The Invisible Hand Behind the Tokyo Olympics

[ad_1]

TOKYO – Not an official sponsor of the Olympics. It will remain invisible to the millions of viewers who started tuning this week. But without it Tokyo Games it couldn’t have happened.

The power behind the Olympic veil is Dentsu, an advertising giant with almost legendary power and influence in Japan.

As the gatekeeper to the world’s third largest economy, he has become a key figure in international sports. It played a key role in Tokyo’s Olympic bid, after which it was named the Games’ exclusive advertising partner and earned a record-breaking $3.6 billion from Japanese sponsors.

With almost complete control over Olympic marketing bounties, Dentsu has become Japan’s biggest winner of this year’s Games. But as the pandemic messed with the event, a company accustomed to always getting to the top finds itself in an unusual position.

The expectation of a massive decline has faded. Advertising campaigns and promotional events by sponsors, often in the months before the Olympics are canceled or collapsed, are one of the most lucrative parts of sports competition, depriving Dentsu of what analysts say.

As the Olympics were about to begin, some of Dentsu’s biggest clients began to withdraw. Toyota, one of the top sponsors, said on Monday that it will not air Olympic-themed television commercials in Japan during the Olympics, reflecting concerns about a possible public backlash against companies undertaking the event.

For customers who continue their Olympic advertising campaigns, Dentsu faces a serious test in message control. surveys It shows that about 80 percent of the Japanese public oppose the holding of the Olympics, which was postponed for a year and will now be held in Tokyo during the state of emergency.

“What kind of message are you sending right now? It’s a really tough question and the sponsors are definitely getting annoyed by it,” says Osamu Ebizuka, a veteran of Dentsu’s sports marketing department and now a visiting professor in the business management department at JF Oberlin University in Tokyo.

Asked how he would shape his clients’ approach to the Olympics, Dentsu said he was “not sponsored” and therefore “not in a position to comment”.

Despite its challenges, Dentsu remains a unique force in Japan. It is by far the country’s largest marketing firm, holding about 28 percent of the country’s broad advertising budget.

Dentsu began life as a news agency in 1901 before realizing that it was more profitable to package its content with advertisements. At the start of World War II, it was combined with a state-run news service that made propaganda for Japan’s Imperial Army.

Under the US occupation, the organization was split into three divisions: the advertising agency Dentsu and Japan’s two largest news services Kyodo and Jiji Press.

Since then, Dentsu has become affiliated with almost every major corporation in Japan. In addition to his many corporate and media contacts, he has served as the unofficial communications department of the ruling Liberal Democratic Party for more than 75 years, almost constantly in power.

Conspirators sometimes refer to the company as Japan’s CIA; A puppet master who uses his vast network to gather information and shape the country’s destiny.

Writer Ryu Honma, who started writing about the company after working at rival Hakuhodo, said the comparison was fictitious. But the company has arguably established itself as Japan Inc. made indispensable.

Dentsu is the nation’s mechanic, with a reputation for getting things done no matter how difficult. For years it was known for a ruthless work ethic expressed in a belief called the Ten Commandments of Satan, which instruct employees to “never quit a job, even if it kills you.”

Its clients are who corporate Japan is – Dentsu likes to say it’s part of a list that includes 95 of the world’s top 100 advertisers. It recruits members from Tokyo’s top universities and is said to favor the children of politicians, celebrities, and industry giants.

While most advertising companies outside of Japan avoid conflicts of interest by representing only one company in any industry, Japanese firms are generally less exclusive. Dentsu often works for competitors in the same industry, which is one of the keys to ubiquity.

Dentsu offers almost any communication-related service. Dentsu ad executives sell Dentsu-managed ads, starring actors represented by Dentsu, to TV stations where Dentsu manages ad sales.

The company buys all airtime blocks before selling them to fill the ads. His influence on television advertising is so tight that Japan’s competition regulator warned him twice.

