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Douglas Masters, managing partner of the firm’s Chicago office, examines the controversial world of ambush marketing. Often associated with major events, ambush marketing has evolved from a disruptive strategy to one that impacts the landscape of official event sponsorship. As part of our insider perspective series on advertising, Douglas explains ambush marketing, the risks and benefits of engaging in this tactic, the legal challenges to consider, and how event organizers can protect and strengthen the value of official sponsorship programs.
Tell us about your practice and the types of marketing and advertising matters you generally work on.
My practice focuses on the protection and enforcement of intellectual property (IP) rights, particularly in the areas of trademarks and copyrights. Given my representation of sports leagues and teams as well as brands that advertise in that area, an issue that comes up repeatedly is ambush marketing.
What is ambush marketing, and how have you witnessed it being implemented in the market lately?
Ambush marketing usually takes the form of a brand attempting to capitalize on an event by associating itself with the event without being an official sponsor. This marketing tactic often occurs with sporting events, but it can also happen on social media, where brands use the marks or other indicia of an event to promote its own products on signage or in sales locations in proximity to the location of the event, or in other marketing activities that evoke the event in ways that may suggest a sponsorship or affiliation.
Given its growth in popularity, what are the risks and benefits associated with ambush marketing strategies?
Sporting events in particular represent hugely popular marketing opportunities, which is why brands pay many millions of dollars to be associated with them (e.g., official [product category] of the [name of event]). Ambush marketers gain the benefit of exposure to that audience and association with the event without the sponsorship fees. However, the risks of engaging in ambush marketing may outweigh its benefits. Common risks include enforcement actions taken by the brands or official sponsors, such as threatened and actual legal action, obtaining a court order in anticipation of such activity to seize marketing materials and goods in proximity to the event as well as the enactment of local ordinances as part of securing the hosting of an event (e.g., bids for the Super Bowl) that provide for seizures and removal of marketing and advertising materials near the venue.
One interesting dynamic is the tension major brands face when dealing with ambush marketing. Brands that pay to be official sponsors want aggressively to stop others from associating with the event, as they have undoubtedly made a significant financial investment, but also they have dedicated substantial time to create campaigns around the official sponsorship. Conversely, non-sponsors may be tempted to find ways to get exposure to the large audience, sometimes without legal clearance. Addressing such ambushes promptly is often most effective, as companies and their legal team recognize the importance of maintaining a strong stance and not undermining their investment in an official sponsorship.
From a legal perspective, what can event organizers do to address ambush marketing?
Event organizers must address ambush marketing to protect the value of sponsorships. Sponsors don’t want to pay for exposure or marketing that other brands can gain access to for free. To maintain a successful sponsorship program, organizers need to demonstrate the benefits and value of paying to be officially associated with the event. That said, it often is hard to prevent or stop ambush marketing altogether. Some strategies for event organizers to consider include:
- Registering your key marks, including those for any merchandise or marketing you and your partners offer.
- Publicly communicating your guidelines for acceptable and unacceptable marketing tactics.
- Seeking court orders or local ordinances that give you the ability to shut down unlawful marketing in proximity to the venue(s).
- Providing non-infringing ways for marketers to reference the event—for example, the NFL aggressively controls the use of “Super Bowl” but allows everyone to refer to the “Big Game.”
- Being aggressive. Ambush marketers need to understand that you will not tolerate their activity. As you gain a reputation for enforcement, you will deter unlawful marketing and push those not affiliated with the event further away from use of the official designations.
Looking ahead, how do you see the role of ambush marketing evolving, and how is Loeb helping clients stay up to date on developments?
The proliferation of social media and advances in artificial intelligence (AI) portend a future with increased opportunities for ambush marketing. We are keeping clients informed on these trends and offering practical counseling to address these challenges. At the firm, we offer timely alerts on developments related to IP, AI, advertising and other topics. We also assist clients with different educational programs designed to help internal teams navigate these emerging challenges effectively. As the landscape of ambush marketing continues to evolve with technological advancements, staying informed and prepared is essential. At Loeb, we are dedicated to equipping our clients with the knowledge and tools necessary to adeptly navigate these changes and safeguard their interests.
