the event.(Meenaghan,
1996)

The
unofficial sponsor engages in ambush marketing for a variety of reasons like 1)
it is too expensive to sponsor the event 2) The event has reached it maximum
number of sponsors 3) it may be blocked due to its pre-existing deal with a
competing brand (i.e. Nike v Adidas) (McKelvey
and Grady, 2008)

Ethical Theories

The
ethical question here is “Is Ambush
marketing viewed as stealing and thievery or the natural result of
healthy competition?”

We are going to examine 3 theories in relation to
this ethical issue.

                    

Utilitarianism

The Utilitarianism theory is the most commonly used
theory in digital marketing. It focuses on “creating greatest good for the
greatest number” From an ethical point of view Ambush Marketing certainly does
not create the greatest good for the majority. Ambush Marketing is just serving
the ambushers own self-interest and does harm to the greater good of the event
itself and its sponsors. Murphy states that “In an organizational context,
utilitarianism basically states that a decision concerning corporate conduct is
proper if and only if that decision produces the greatest good for the greatest
number of individuals. Good is usually defined as net benefits that
accrue to the parties affected by choice”. From an ethical standpoint the
ambusher only seeks to serve their own self-interest by exposing their brand to
the audience without paying anything for the privilege so this behaviour does
not benefit the greater good of the sport.

Duty Based Ethics

Duty based ethics can be seen as different to
Utilitarianism theory due to the fact that we are looking at the issue from the
decision makers point of view rather than the consequences of the decision like
in Utilitarianism. (Meenaghan, 1996) argues that the ambush marketer has a
moral duty to the company to meet its business objectives and gain a
competitive advantage over its competitors so that its stockholder returns are
maximised.

Virtue Ethics

Virtue Ethics takes a completely different approach
to the other theories we have discussed. It focuses on the company or business
rather than the actual decision like in Utilitarianism and Virtue Based. Virtue
ethics is seen as having good habits with moral values. By taking part in such
activities like Ambush Marketing would be rejected by this theory. Companies
are not seen as virtuous, it has seen resurgence in recent years with companies
now more inclined to be socially responsible. A company that is using virtue
ethics as a framework would view ambush marketing in a negative way and feel it
may tarnish the good reputation it has been building.

Evaluate the ethical topic using your chosen ethical
framework

“Is Ambush marketing viewed as stealing and thievery
or the natural result of healthy competition?”

Here I will use Blanchard and Peale’s ethical
decision-making theory which was first came to light in their book. It involves
the decision maker asking themselves three questions before making an informed
decision. I am going to run my ethical decision through this framework to
determine an outcome using the Utilitarianism Theory. I am using this theory as
it is the most widely adopted theory in digital marketing presently. (Blanchard
& Peale , 1991)

 Is it legal? 

This
question is to determine whether the dilemma you have is legal from a civil law
perspective but also from your own company’s policies and standards. If the
answer is no, then you should immediately stop and not proceed any further.
There can be major repercussions from engaging in ambush marketing in countries
were laws have passed that prohibit the act.

Ambush
marketing is technically legal in most countries although frowned upon in many quarters.
Each decision maker should look at their own company’s policies and standards
and make a decision whether to proceed or not.

 

 

 

 

 

2.      Is it balanced? 

 

We ask
ourselves is it balanced to determine is there fairness and rational behind a
decision. If I make a decision, will it heavily impact one party in a negative
way while having a positive impact on another party? It is not always feasible
to make a decision where everyone wins however the decision maker should try to
make a decision where the outcome is balanced.

With
regards to our dilemma, ambush marketing cannot be regarded as fair and
balanced. It has a heavily negative impact on both the event organisers and the
brand that paid for sponsorship right. It does not provide the greatest good
for the greatest number of parties and therefore should not be engaged in.

How
will it make me feel about myself?

This
question will focus on your own personal emotions and motives, it asks about
your sense of morality and weather you make a morally correct decision or not?

