July 21, 2021

Article at Washington Post

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In Japan, sponsors seek to distance themselves from Olympics ahead of Opening Ceremonies

TOKYO — With the Olympics mired in controversy and criticism just two days before the Opening Ceremonies, big business here has started to distance itself from the event. Following the lead of Toyota, Japan’s biggest business associations and some of its biggest companies have said their leaders would not be attending Friday’s Opening Ceremonies, which will take place in a newly rebuilt National Stadium without ticketed spectators.

In Japan, sponsors long had been privately discomforted by widespread public opposition to the Games, but until now, they had been largely silent publicly.

On Monday, Toyota Motor, which remains a leading worldwide sponsor, said it would not be airing any Olympics-related TV advertisements in Japan, in deference to the pandemic situation here, and its president, Akio Toyoda, will not attend the Opening Ceremonies.

“The Olympics is becoming an event that has not gained the public’s understanding,” a senior executive told the Yomiuri newspaper.

The impact was almost immediate. Toyota is Japan’s largest company, a major Olympic sponsor and a company with a reputation for being “conservative and cautious” — even by corporate Japan’s conservative standards, said Rochelle Kopp, a management consultant based here.

“Everyone’s been trying to say as little as possible [about the Olympics],” she said. “But the fact that Toyota has made a very careful decision about it, it paves the way for everyone else. It’s always easier in Japan to follow the lead and go with the crowd.”

Kopp said Toyota is a company that would be finely attuned to public sentiment but also wary of the risk that the Games could end up being a disaster.

“Even if it’s 10 percent risk of being a disaster, there’s a clear risk that I don’t think anyone can deny,” she said. “As a company, I think it’s the prudent course not to associate yourself too closely or any more than you have to.”

The country’s three largest business associations — Keidanren (the Japan Business Federation), the Japan Chamber of Commerce and Industry, and Doyukai (the Japan Association of Corporate Executives) — said their leaders also will not attend Friday’s ceremonies, according to media reports.

“I will cheer the athletes with my family at home,” Keidanren Chairman Masakazu Tokura said at a news conference Tuesday.

The fact that domestic fans are barred obviously made it much more difficult for business leaders to attend as VIPs, especially because cameras inevitably would be trained on them at some point.

The heads of Panasonic, another worldwide sponsor, along with Tokyo 2020 Gold Partners Asahi, Fujitsu, Meiji, NEC, Nippon Life and NTT also will not be attending, spokespeople told the Japan Times.

The situation with advertising is slightly more nuanced. Aside from Toyota, Bridgestone said it already had decided not to broadcast commercials here, but some companies will air commercials, according to the Japan Times, including NTT, Nomura and Mizuho.

Tokyo organizing committee spokesman Masa Takaya acknowledged the challenges that sponsors faced, given last year’s postponement and what he called the “mixed” public mood.

“These partners and sponsors must have been struggling to support Tokyo 2020” after the postponement, he said Monday. “And that one year was a pretty intensive and challenging situation, but still those partners and sponsors were always very supportive of Tokyo 2020.”

Each company, he said, had to make its own decision “in terms of how they should be able to convey their messages to the public from its corporate perspective.”

Kopp said many big Japanese companies employ current and former Olympians, partly out of a sense of civic duty and partly because they represent great branding. That makes it awkward for them to publicly criticize the Olympics.

Polls show a clear majority of Japanese people still don’t want the Olympics to go ahead. Concerns about safety remain high, and excitement about the events has been muted by the ban on spectators.

Outside Japan, sentiment is different. NBCUniversal said its advertising revenue around the Games is going to surpass the $1.2 billion generated in Rio de Janeiro in 2016.

That helps to explain why the International Olympic Committee, which gets roughly three-quarters of its revenue from broadcast rights and half of that from NBCUniversal, has seemed so determined to plow ahead with the Games, despite the pandemic risks.

“We are in a very strong position,” Mark Lazarus, chairman of NBCUniversal television and streaming, told reporters last month at a media event in New York.

This week, Toyota North America was quick to point out that the group’s media plans are set nationally rather than globally.

“In the U.S., the campaign has already been shown nationally and will continue to be shown as planned with our media partners during the Olympic and Paralympic Games Tokyo 2020,” it said.

NBCUniversal, in an email attributed to a spokesperson, underlined that Toyota is not adjusting any marketing plans for the Olympics.

“Nothing has been canceled or altered. Toyota is all systems go,” the spokesperson said. “No advertiser in the U.S. has asked to cancel their Olympics plans.”

Prashant Malaviya, a professor of marketing at Georgetown University McDonough School of Business, said brands sponsor the Olympics for reasons beyond exposure on television.

“It is also because, under normal circumstances, the Olympics are a source of great joy, great pride, lots of excitement, lots of laughter and maybe some tears but also tears of joy,” he said. “So to affiliate your brand with that kind of positivity is a huge boost to the brand.”