It has a significant impact on both broadcast and print traditional media, which are afraid of offending the company and its customers for fear of losing their advertising dollars.

Dentsu’s TV dominance has made him an indispensable partner for Japan’s political class. It was Dentsu – again a Dentsu customer – who convinced Prime Minister Shinzo Abe to attend the closing ceremony of the 2016 Olympics in Rio de Janeiro by dressing up as the character Mario from Nintendo’s video game franchise.

Sports have long been a critical part of the company’s business. Michael Payne, who has led the marketing division of the International Olympic Committee for years, said Dentsu was one of the first advertising agencies to understand how international sporting events can raise the profiles of customers abroad and help them enter new markets.

Dentsu leverages its role as a conduit for Japanese advertising dollars to become an integral part of global athletics and swimming funding, while developing strong relationships with football’s governing body FIFA and Major League Baseball, among others.

The company’s ties to the Olympics date back to the 1964 Tokyo Games, where Dentsu was responsible for public relations. The games had not yet been commercialized, and Dentsu’s role was more of a sign of his reputation and political influence.

But in 1984, when the Los Angeles Olympics became the first country to rely entirely on private funding, Dentsu rushed to bring its corporate clients into the mix.

Dentsu took the lead in the bidding process when Japan hosted its second Olympics, the 1998 Winter Games in Nagano. And when Tokyo decided to compete for the 2016 Summer Olympics, the company was the obvious choice.

Following a Dentsu-led bid, Tokyo lost to Rio de Janeiro after a bid that was widely criticized for unfairly and exorbitantly over-budget. Regardless, Dentsu stood out and pocketed almost 87 percent of the Tokyo committee’s spending. government trial then.

Consultant Nick Varley, who was assigned to direct the presentations, said that concerns about the company’s 2016 performance did not prevent it from playing a significant role in its 2020 proposal.

The bidding committee assured him that Dentsu would not be involved, he said. But when he got his contract, he was surprised to see that it was a deal with Dentsu.

Ostensibly, Mr. Varley said, at least Dentsu provided mostly logistical support and handled the local side of the campaign.

But behind the scenes, the situation looks darker.

French authorities have spent years investigating allegations of corruption surrounding the Tokyo 2020 tender process. Questions include the role a powerful former Dentsu employee plays in lobbying with people with long-standing connections to the company to influence the outcome.

The scandal led to the incident chief resignation From the Tokyo Olympic Committee. Dentsu said he had nothing to do with the matter.

Regardless of how the games were won, the company made a tremendous profit. Within a year, the Tokyo Olympic committee selected Dentsu as its marketing partner, following a bidding process that competitors defined as a predetermined outcome.

The first thing Dentsu did was break the tradition of only one company representing each product category. While past Games have only been sponsored by a bank or an airline, Tokyo 2020, for example, is sponsored by two of each. This allowed Dentsu to use its connections to persuade nearly 70 domestic companies to pay over $3 billion to support the Games.

“The Tokyo Games have been implicitly referred to as the Dentsu Games among us in the business world—it’s not in any way derogatory,” said Terrence Burns, a sports consultant and former International Olympic Committee executive.

“If you’re going to do sports marketing business in Japan, they’re honestly your first and last stop. They hold a lot of cards,” he added.

Dentsu needed a win. It has struggled to keep up with the rise of digital media. It was damaged by a major overcharging scandal and a high-profile suicide linked to the company’s busy work culture. And, even before the coronavirus, the firm sending casualties.

But when the pandemic hit, Dentsu’s Olympic bet fell through. The company’s former director, Mr. Ebizuka, said the exact financial impact on Dentsu remained unclear, but there was no doubt that it was “suffering”.

Mr. Ebizuka said that for now, all Dentsu can do is hope for the best and try to help its clients deal with the uncertain situation.

They have no choice but to send a “fine message”, he said, “Let’s look to the future and get through the pandemic together.”

[ad_2]

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *