Ambush marketing is the hottest-trending market strategy used by companies to advertise and promote their brands in covert ways. The concept is more prevalent and popular among sporting events where companies capitalize to advertise themselves on the events, in which they are not an official sponsor. Basically ambush marketing refers to an attempt by a company to benefit from the popularity of a particular event by using ambush tactics to create a misconception of being officially associated with the event. This association is without permission and without paying for sponsorship, and the intent is to delude the customer into believing that there is an official association.

Opportunistic marketing or Legal infringement?

Let’s start from the basics, for organizing a sporting event, funds are required and what best way to collect money than sponsorship, and so companies enter into official sponsorships to help provide funding. As of late, sports events such as Cricket World Cup, IPL, FIFA, etc. are gaining high commercial stakes, for instance, the broadcasting rights for 2011 and 2015 Cricket World Cup was a whooping amount of $ 1.1 billion. Companies try to bid for the tag of “Official Sponsors” for such high-end sporting events as advertising and promotion at these events means a great deal of brand value. In one such instance, PepsiCo managed to rope in Title Sponsor bid for IPL-6 costing them Rs.400 crore for a five-year deal.

Consider the plight of these “Official Sponsors” who invest such humongous money but are left devastated by tactical ambush marketing strategies adopted by the non-official sponsors who manage to garner the audience’s attention.

Ambush marketing is considered by many as a double-edged sword, where on one end it is reflected as an opportunistic advertising strategy, but on the other it’s considered as an unfair and at times infringing practice. In the words of Delhi High Court, “Ambush marketing is opportunistic commercial exploitation of an event. The ambush marketer does not seek to suggest any connection with the event but gives his own brand or other insignia, a larger exposure to the people, attached to the event, without any authorization of the event organizer.”

Though the observation may seem to make a valid point but the implications are sketchy as it has been a growing concern that ambush marketing devalues the exclusive as well as expensive sponsorship rights which are sold to other companies and in some cases, even involve the infringement of intellectual property rights such as trademark or copyright. Considering the cut-throat competition among brands, publicity and advertising is a sine-quo-non for all companies and IPRs are valuable assets that are used as marketing tools towards the branding. With such IP rights and enormous sponsorship costs at stake, ambush marketing jeopardizes the whole scenario.

For ambush marketers it is a windfall as they can lure profits without bearing the financial burden of sponsorships, but event organizers and official sponsors it’s a scourge as sponsoring companies lose their advertising fortune and it also undermines the integrity of the event and organizer’s capacity to recoup future sponsors.

Need for Legislation

Presently there aren’t any express laws or provisions in existing legal regime to cope with ambush marketing and hence most of cases of ambush marketing seek shelter under Intellectual property rights infringement and the common law of passing off.

Passing Off- This common law relief can be sought against ambush marketers in case of unregistered trademarks. In order to succeed in an action for passing off, the claimant must clear the classical trinity test where he ought to establish that:

  • The claimant has goodwill;
  • The defendant made a misrepresentation that is likely to deceive/confuse the public and
  • The misrepresentation damages the goodwill of the claimant.

Trademark Infringement– Infringement proceedings can be initiated against the ambusher, provided the event organizers have registered their trademark and similar mark is being used by the unauthorized sponsor.

Copyright Infringement– This remedy is more likely to be sought for unauthorized replication by a third party of a specific logo created with respect to the event.

There have been instances where major sport events set forth a pre-requisite that the organizing country implement legislative measures to cope expressly with the menace of ambush marketing. In anticipation of the Cricket World Cup tournament 2003 and 2010 FIFA World Cup, a legislative measure was enacted by the South African Parliament during 2001 and 2002 which specifically dealt with ambush marketing. Also organizers of major events such as Olympic 2000 in Australia, Olympic 2008 in China, Olympic 2012 in U.K., have all either passed event–specific legislation or amended existing laws to contemplate protection of the official sponsors.

Coming back to the Indian perspective, there are only a few handful of ambush marketing cases where relief has been granted under either law of passing off or trademark or copyright. The only appropriate reference with regard to ambush marketing can be made to the case of ICC Development (International) Ltd. vs. Ever Green Station, where although the contention was infringement of copyright and a prima facie case of passing off, unfair competition, ambush marketing and violation of publicity rights, an injunction was granted against the defendant only on grounds of misuse of the world cup logo because there was a copyright infringement as the logo was held to be an artistic work under the Indian Copyright Act and the concept of ambush marketing was over-looked.

Amongst this lacuna of legislative measures for preventing ambush marketing, credit must be given to the International Cricket Council (ICC), which demands strict adherence to their ambush marketing clause, and clearly states that players have to stop promoting companies and products not related to the World Cup before the event begins. In light of these rules, famous Indian cricket team caption M.S. Dhoni was targeted for promoting and endorsing the brands Sony and Aircel, which were the rivals of ICC’s official sponsors for World Cup 2011.

The road ahead…

Ambush marketing is more than just an unethical business practice and pretty much attracts legal provisions of IPR infringements. In absence of specific legislation for ambush marketing, infringers tend to get away with unlawfully hitching upon the repute of the official sponsors, without having to bear sponsorship commitment. In view of the increasing cases of IPR infringement by ambush marketers, there is a resilient need for enacting specific legislations to counter Ambush Marketing.

If all goes well, India could be the venue for the most anticipated 2020 or 2024 Olympic Games and if so, the lacuna in Indian legislative front for ambush marketing will definitely be one of the major concerns for conducting the event.