SBJ/June 17-23, 2013/In Depth

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  • Sponsors map out activation strategies

    The 2014 FIFA World Cup in Brazil is being viewed by sponsorship executives in a different, broader light.

    “In our communication with clients, I can tell you that we see the 2014 World Cup as the first mainstream FIFA World Cup platform,” said Simon Wardle, the executive vice president and chief strategy officer for Octagon Worldwide, which is managing activation and hospitality programs at the tournament for Budweiser and Johnson & Johnson, among other FIFA and U.S. Soccer Federation sponsors.

    While Coca-Cola is still finalizing its plans, the company has been visible in Brazil, including on this display featuring the World Cup mascot outside a store in Porto Alegre.
    Photo by: Getty Images
    “Historically, our clients and our company have used the World Cup as a Hispanic platform, but no longer,” Wardle said. “We’ve reached a critical mass — with the viewership data from the 2010 World Cup in South Africa, the increased accessibility of the sport, the growth of the sport in the U.S., NBC and Fox’s investment in soccer — where it is now viewed as a legitimate mainstream activation platform with the grandest of stages.”

    Longtime World Cup marketers and first-timers agree that the stakes next year in Brazil, where the tournament will take place from June 12 to July 13, will be high.

    “The event is a year away, and we’ve already been working on it for a year,” said Eelco van der Noll, head of global sports and entertainment for Anheuser-Busch InBev. “The challenge for every sponsor in Brazil is: How do we use the World Cup to amplify our brand? Off the pitch, we want to be the most recognizable, active, meaningful sponsor for everyone who is the legal drinking age and above. We want to enhance the experience of the consumers beyond the viewing of the games.”

    Van der Noll will manage activations at his sixth men’s World Cup. At the event in 1994 in the U.S., he was with Canon. In 1998 (France) and 2002 (Japan and South Korea), he was with MasterCard. After spending the last World Cup as the head of marketing for FIFA, he will lead Anheuser-Busch’s activation for both its Budweiser brand and Brazilian beer, Brahma. His advice to colleagues comes after years of lessons learned.

    “The World Cup is a huge opportunity for any sponsor, but it’s also a huge thing to deal with,” said van der Noll. “The biggest takeaway that most sponsors get from their first World Cup is not to do too much. Keep it simple, customizable, and make your message clear. Don’t spread yourself too thin with a hundred tie-ins that take a lot of time and resources but in the end do not pay off. Less is more.”

    While both van der Noll and A-B InBev have been involved in World Cups for a long time, Liberty Seguros — the Brazilian subsidiary of Boston-based Liberty Mutual insurance company — is sponsoring its first FIFA World Cup.

    “It may be a year away, but we are already feeling some butterflies in our stomachs,” said Adriana Gomes, the
    McDonald’s will again feature a program that allows children to walk onto the field with players for each match. The children shown above were selected to walk with the Brazilian team during the 2010 World Cup in South Africa.
    Photo by: AP Image
    marketing director of Liberty Seguros, which is designated as one of five FIFA national supporters. “We’re looking to build brand awareness, and World Cup is the biggest platform you could possibly have. But we also see this as a benchmark for future sports sponsorship for Liberty Seguros. If the event is as successful as we expect it to be, it could lead to more sports sponsorship for our company.”

    Marketers were hesitant to share specific activation plans a year before the World Cup in Brazil — “You’re always worried about competitors looking over your shoulders,” van der Noll said — but some were willing to give a peek.

    For the third straight World Cup, McDonald’s is bringing back its player escort program, where children walk onto the field holding hands with players before every match. McDonald’s global sports marketing executive Brian Goldstein estimates that more than 1,400 children will be player escorts in Brazil. Registration for the contest will begin this year at the more than 34,000 McDonald’s restaurants in 118 countries. Goldstein said that the company’s markets are in the process of determining their participation at the World Cup and will identify a selection criteria specific to each country.

