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SBD Global/July 9, 2014/Marketing and Sponsorship

Russia Will Allow Beer Ads In Effort To Pump Fresh Revenue Into Sports

Russian Parliament's passage of a law to allow beer commercials during sports broadcasts is expected to pump fresh revenue into the country's sports business. Some experts, though, say the impact from the measure might not be significant. The move ends a two-year ban on all alcohol commercials. Duma Deputy Igor Zotov, who initiated the legislation, said, "I'd like to believe that thanks to extra cash coming in we'll see a totally different performance from our football squad, as well as improvements in other sports." The legislation was hastily passed in the wake of Russia's poor showing in the World Cup, where it failed to win a single match, and did not qualify for the knockout stage. With Russia hosting the next World Cup, many officials in Russia are concerned about the national squad's performance.

THE MONEY TRAIL: Beer companies could spend an extra 5B rubles ($145M) on TV commercials over the next four years, Vadim Drobiz, head of the center for research into the federal and regional liquor markets, told SBD Global. However, he added, that amount is unlikely to make a big difference. Drobiz said, "You need to keep in mind that 10% of that amount will be spent on production of commercials, and one half of the remainder will be paid to TV networks. And what is left isn't much. This is a purely political steps aimed at showing FIFA and its beer sponsors that everything will be fine with the World Cup in Russia. While the ban has been in place, Russia's national football squad has often chosen to play friendlies abroad so that liquor ads could be placed at the stadium and the football federation could cash in."
Vladimir Kozlov is a writer in Moscow.
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