SBD/August 25, 2011/Marketing and Sponsorship

New Zealand Fans Upset With Adidas Over Price Of All Blacks Jersey

All Blacks jerseys cost about twice as much in New Zealand as in the U.S.
Less than a month after adidas introduced the uniform New Zealand's national rugby team will wear in the Rugby World Cup, a controversy has "begun to build, bringing the vociferous passions of sports fans into conflict with the financial logic of a multinational company," according to Jonathan Hutchison of the N.Y. TIMES. Fans in New Zealand "discovered that the shirts were being sold online in the United States for about half the local price," and in the U.K. "for only slightly more than the United States price." Local news outlets "questioned why New Zealanders were being asked by Adidas ... to pay so much more than consumers in other countries for the official shirt of their own team." A few days "after the initial outcry, the furor escalated when news outlets reported that Adidas had told Internet retailers selling to international markets to remove New Zealand from their delivery options." The company "has since apologized for that decision and withdrawn the instruction, saying it had intended only to protect New Zealand retailers." Still, the "level of national outrage rose further." adidas met with retailers "but refused to reduce its wholesale price." Hutchison notes the controversy "does not appear to have hurt Adidas’s revenue in the short term." But New Zealand-based sporting goods retailer Rebel Sport Managing Dir Rod Duke indicated that "many customers had said they were planning to cover up the Adidas logos on their All Blacks jerseys." For adidas, the incident has become a "lesson in the risks of associating a corporate brand with a national obsession." The company said that it "had canceled a corporate event scheduled for Aug. 11 in light of the public relations predicament and removed branding from six company vehicles after staff members received threats and gestures from members of the public." David Huggett, adidas' country Manager for New Zealand, said, "We poorly handled the outpouring of concern from fans about the price" (N.Y. TIMES, 8/25).     

TECH CRUNCH: IBM has signed a "multimillion-pound deal" in the U.K. to sponsor ITV's coverage of the Rugby World Cup, which will be played in New Zealand from Sept. 9-Oct. 23. ITV will broadcast "each match live followed by an hour-long highlights programme." IBM’s multimedia sponsorship "includes a presence on air, online and on mobile platforms." The sponsorship "was negotiated by Mindshare" (CAMPAIGNLIVE.co.uk, 8/25).
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