What the Tokyo 2020 Olympics Means for the Sports Industry

What the Tokyo 2020 Olympics Means for the Sports Industry

As Tokyo cheers for proudly being selected as the city to host the 2020 Olympics, the sporting industry also sets off into an eruption of excitement as a perfect marketing opportunity arises. It is not merely the surge of immense pride that a nation experiences in being able to host such a major event as the Olympics that rouses a crowd, but also the enormity of the publicity on an international scale that amps the viewership and participation in sports. The world’s eyes are set hard and consistently on the games for the short duration of around two-weeks. It is not merely the athletes’ performances that the viewers will be attentive to, but also the sponsors that the athletes will be representing and the commercials presented throughout the major event by large sponsors of the Olympics.


Aside from the general immense marketing opportunity the typical trend of the Olympic Effect has on a global scale, Tokyo as the announced host of the 2020 Olympics may actually spell for a particularly greater potential opportunity for the sporting industry.


The sports market in Asia has generally been considered to have the largest sector in sponsorship amongst others in the global community. Sponsorship is particularly an advantage for major events such as the Olympics because this not only allows for brand recognition, but also a deeper attachment and sense of loyalty to brands from fans through the surge of emotion running throughout the games. The sentiment correlated to the Olympic Games adds a certain brand value to the sponsors and while viewers may not be able to actually participate in these events, merchandising allows viewers to immerse themselves into the games to an assessable degree.


Recent trends have changed as now Asia has been experiencing a shift towards an increase in sports apparel and equipment consumption for the sporting industry market. As the economy rises alongside individual incomes, more individuals have time and money to spend on leisure activities such as hiking or camping. South Korea, for example, has noticed a significant demand for brand name sportswear. Just as locals in Seoul can be seen wearing the latest European luxury brand on the streets, seeing locals dressed in the latest high-end sportswear is becoming more and more common now. Since South Korea’s hosting of the Olympics in the 1980’s, people were inspired to improve their lifestyle and turn towards a more physical style of living. Even during the Asian financial crisis in 1997, despite the massive amounts of layoffs, the South Koreans were motivated to stay positive by “remain[ing] healthy for a comeback”, resulting in an increase in people participating in more physical activities. South Korea has since noted an explosion of market growth in the sporting industry from $1.1 billion in 2006 to $5.3 billion in 2012. Sports apparel has now become such a large trend in South Korea that it has not only swept the outdoor scene, but also the streets as more and more young trendsetters are being seen dressed in sportswear on the casual daily.


On another interesting note, domestic sports brand marketers in South Korea have been using professional athletes to model their brand, and have even partnered with local gyms and popular yoga professionals, allowing for the already popular aspect of sponsorship that allows sports industries to thrive in Asia to go hand-in-hand with this surge of consumer interest in sports apparel.


Japan is facing similar circumstances to that of South Korea as they begin preparing for the Tokyo 2020 Olympics and continue making efforts towards economic reform. As preparations follow for the Tokyo 2020 Olympics, this may provide an extremely lucrative opportunity for international sports manufacturers. By beginning to participate in the Japanese market, sports manufacturers will experience an even greater increase in sales by meeting consumer demands reinforced by the hype of the Olympics.


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Sarah Chung
Associate, International Relations Office/Asia Desk
World Trade Center of San Diego