One of Japan’s most prominent business leaders says the Olympics are losing their commercial value.
Suntory CEO Takeshi Niinami told CNN Business in an exclusive interview on Monday that his company decided against being a sponsor of the upcoming Tokyo Games, saying it was “too expensive.” “We thought of being an Olympic partner … but the economics didn’t match up,” said the chief of the Japanese beverage giant, which is home to brands such as Orangina and Jim Beam bourbon. Instead of signing on as an official sponsor, Suntory chalked out another route to increase its visibility during the Games, which start this Friday: the Tokyo-based company planned to tie up with restaurants and bars around the sporting venues to promote its drinks, and open several establishments to serve its products exclusively.
“I thought that this occasion would be very much a showcase for us,” Niinami said in Tokyo. “I expected a lot of spectators from abroad to visit.” The recent decision by organizers to bar spectators from the Games’ Tokyo venues over public health concerns scrapped those plans. “The economic losses will be enormous,” said Niinami, estimating that Japanese businesses could have enjoyed a roughly 10% hike in sales had fans been allowed. Having no domestic spectators could cost Japan’s economy 146.8 billion yen ($1.3 billion), according to an estimate by Takahide Kiuchi, an economist at the Nomura Research Institute. He noted in a June report that “much of the expected economic benefit from the Tokyo Games vanished in March, when it was decided to ban foreign spectators from traveling to Japan” — a move Kiuchi projected had already caused economic losses of $1.4 billion.