And the Gold medal goes to..Nike

Ambush marketing. The one thing the official sponsors were trying to avoid, with all the talk of 'brand police' at the turnstiles.  And yet, the Gold Medal of Ambush Marketing goes to Nike for their bright yellow-green running shoes.  They were one of the most prominent non-sponsors of the Olympics - and yet Nike managed to hi-jack the greatest show on earth with their amazing neon 'Volt' shoes.

Over 400 athletes wore Nike Volts in competition at the London Olympics and of those 400, 68 athletes won Olympic medals, including 25 gold medals

The man behind the Volt Shoe is Martin Lotti, Nike's global creative director for the Olympics . An industrial designer by education, he has been at Nike for 15 years. Painting Nike's Flyknit shoe Volt in that vivid way , was, he says, his way of creating a kind of "Team Nike."

Previously, the brand had matched the colour of the shoe to the color of the individual athlete's uniforms. Although the problem with that is that it blended in. This year, hundreds of athletes from different countries wore the same vivid colour

Nike used their own marketing assets (their shoes) - that belonged to them alone, and this gave this gave them a unique opportunity to take advantage of the Olympic rules.

Focus groups of amateur, college and professional athletes had been shown the shoe in different colours and, across the board, everybody loved the Volt, Lotti revealed .

There's a scientific reason for that. "It's the most-visible colour to the human eye." said Lotti.

Read the full background story here 

And for more on the running shoe itself...here

Olympic Winners and Losers

Sport has always played a large part in my life; whether it’s playing football in the park or watching Usain Bolt in the 100m final – the power of sport to engage and inspire is undeniable. (My personal favourite was the Brownlie Bros in the men’s triathalon..)

Following London 2012 there is now  a great debate on who won the marketing Olympics - which brands stood and out and which ones didn’t even make it off the starting blocks. But there is one thing that unites all brands involved - that they recognize the importance and power of sport and the passion it inspires in consumers.

So thanks to the BBC for raising the benchmark of sporting broadcasting. From their Olympic Trailer to their multi-channel coverage, the BBC where simply superb and their montages alone worthy of gold medals in editing and compilation.  And thanks also to the Royal Mail for reminding me to send a proper letter next time rather than an email.

It’s a shame then that it is unlikely Britain’s recession-hit economy will receive any boost from the Games that have been a triumph for the nation’s athletes. While Britain’s construction sector benefited hugely before the Olympics, experts have said the 17-day sporting spectacle had not delivered significant financial rewards and neither was it expected to in the months and years ahead.  Visitor numbers to London were estimated to be down 30%

In the run-up to the Olympics, commuters and tourists were warned to stay away amid fears that London’s transport system could not cope with millions of extra people descending on the capital. 

The London Olympic Games had long been heralded as a key boost to the British economy but in fact tourist numbers fell dramatically in the first few days of the Games. Hotels cut their prices and many shopping areas, restaurants, theatres, attractions and entertainment venues saw a significant reduction in business. Businesses complained of being sidelined as tourists headed only for the Games and avoided the capital’s other attractions and shopping destinations, while non-sports fans opted to stay at home or delay their trips.

Of course, we knew all of this already so why are officials now so surprised? 

http://www.fesmarketing.blogspot.co.uk/2011/03/london-2012-therell-be-trouble-ahead.html

Hopefully, the organisers of next Olympics in Rio will from the lessons in London….but why would they when London did not learn from the lessons of previous  Olympic cities and countries that went before them!

A Level Economics Pass or Fail?

As thousands of teenagers receive their A level grades, I am sure many of them would be able to do a better job of sorting out the economy than our present chancellor, who’s qualifications for the job include a degree not in Economics or Maths - but History..

We hear now that half of the economists who strongly supported the George Osbourne’s deficit-reduction-austerity plans are now asking for a rethink and urging the Treasury to take advantage of low borrowing costs to boost spending on infrastructure projects. 

