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SBD Global/June 10, 2014/Marketing and Sponsorship

World Cup Sponsors Hyundai, BP, Anheuser-Busch Add Pressure On FIFA

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Hyundai has become the latest top-tier World Cup sponsor to call for a "thorough investigation" into allegations that corruption and bribery played a part in the decision to award the hosting of the '22 event to Qatar, according to Rob Williams of the London INDEPENDENT. In total, five of the six FIFA "partner" sponsors "have now expressed concerns over allegations made in the Sunday Times." Hyundai joins Sony, adidas, Coca-Cola and Visa "in expressing concerns over the bidding process." Only Emirates has "so far declined to comment on the claims." Hyundai/Kia said in a statement, "We are confident that Fifa is taking these allegations seriously and that the investigatory chamber of the Fifa ethics committee will conduct a thorough investigation" (INDEPENDENT, 6/9). REUTERS' Keith Weir reported BP and Anheuser-Busch on Monday "joined the ranks of World Cup sponsors pressing football's rulers to tackle corruption allegations." FIFA "is struggling to contain the fallout from claims that bribery helped Qatar to secure the showpiece event." Sponsors who pay hundreds of millions of dollars for the "halo effect" of associating their brand with the World Cup "have broken with protocol and publicly demanded that FIFA get to the bottom of the corruption claims." In a statement, Anheuser-Busch said, "We are concerned about the situation and are monitoring developments; we expect FIFA to take all necessary steps to address the issue." Its Budweiser beer brand "has signed up as a World Cup tournament sponsor until 2022." BP, whose Castrol oil brand is sponsoring the World Cup in Brazil, said it expected FIFA to deal with the issue in a "right and proper manner" (REUTERS, 6/9).

FIFA RESPONDS: MARKETING WEEK's Sebastian Joseph reported FIFA has claimed its backers "have full confidence in the investigation." FIFA Marketing Dir Thierry Weill said, “We are in constant contact with our commercial affiliates including adidas, Sony and Visa and they have 100 percent confidence in the investigation currently being conducted by FIFA’s independent Ethics Committee. Our sponsors have not requested anything that is not covered by the on-going investigation by the Ethics Committee.” Sponsorship experts "question whether the brands could have arrived sooner with their statements, adding their union reflects a wider shift to sponsors holding rights holders to account in order to protect their reputation." Run2Work petition Founder Gordon Lott, a former London 2012 marketer for Lloyds, said, “It’s a defensive move by the sponsors who will have been well aware of the poor governance at the heart of FIFA for many years, and it is frustrating they haven’t represented the interests of their customers and fans sooner." Brand Rapport Dir Nigel Currie said, “Up until very recently sponsors would have avoided commenting on matters such as this and would have referred everything to the governing body. However companies and brands are now much more concerned with protecting their reputation and image that they are increasingly feeling the need to comment publicly" (MARKETING WEEK, 6/9). In London, Roger Blitz noted this is one of FIFA President Sepp Blatter's "most critical weeks of his 16 years as president." Blatter has "never had to confront such an open display of disquiet" from FIFA's financial backers. Sources close to the sponsors who issued statements said that they were "coordinated." A source said, "It is pretty obvious. The sponsors realize these repeated allegations are not good for anybody, not good for FIFA and not good for sponsors." The sourced added that FIFA "was feeling the pressure from sponsors" (FINANCIAL TIMES, 6/9).

PAYNE PENS COLUMN: Former IOC Exec Michael Payne wrote in the FINANCIAL TIMES the sponsors' decision "has added a new dimension to the developing crisis" at FIFA. In the final days leading up to a World Cup in Brazil, sponsors "would expect to be maximising the return on their investment by fine-tuning promotional and hospitality programmes, not moving into crisis communications mode and being forced to defend their partnerships." Neither FIFA nor its corporate partners "can afford a continued slow release of revelations." The "doomsday scenario for the companies is that the situation is allowed to drag on, turning one of the most powerful sports partnerships toxic." FIFA already "has its hands full dealing with the constant threat of match fixing, and is now being accused of turning a blind eye to the biggest fix of all: the choice of who gets to host its main event." Fifteen years ago, as marketing and broadcast director of the IOC, "I experienced a very similar crisis when allegations of inappropriate payments over the selection of Salt Lake City as host of the 2002 Winter Games began to emerge." At the time, the leadership of the IOC "understood the seriousness of the crisis but it was far from clear that all of its members did." Many simply saw the issue as an “Anglo-Saxon media debate” rather than a situation "that was threatening the heart of the organisation." However, when the sponsors spoke up and made it clear that future funding of the Olympics was at stake, "the problem could not be ignored" (FT, 6/9).

CHANGING GAME: The BBC's Bill Wilson reported global football sponsorship "is now much more than firms just handing over money to governing bodies such as Fifa for pitch-side promotion on billboards." The relationship "is now a much more textured one." Currie: "Companies and brands are becoming increasingly aware, and have an added push and impetus towards showing ordinary people they are aware that there is a social aspect to being a sponsor." According to one Brazilian analyst, the "big name sponsors are playing a more defensive game than usual." Rio de Janeiro-based sports marketing consultant Amir Somoggi said, "Some of the people and protesters on the streets are trying to put some of the guilt around the World Cup costs onto the sponsors. So sponsors are not launching their usual type of marketing strategies in case they are targeted by protesters. But for me, the blame for the increased costs should not be put on FIFA or the sponsors, but our politicians" (BBC, 6/8).

OFFERING ADVICE FOR BRANDS: In MARKETING MAGAZINE, Sao Paulo consultancy House of Jezmo's Jerry Clode wrote about why brands should address World Cup frustrations in Brazil. In it, Clode wrote with many Brazilians "disillusioned by the politics of the World Cup, brands need to be sensitive to aggravating local consumers." Brands "face a huge dilemma on how to present the tournament to disillusioned Brazilian consumers." In a context where many Brazilians "feel disillusioned by the tournament, brands need to be sensitive to aggravating or disrespecting local sentiment." Renault "is an example of a brand looking to address frustrations." Building on the marque’s "It’s Time" campaign -- "usually expressed comically through a ring-announcer screaming the slogan in your ear -- the brand has released a subtle but inspiring message ahead of the World Cup." Here "are three tips for brands looking to leverage the World Cup to connect with their Brazilian consumers:" Avoid "conflating the success of the Brazilian team with the success of Brazil." Suggest" a future beyond the World Cup, not a feverish focus on the event in isolation." Highlight "the internationalism of the event" (MARKETING MAGAZINE, 6/9).
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