What Is Ambush marketing And Why It Matters In Business

As the name suggests, ambush marketing raises awareness for brands at events in a covert and unexpected fashion. Ambush marketing takes many forms, one common element, the brand advertising their products or services has not paid for the right to do so. Thus, the business doing the ambushing attempts to capitalize on the efforts made by the business sponsoring the event.

Ambush marketing explained

Businesses spend vast sums of money sponsoring large events relating to sport, entertainment, and education – primarily as a brand-building exercise.

Despite not paying for the privilege, competitors then gain access to these events and attempt to increase exposure for their own brands. This is ambush marketing at work.

Within ambush marketing itself, there exists direct and indirect ambush marketing.

Direct ambush marketing

A direct ambush describes the actions of a business that intentionally associates themselves with an event without the right to do so.

When Pepsi secured the sponsorship rights to the 1997 Pepsi Asia Cup, Coca-Cola made a deliberate and calculated play for the broadcast rights.

This gave Coca-Cola valuable exposure and left Pepsi unable to capitalize on their sponsorship financially.

Less antagonistic ambush marketing can also be seen in trademark and copyright infringement.

For example, the red cross logo that medical institutions use to market themselves globally is, in fact, a property infringement of the International Committee of the Red Cross. 

Indirect ambush marketing

Indirect ambush marketing involves a more subtle approach. The business concerned does not try to take advantage of the competitor who has paid for sponsorship rights.

Instead, it attempts to take advantage of the hype surrounding the event itself. Any possible affiliation between the ambushing business and the event is unofficial and left for the consumer to decide.

In the lead up to the 2012 Olympic Games, Irish gambling chain Paddy Power put up billboards claiming to be the “official sponsor of the largest athletics event in London.”

In much smaller print, however, they stipulated that the town referred to in the campaign was London, France.

The result was that Paddy Power was able to create marketing hype around the Olympic Games – since consumers knew which London was being referenced – while avoiding any legal ramifications in the process.

Advantages and disadvantages of ambush marketing

The most obvious advantage of ambush marketing is that it is low-cost and has the potential to be highly effective. In successful marketing campaigns, the exposure a brand receives will outweigh any fines or penalties that may be incurred.

Businesses who engage in ambush marketing also create associations with that event in the minds of their target audience. This increases brand equity or the perceived commercial value of a brand name over a product or service.

In terms of disadvantages, ambush marketing can sometimes involve heavy penalties or lawsuits that exceed the financial benefits of brand exposure. Since ambush marketing campaigns are relatively spontaneous and unpredictable, it is hard to predict return-on-investment (ROI).

Businesses who engage in ambush marketing must also be prepared for long, protracted disagreements with the business they are ambushing. These disagreements have the potential to erase beneficial exposure and needlessly eat into marketing budgets over time.

Key takeaways:

  • Ambush marketing describes the scenario in which a business ambushes a competitor’s event sponsorship arrangement in an attempt to gain more exposure.
  • Ambush marketing can be direct or indirect, depending on the objectives of the company and its ability to absorb fines or litigation costs.
  • Ambush marketing is a high risk, high reward strategy. It increases brand equity and is a cost-effective form of advertising. But the ROI is hard to predict and it can lead to public battles between organizations. 

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Published by

Gennaro Cuofano

Gennaro is the creator of FourWeekMBA which reached over a million business students, executives, and aspiring entrepreneurs in 2020 alone | He is also Head of Business Development for a high-tech startup, which he helped grow at double-digit rate | Gennaro earned an International MBA with emphasis on Corporate Finance and Business Strategy | Visit The FourWeekMBA BizSchool | Or Get The FourWeekMBA Flagship Book "100+ Business Models"