    “The program is all about making dreams come true and is part of our commitment to children, encouraging them to participate in sports and inspire creativity while giving them an unforgettable experience,” Goldstein said.

    Brazil will mark McDonald’s sixth World Cup as a sponsor. Among its other activations will be McDonald’s Ultimate FIFA World Cup Fan contest, where entrants compete online to prove they are the most passionate fans of their national teams. Winners receive a trip for two for the semifinals and final match. It also will sponsor McDonald’s FIFA Fantasy Football, which the company said attracted more than 1 million players during the 2010 World Cup in South Africa.

    Arnab Roy, director of football marketing at Coca-Cola, said the company’s global activation for World Cup will launch in phases later this year.

    “Football is easily the No. 1 global passion and the FIFA World Cup is the biggest sporting platform,” Roy said. “It has been a proven asset within our system to drive brand love and brand value.”

    Itaú Unibanco, a Brazilian bank and FIFA national supporter, will host a contest in which two fans can win the opportunity to attend the post-match news conferences after each match. At Unibanco’s activation sites at each World Cup stadium, fans will receive bank and World Cup-branded merchandise. One fan, judged to be the most creatively dressed, will be selected by the bank’s marketing team to attend the news conference with a guest.

    “The idea is to encourage fans to enter the game looking like a normal person, and use the merchandise with a creative flair so they leave the game looking like a World Cup fanatic,” said Andréa Pinotti Cordeiro, marketing director of Itaú Unibanco.

    Like many of the properties sponsoring the World Cup, Itaú Unibanco is using the tournament’s highly prized tickets as rewards for customers and employees. Itaú Unibanco has more than 600 pairs of tickets to give away.

    FIFA World Cup sponsors are entitled to a commercial restricted area near the turnstiles at each of Brazil’s 12 World Cup stadiums. In the case of A-B InBev brand Budweiser, one of eight companies designated as FIFA World Cup sponsors, the areas will be used to expand service to consumers who will already have access to drink Budweiser and Brahma at Aramark’s concession stands.

    “We’ll have beer gardens at each stadium — with the all-important Wi-Fi,” van der Noll said. “Fans can come to our space and vote for the Budweiser Man of the Match.”

    While finding hotel rooms has been a challenge for many sponsors, Anheuser-Busch is taking over the Pestana Rio Atlantica hotel in Rio de Janeiro, adjacent to Copacabana beach. The hotel will serve as A-B’s headquarters for guests and for executives coordinating activities around the World Cup.

    Some companies will use the services of famous soccer players at their activations. For example, the former Brazilian star Cafu, a member of World Cup championship teams in 1994 and 2002, will make appearances on behalf of Liberty Seguros.

    Yingli Solar, a FIFA World Cup sponsor, won a competitive bid to build 1,500 solar panels adjacent to Estádio do Maracanã, the host stadium for the World Cup Final and other matches. Yingli will activate with a social media campaign on Instagram, Facebook and Twitter called “All Under One Sun.” At Yingli’s commercial restricted area, fans will be able to charge their mobile devices at the company’s solar stations.

    Asked what would make the 2014 World Cup a successful platform for Yingli Solar, marketing communications head Helena Kimball said, “Proof that we built awareness — coverage in the media, an increase of Yingli Solar searches on major engines, website visits, sales increases. We will monitor everything. We’re very optimistic because South America represents a real budding market for solar energy.”

    Although preliminary plans may be in place, sponsors of the U.S. men’s national team will have to wait as late as September to see if the club qualifies for the World Cup.

    Tracy Drelich, the associate manager of sponsorships and promotions for BP Lubricants, the parent company of Castrol Motor Oil, would not discuss Castrol’s plans for activation around the U.S. team in Brazil. (Castrol is also a FIFA World Cup sponsor.)