Would
you like if the decision you made was published on the papers in a negative
light? Would you be embarrassed or would your family be embarrassed. If you are
losing sleep over a decision you made, it is more than likely morally wrong.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Two Sided Argument

Ambush Marketing – Theft

Ambush marketing main criticism is that it can cause
huge frustration and anger to corporate sponsors who sign massive deals with
sporting event like the World Cup or Olympics but do not benefit exclusively
due to the acts of other companies using ambush marketing. (Murphy & O’Sullivan,
1998). For example, during the World Cup in 2010 Bavaria a Dutch beer company
got 36 blonde girls to attend a Holland game dressed in miniskirts that
displayed the brand name and logo. They were escorted out of the stadium after
40 minutes of the match Budweiser were the official beer sponsors to the World
Cup and this stunt caused huge controversy. Two females were arrested by South
African Authorities for being ring leaders of the group. It was argued that
Bavaria acted to the detriment to the official beer sponsor Bavaria by its
unauthorized ambushing of the event. By free riding the event by displaying
their logo they were deceiving the public about their association with the
event, they had then therefore damaged the exclusivity which the official
sponsor bud wiser had paid for. (Morgan, 2008)

Ambush Marketing can also have a negative effect
financially on the organisers of the events also. Sponsors will recognise that
there is always a threat that another brand may ambush a particular event and
they will use this to try to agree lower fees with the event organisers for
sponsorship of the event. If there is a case of ambush marketing at the event
this will just have effects again further down the line in regards to fees etc.
around sponsorship. (Townley et al  , 2008)

 

Ambush Marketing – Healthy Competition

We also need to look at Ambush Marketing from a
different point of view, it is mostly seen in a negative light at present but
some will argue that it is a result of fair competition. It can be argued that
when a company pays a sponsorship fee, it is buying the specific rights and
benefits relating to let’s say the World Cup however should they have control
to the rights to all of the public’s awareness of the event. Walsh stated that
ambush marketing is necessary in a modern competitive business world.

It is argued that the main issue here is the fact
that the main sponsors of an event pay for the rights while the ambushers do not
however for some companies sponsorship of a major sporting event would be way
out of their financial capabilities (Welsh, 2002)

 

Recommendations

Overall,
it would be very difficult to prevent ambush marketing across the board. In
this digital age there are more and more opportunities to engage in these
activities and less there can be done to stop it. However, there are certain
steps you can take to reduce the effects of any ambush marketing campaign on an
event you are sponsoring.

Buy
up any advertising space in and around the event location, also remember to
look at the various ways spectators come to the events like trains and roads
leading to the venue. You can use these spaces to advertise your brand as well
as taking the opportunity away from any potential ambush marketers (Shani &
Sandler, 1998)

If
you suspect a company to be engaging in “illegal” ambush marketing, don’t sit
back and watch it unfold. You should take certain steps like getting the
advertisement reviewed by a third party to see if it is infringing any of your
rights. If it is, you should take the matter to the relevant authorities.

 

Conclusion

Ambush Marketing doesn’t look
like it will be stopping anytime soon. At every big sporting event, more
companies are recognising the opportunity they have to gain huge international
exposure without paying the extortionate fee events are charging to be
associated with them. It is hard to blame small brands for jumping on the
bandwagon as they do not have the financial capabilities of the international
brands. (Cran & Griffiths, 2010) believes that the corporate sponsors are
getting to much protection from the law of the host countries. The freedom of
expression is undermined by these laws and as a result healthy competition has
been removed.

However (Murphy & O Sullivan,
19988) believe there is a need for regulation in the area. We will then be able
to distinguish between what is allowed and what is not. There should be a
certain amount of ambush marketing allowed in order for there to be competition
in the particular industry however this does not mean that it is a free for all
when it comes to marketing. The companies that pay for the rights should not be
left at a disadvantage and the laws should be there to protect them from
obvious cases of trying to confuse the public.

x

Hi!
I'm Isaac!

Would you like to get a custom essay? How about receiving a customized one?

Check it out