Going for gold: the 2012 Olympic merchandisers

London mascots lead the way to souvenir sales of up to £1bn

Wenlock and Mandeville get little love. The criticism of the London 2012 Olympic and Paralympic mascots has veered between the magnificent ("they look like the consequence of a drunken one-night stand between a Teletubby and the Michelin man") and the slightly bizarre ("patronising rubbish").

Yet London 2012 organisers believe that the gruesome twosome will lead the merchandising push and take total sales of Olympic key rings, soft toys, stickers, backpacks and limited-edition playing cards to £1bn. About £80m of this will go directly to the games organising committee and be put towards the £2bn operating budget.

Dedicated London 2012 souvenir shops can now be found at Heathrow Terminal Five and Paddington and St Pancras rail stations.

The Department for Business held an exhibition last week celebrating the paraphernalia and the companies behind their manufacture. Mark Prisk, a Business minister, gushed: "The UK companies on display here, and thousands more, are using London 2012 to export their products and services around the world as well as expanding their companies and employing more people."

As the previous five summer Olympics show, merchandising has become big business.

$163m

Beijing 2008

The Beijing Organising Committee developed more than 2,000 products bearing the Games logo – including T-shirts, caps and bags – with a total of 10,000 licensed stores selling the products. More than 60 companies became sponsors or partners of the Beijing games, and Olympic-related advertising in China alone reached an estimated $4bn to $6bn, according to CSM, a marketing research firm. Companies became "official noodles sponsor" or the "official leather goods supplier". Sponsors and merchandisers targeted the 300 million middle-class Chinese consumers as well as the overseas visitors for the games. The five "Fuwa" good luck dolls – representing among others a giant panda and a Tibetan antelope – helped to bring in a record merchandising revenue from licensees of $163m. Beijing even launched an Olympic Expo during the games, demonstrating how sophisticated the Olympic movement's marketing strategy has become since it first introduced official mascots in Munich 36 years earlier.

$17.2m

Barcelona 1992

This was arguably the last games of the non-commercial era, though some would point to the huge leap in broadcasting revenue for the 1984 Los Angeles games as the key change in the Olympic movement's ambitions. Like the Seoul Olympics four years earlier, revenue from licensee merchandising at Barcelona was less than $20m. From 1996, no games would make less than two and a half times that amount. Still, the organisers experimented with ways of turning CoBi, the Picasso-inspired sheepdog, into the face of the games, even launching his own television series, The Cobi Troupe. The International Olympic Committee (IOC) seems to have pinned most of its merchandising hopes on philatelists and numismatists: a 1,230,000 stamp series bearing the Olympic rings was issued in 137 countries, while 624,000 silver and gold coins were sold for $49m. In retrospect, Barcelona was possibly a merchandising opportunity missed: more than nine out of 10 people in Spain, the UK and US tuned into the games.

$61.5m

Athens 2004

Phevos and Athena were supposed to resemble seventh-century BC terracotta dolls and were named after Phoebus Apollo, the god of light and music, and Athena, goddess of wisdom and patron of the city of Athens. The mascots upset the Greek Society for the Friends of the Ancients which threatened to sue Athens organisers, claiming the revered names for the mascots were a mockery of ancients. The Greece and the Athens Olympic Organising Committee raised barely $60m in Olympic licensing and merchandising – just 2 per cent of budgetted revenue. In contrast, broadcast revenue was nearly $1.5bn after a record 220 countries and territories televised the event.

$52m

Sydney 2000

Only the commercially driven Atlanta Games had more licensees than Sydney's 100. Mind you, with three mascots there was a lot more scope for products to sell. Millie the echidna, Olly the kookaburra (above) and Syd the platypus represented earth, air and water, but they failed to represent big money and licensee revenue virtually halved to $52m. It didn't help that the good-natured trio got savaged by the unofficial mascot, Fatso the wombat, who spoofed the trio on Australian television. However, Sydney did pave the way for modern merchandising techniques, with online retailing used for the first time and products coded with the DNA of renowned Olympic athletes to ensure authenticity.

$91m

Atlanta 1996

Olympic mascots have always faced criticism, with few being adored bar Moscow's Misha the bear. But as Olympic mascots go, Izzy is a candidate for the most disliked. One sports commentator said it resembles "a genetic experiment gone horribly wrong". Despite the attacks, it was reported at the time that $250m worth of Atlanta mascot merchandise was sold. The Atlanta Committee for the Olympic Games opened a dedicated shop, the Olympic Experience, to sell merchandise competing with other street vendors and retailers. More than $800m of merchandise was sold in the run-up to the games, of which $91m went to the organising committee.