    However, Castrol has been activating around the U.S. team during its exhibition matches and World Cup qualifiers this year and many of its programs could be utilized next year in Brazil. The Castrol Correspondent contest gives fans 18 and older an opportunity to explain in brief videos posted to Facebook why they should be chosen to report on the U.S. squad. If the U.S. qualifies for the World Cup, the winning correspondent — chosen by Facebook fans and Castrol executives — will attend the team’s first three matches at the World Cup. Castrol is also the sponsor of a “Road to Brazil” web series of videos on the U.S. team.

    Octagon’s Wardle said that the U.S. team’s increased presence on ESPN and press coverage has made the team highly marketable.

    “There is a lot of American interest in the U.S. team,” Wardle said. “Marketers have seen that they are drawing in the casual sports fan. Americans want to get behind the red, white and blue.”

    FIFA sponsors like Castrol have an edge in preparations for next year’s World Cup because they are currently activating at the 2013 FIFA Confederations Cup, an eight-country tournament that began in Brazil over the weekend and continues until June 30.

    “Confederations Cup is a pilot test for everything — activation, fan engagement, ticket distribution,” said Alexandre Leitão, president of Octagon Brazil.

    The Confederations Cup also signals the start of the countdown to the main event. The buildup in Brazil is palpable.
    “In Brazil, the World Cup has already begun,” Leitão said. “In the business space, plans have been made, ideas are being tested, projects are being finalized. I’m confident that this is going to be an amazing World Cup for fans and for businesses.”

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  • Hospitality sales brisk despite logistical hurdles

    For executives and fans planning to partake in high-end hospitality at the 2014 FIFA World Cup, the easy part will be getting to the host country. Flights are plentiful from most major North American cities to Rio de Janeiro and São Paulo, and it’s a much shorter trip than the one in 2010 to South Africa.

    After that, well, you may need a lot of patience.

    The private suites being sold are illustrated in this rendering. All of those at the stadium in São Paulo and Rio de Janeiro have already sold out.
    Photo by: Match
    “To get around the 12 World Cup stadiums in Brazil, you have to fly to each of them,” said Keith Bruce, president of SportsMark, the exclusive sales agent in the U.S. for FIFA World Cup hospitality. “That wasn’t the case in South Africa or in Germany [in 2006].”

    As a result, among SportsMark’s offerings are all-inclusive packages where fans can base camp in one Brazilian city and fly to see their favorite national team on game day, returning to their hotels after the match that same day.
    Ground transportation and parking will be a challenge, too.

    “It doesn’t matter if you build beautiful new stadiums, as they have in Brazil,” Bruce said. “If the roadways, parking and logistics around those stadiums are not up to standards, you’re going to have gridlock and people missing matches if they don’t leave early enough. We saw that with the opening match in 2010 in Johannesburg. Some of the stadiums in Brazil have very little real estate around them and almost no parking.”

    Of course, the good news is, if you’re fortunate enough to have access to the hospitality options at the World Cup, leaving your hotel early for the match is not a hardship. Hospitality tents, featuring snacks and drinks, will open 2 1/2 hours before matches and stay open for two hours after matches. Bruce said SportsMark is working to “manage clients’ expectations about the hurdles” they will face.

    Logistical challenges are not hurting sales. While Bruce would not disclose specific figures, he said SportsMark’s sales at this stage for the 2014 World Cup are four times what they were at the same point for the South Africa World Cup. Bruce attributed the uptick to the shorter flights to Brazil and an improved economy.

    Match, the Zurich-based hospitality company that has the global rights to the World Cup, reports that all 200 private
    suites at the stadium in São Paulo — which is hosting one semifinal and five other matches — and Rio de Janeiro — the site of the final, one quarterfinal and four other matches — have been sold out since January.

    “Demand from the international market has been massive, better than any previous World Cup,” said Match Chief Operating Officer Pascal Portes. “Soccer is a religion in Brazil and the country’s economy is strong, so we’re also doing very well domestically.”

    Private suites in the various stadiums range in price from as low as $100,000 for a smaller unit in one stadium to watch four matches to more than $2 million to have a suite for every match in the tournament.

