McDonald's signs eight-year Olympic deal to include Turin, Vancouver Games

McDonald’s signs eight-year Olympic deal to include Turin, Vancouver Games{mosimage}McDonald’s has signed a new eight-year deal to sponsor the Olympics, ramping up its global approach to advertising and making a big push into China ahead of the 2008 Beijing games.

McDonald’s is racing to catch up with rival KFC, a subsidiary of Yum Brands that operates nearly twice as many fast food outlets across China as the hamburger chain.

The Beijing sponsorship ties in with McDonald’s plans to almost double its 580 outlets to more than 1,000 by 2008.

“That’s just a start for us,” McDonald’s chairman and chief executive Jim Cantalupo told a news conference in Beijing. “Any company that’s in a global business has to pay attention to China.”

McDonald’s has signed Chinese basketball star Yao Ming of the Houston Rockets as an official spokesman. His contract will include promotions tied to the Olympics.

Senior management said in Beijing that McDonald’s would extend its Olympic sponsorship to include the 2006 Winter Games in Turin, Italy; the 2008 Summer Games in Beijing; the 2010 Winter Games in Vancouver, Canada; and the 2012 Summer Games, whose venue has not yet been named.

McDonald’s is already a sponsor for the 2004 Olympic Summer Games in Athens, Greece.

Executives would not reveal the value of the deal, saying only it was significant. The new contract is the longest since McDonald’s became an official Olympic sponsor during the 1976 summer games in Montreal.

By extending the long-standing relationship, Oak Brook, Illinois-based McDonald’s said it aimed to build on themes it began late last year with the launch of its first global advertising campaign, “I’m Lovin’ It.”

“McDonald’s is going to be 50 years old next year as a company and we don’t want to look 50 years old or feel 50 years old to our customers,” said Cantalupo, a long-serving McDonald’s executive who was brought out of retirement in December 2002 to turn around the firm’s sagging profits.

The campaign aimed to link McDonald’s food with a youthful lifestyle, using commercials that feature hip-hop music and new packaging. Its comes as the company seeks to broaden the global appeal of its brand. The company operates more than 30,000 outlets in 119 countries.

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McDonald’s said the deal gave it sole marketing rights as branded food supplier at the events through 2012.

In addition to providing branded restaurant food at the Games, McDonald’s has rights to use of the Olympic rings in global marketing and exclusive sponsorship with the 201 national Olympic teams worldwide.

McDonald’s China executives, running the firm’s eighth-largest market worldwide by number of restaurants, said it had improved its market share and sales, but declined to give details. The hamburger chain trails fried chicken giant KFC, which already has 1,000 outlets.