The value of the deal is undisclosed but a spokesperson has said that when Adidas sponsored the 2002 Football World Cup in Japan and Korea, the brand increased its business in football by 30%. Business in the host countries also jumped 30%.
Under the deal, Adidas will have the rights to all footwear and apparel for all judges, volunteers and athletes in the torch relay. There will be more than 100,000 volunteers including ground staff and organisers working at the games. Adidas will also outfit 4,000 Olympic athletes through independent and team sponsorships and make equipment for 26 of 28 sports played.
Adidas has stated that the sponsorship will be more of a branding exercise than an immediate sales driver. However, the company claims that it hopes the brand awareness translates into sales in the longer term.
Jan Runau, spokesperson for Adidas, told the Financial Times: "It is the event where you can show an international audience that you're involved in sports. It gives you a lot of information about what Adidas stands for."
The company has outlined in previous statements that it hopes to increase net income for 2004 by at least 10% and sales by 3%-5%.
This year's Olympics are forecasted to help pick up the ad market according to WPP chief executive Sir Martin Sorrell. The Euro 2004 Football Championships and the US Presidential elections are also expected to boost adspend.
Microsoft will sponsor Team GB at this year's Olympics in a deal that sees it provide the British Olympic Association with software and technology.
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