    Match also has the Bossa Nova Studio, a luxurious lounge overlooking midfield. Only one studio is available for each venue. Match also has three categories of hospitality products, labeled as business seat, pavilion and premier, the high-end equivalents of an airline industry’s first class, business class and coach, respectfully. Those five packages are the same as what SportsMark is pitching to U.S.-based companies.

    Portes is well aware of the concerns about hotel space and transportation, but pointed out that asking hospitality patrons for patience at mega-events such as the World Cup, Olympics and Super Bowl has become standard procedure.

    “These problems are not specific to Brazil and this World Cup,” he said. “We expect to have in excess of 250,000 hospitality customers alone in Brazil, and navigating the venues across the country is not a simple task. But our company and our partners are experienced and prepared, so I’m very confident that we are going to deliver.”


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  • Stadiums rush to beat the clock

    With less than a year to go until the 2014 FIFA World Cup kicks off at Arena de São Paulo in Brazil, only six of the 12 World Cup stadiums have been completed, while the remaining six struggle to meet FIFA’s December deadline.

    Construction has been plagued by delays, cost overruns and safety concerns. These issues led FIFA General Secretary Jérôme Valcke to declare that the country’s World Cup preparations needed “a kick up the backside,” for which he later apologized.

    Strikes by workers in several host cities have delayed work, as have incidents that have raised concerns over construction quality and safety.

    The stadium at São Paulo is among the World Cup venues that still have plenty of work remaining.
    Photo by: Getty Images
    The friendly between Brazil and England on June 2 at Rio de Janeiro’s renovated Maracanã stadium almost didn’t happen after a judge ruled to cancel the game because of safety concerns. The stadium had largely finished a three-year, $536 million renovation, but the judge was concerned that, among other things, rubble outside the stadium could be hazardous if supporters picked up the debris during a disturbance. Eventually, however, the injunction was lifted in time for the match.

    Concerns also were raised at Arena Fonte Nova in Salvador when in May a small part of the roof collapsed, apparently because of rainwater buildup. The stadium is set to host Confederations Cup matches this month.

    Crews are rushing to complete work at the remaining projects before FIFA’s December deadline. That’s the case at Maracanã, the largest of all 12 venues with a capacity of 76,804 for the World Cup.

    Maracanã is to Brazilian soccer fans what Yankee Stadium is to baseball fans in the United States. Originally built for the 1950 FIFA World Cup, the last time Brazil hosted the event, the stadium has undergone several renovations in its 63-year history. It was also the setting for Brazil’s arguably most painful defeat. On July 16, 1950, Uruguay defeated Brazil 2-1 in the World Cup final in front of 173,850 people.

    Maracanã is one of five stadiums that have been renovated and modernized for next year’s tournament, while the other seven are newly constructed.

    “[Brazil is] probably one of the most exciting, if not the most exciting market in the world when it comes to sport and entertainment today. The Brazil and entire South American marketplace is going through a renaissance with the venues that are there,” said Bob Newman, president of AEG Facilities, which has signed stadium operation deals with Maracanã as well as the World Cup venues in Recife and Curitiba.

    “The venues that are being redone for the World Cup are designed and renovated with the intent of having a life after the World Cup,” Newman said. “I think that’s what’s really going to separate what happens in Brazil in 2014 versus some previous World Cup locations. There will be long lifespans for these venues, and they will be used as a catalyst for continued development in their regions.”

    The Brazilian government will invest $16.6 billion in infrastructure for the 2014 World Cup, $2.9 billion alone for stadiums (see chart). After the World Cup, many of the stadiums will become home grounds for local soccer clubs, or host other sporting events and entertainment shows such as concerts.

    Newman believes that the new venues will invigorate the market.

    “Not only will existing events that have been touring the area go there, it will attract many new events because there are finally great venues to hold them in,” Newman said. “We certainly are in discussions with a few other locations right now. And I think between now and year-end, we’ll probably have a couple of good announcements.”