Unlike George Osborne (and David Cameron) economists can see that the evidence now points to the need for a change of course. They know that without growth we can't get the deficit down – George Osborne is already forecast to borrow £150bn more than planned.

Output is now lower than it was when the coalition was formed two years ago while the Bank of England believes it will take until 2014 for gross domestic product to return to the peak reached in early 2008. The economy is expected to contract by 0.2% this year.

Roger Bootle, managing director of Capital Economics, said: "If I were chancellor at this point, I would alter the plan, I would stop the cuts to public investment and I might even seek to increase it. Supply-side reform might be welcome but what we're talking about here is a shortage of demand. The key thing is to try and get the private sector to spend its money and that may require a bit of government spending to prime the pump."

What he is referring to in simple terms is ‘the multiplier effect’

The Multiplier Effect

Every time there is an injection of new demand into the economy there is likely to be a multiplier effect. This is because an injection of extra income leads to more spending, which creates more income, and so on. The multiplier effect refers to the increase in final income arising from any new injection of spending.

The size of the multiplier depends upon household’s marginal decisions to spend, called the marginal propensity to consume (MPC), or to save, called the marginal propensity to save (MPS).  This in turn is largely dependent upon economic confidence.

When income is spent, this spending becomes someone else’s income, and so on. Marginal propensities show the proportion of extra income allocated to particular activities, such as investment spending by UK firms, saving by households, and spending on imports from abroad. For example, if 80% of all new income in a given period of time is spent on UK products, the marginal propensity to consume would be 80/100, which is 0.8.

The following formula to calculate the multiplier uses marginal propensities, as follows:

1/(1-mpc)

So, if consumers spend 0.8 and save 0.2 of every £1 of extra income, the multiplier will be  

1/(1-0.8)

= 1/0.2

= 5

This means the multiplier is 5, which means that every £1 of new income generates £5 of extra income.

The multiplier concept can be used any situation where there is a new injection into an economy for example when the government funds building of a new motorway or invests in a home building programme, as has been suggested.

Of course, there is also the downward or ‘reverse’ multiplier..

A withdrawal of income from the circular flow (austerity cuts, reductions in public spending etc etc) will lead to a downward multiplier effect which will further lead to a reduction of spending and economic activity...

Or in other words, just what George has been doing for the last year.

The Drum fauxlympics

Drum Magazine has been running a twitter and facebook campaign and competition called the #thedrumfauxlympics and the entries are some of the best spoof ads I've seen for a long time.

Have a look at all the entries here and cast your own vote on their facebook page.

Anti-Clockwise - better for right-legged athletes?

A great weekend of Olympic Sport and well done to ‘TeamGB’ on their medal tally so far, although I understand from an Australian friend of mine that actually ‘Silver is the new Gold’!  

Watching Mo Farah on Saturday night, I wondered why do they always run round the track in an anti-clockwise direction?  And, thanks to the BBC, here’s the answer:

According to a certain Paul Cartledge, professor of Greek History at the University of Cambridge, at Olympia and elsewhere in Greece both the running track and the hippodrome were straight, using up-and-back "laps" and even in the early modern Olympics - Athens (1896 and 1906), Paris (1900), St Louis (1904) - athletes ran clockwise.

At the time of the 1896 Games, most track races in England were also run clockwise and at Oxford and Cambridge University, both important athletic institutions, races also ran clockwise  (Oxford until the late 1940s and Cambridge until the 1950s)

But a number of countries began to settle instead on the American custom of running counter-clockwise... 

One theory is that early races were run on horse tracks, which ran in that direction. 

Anti-clockwise became the norm by the early 1900s and the Olympic organisers came under pressure to conform. The change was compete world-wide between between 1950 and 1954 and Roger  Bannister's four-minute mile was run in the anti-clockwise direction.

So we have the Americans to thank it seems – but does running anti-clockwise make a difference to left or right-legged athletes?

Answers on a postcard please.