[비즈한국] As Jeonbuk State pushes for the 2036 Jeonju Olympics, attention is focused on whether Samsung Electronics005930 will extend its sponsorship of the International Olympic Committee (IOC). The rationale is that if Samsung Electronics, a flagship Korean conglomerate, sponsors the IOC, it could aid the bid for the Jeonju Olympics. However, with Samsung’s recent performance struggles, a massive sponsorship deal could be a significant burden.
Samsung Electronics first became associated with the Olympics as a regional sponsor for the 1988 Seoul Olympics. It later signed a contract with the IOC in 1997 and has been an official sponsor since the 1998 Nagano Winter Olympics. The current sponsorship agreement runs until 2028.
Jeonbuk State is currently pursuing the bid for the 2036 Jeonju Olympics. The race for the 2036 Olympics includes Ahmedabad-New Delhi (India), Nusantara (Indonesia), Istanbul (Turkey), and Doha (Qatar). Among these, Ahmedabad-New Delhi is considered the strongest candidate.
There is a sense of anticipation within the domestic sports community for Samsung Electronics to extend its sponsorship contract. The belief is that sponsorship from a major Korean conglomerate like Samsung could prove instrumental in securing the games. An official from the Korean Sport & Olympic Committee stated, "If there were signs that Samsung was planning to discontinue its sponsorship, we might request an extension, but as of now, no such movement is visible."
IOC sponsors are categorized into four tiers: TOP (The Olympic Partner, or worldwide partner), Premium Partner, Official Partner, and Official Sponsor. The 11 companies currently on the TOP sponsor list—the highest tier—include Samsung Electronics, AB InBev, Airbnb, Alibaba, Allianz, Coca-Cola, Deloitte, Omega, P&G, TCL, and Visa. Samsung Electronics is the only Korean firm among them.
Typically, the Olympic TOP sponsor list consists of around 15 companies. However, the number has recently dropped to 11 after companies like Toyota and Panasonic stepped away. Amid this, rumors have circulated that an Indian company has been pursuing an IOC sponsorship deal since last year. For example, Nita Ambani, wife of Reliance Industries Chairman Mukesh Ambani, led the opening of "India House" to promote Indian culture during the 2024 Paris Olympics. The Associated Press reported last August that "the IOC is expected to add an Indian sponsor in the near future as a sign of India's growing influence in the bidding process for the 2036 Summer Olympics."
Chairman Mukesh Ambani is considered Asia's wealthiest person. If he puts his weight behind the Ahmedabad-New Delhi Olympic bid, his influence cannot be ignored. It is widely acknowledged that the late Hyundai Group Honorary Chairman Chung Ju-yung and the late Samsung Group Chairman Lee Kun-hee played pivotal roles in the 1988 Seoul Olympics and the 2018 PyeongChang Winter Olympics, respectively.
Conversely, it is reported that Samsung Electronics originally planned to end its IOC sponsorship by 2020. However, the sponsorship was extended to 2028 in 2018. Some interpreted this as being influenced by the Moon Jae-in administration's push for a joint inter-Korean Olympic bid at the time. Former Democratic Party lawmaker Ahn Min-seok publicly stated on CBS's 'Kim Hyun-jung's News Show' in November 2018, "To my knowledge, the internal policy had already been set in 2016 (that Samsung would only sponsor the Olympics until 2020)," adding, "Since the leaders of North and South Korea agreed on a joint 2032 Olympics, it would be difficult for Samsung to ignore it." Brisbane, Australia, was ultimately selected as the host for the 2032 Olympics.
The issue is that Samsung Electronics' recent performance has been lackluster. While Samsung's revenue increased by 5.29% from 145.9839 trillion won in the first half of last year to 153.7068 trillion won in the first half of this year, operating profit plummeted by 33.36%, from 17.049 trillion won to 11.3613 trillion won. In an era of declining operating profits, a massive sponsorship commitment to the IOC is bound to be a burden. Although Samsung Electronics has not disclosed the specific sponsorship amount, it is known to be around $100 million (approximately 138.3 billion won) every four years. Furthermore, some analysts suggest that since the brand already enjoys high global recognition, there is no pressing need to spend such large sums on marketing.
Since the 2010s, there has been a trend of Samsung Electronics scaling back its sports marketing. The Samsung Securities tennis team and Samsung Heavy Industries rugby team were disbanded in 2015, and the Samsung Galaxy pro gaming team in 2017. Additionally, the advertising revenue received by the professional baseball team, the Samsung Lions, from Samsung Group affiliates has been decreasing year by year: 32.67747 billion won in 2022, 30.15933 billion won in 2023, and 28.67144 billion won in 2024.
On the other hand, there are substantial arguments that Samsung Electronics will indeed extend its IOC sponsorship. A business industry source remarked, "Samsung Electronics has been sponsoring the IOC for decades, and in the current climate where the Jeonju Olympic bid is being pushed, it would not be easy to stop IOC sponsorship, considering public sentiment." Samsung Electronics has not disclosed an official stance regarding its IOC sponsorship.