    HJ Mai writes for sister publication SportsBusiness Daily Global.



    World Cup venues in Brazil

    Of the 12 stadium projects, six have been “delivered” to FIFA, meaning the venues are generally in working order but may still have cosmetic work remaining. The rest are scheduled to be delivered by FIFA’s December deadline. The six completed projects are those in Belo Horizonte, Brasilia, Fortaleza, Recife, Rio de Janeiro and Salvador.

    Belo Horizonte
    Photo by: Getty Images

    Stadium name: Estádio Mineirão
    Capacity: 62,547
    World Cup use: Group stage, round of 16, semifinal
    Post-World Cup use: Home of Brasileiro clubs Atlético Mineiro and Cruzeiro; the venue will also host soccer matches during the 2016 Rio de Janeiro Olympic Games.
    Year constructed: 1965
    Design specs: One element of the renovation will allow the stadium to capture and store up to 1.7 million gallons of rainwater, which can then be resused.

    Brasilia
    Photo by: Getty Images

    Stadium name: Estádio Nacional de Brasilia
    Capacity: 70,064
    World Cup use: Group stage, round of 16, quarterfinal, 3rd place
    Post-World Cup use: Soccer, concerts, other sporting events, soccer matches during the 2016 Rio de Janeiro Olympic Games
    Year constructed: 2013
    Design specs: Second-largest stadium hosting matches for the World Cup

    Cuiabá
    Stadium name: Arena Pantanal
    Capacity: 42,968
    World Cup use: Group stage
    Post-World Cup use: To be determined
    Year constructed: 2013
    Design specs: Nicknamed “The Big Green” because of its features and building techniques that stress sustainability.

    Curitiba
    Stadium name: Arena da Baixada
    Capacity: 41,456
    World Cup use: Group stage
    Post-World Cup use: Home of Brasileiro club Atlético Paranaense
    Year constructed: 1914
    Design specs: Additional rows of seating parallel to the pitch will help boost the stadium’s capacity to 40,000.

    Fortaleza
    Stadium name: Estádio Castelão
    Capacity: 64,846
    World Cup use: Group stage, round of 16, quarterfinal
    Post-World Cup use: Concerts, soccer, other sporting events
    Year constructed: 1973
    Design specs: Improvements will include an underground parking lot with 1,900 spaces, executive boxes, a VIP area, and a new roof. Improved access will be provided by four exclusive bus lanes, a light rail line, and two metro rapid transit stations.

    Manaus
    Stadium name: Arena Amazônia
    Capacity: 42,374
    World Cup use: Group stage
    Post-World Cup use: Multifunctional space that can play host to events such as concerts, cultural performances, exhibitions and conferences
    Year constructed: 2013
    Design specs: Renovations reflect the city’s proximity to the Amazon rainforest. The stadium will be enclosed by a metal structure designed to resemble a straw basket, a product for which the region is famous.

    Natal
    Photo by: Getty Images

    Stadium name: Estádio das Dunas
    Capacity: 42,086
    World Cup use: Group stage
    Post-World Cup use: Concerts, soccer, other sporting events, local and regional carnivals
    Year constructed: 2013
    Design specs: The venue’s name and undulating structure relates to the sand dunes found in the Natal region.

    Porto Alegre
    Stadium name: Estádio Beira-Rio
    Capacity: 48,849
    World Cup use: Group stage, round of 16
    Post-World Cup use: Home of Brasileiro club Internacional
    Year constructed: 1969
    Design specs: The stadium was originally built over nearly a decade, with fans helping by donating bricks, cement and iron. For the renovation, a metal roof is being installed over the stands, ramps and turnstile areas.

    Recife
    Stadium name: Arena Pernambuco
    Capacity: 44,248
    World Cup use: Group stage, round of 16
    Post-World Cup use: Home of Brasileiro club Náutico
    Year constructed: 2013
    Design specs: The stadium will have a solar plant with a capacity to generate energy equivalent to the average consumption of 6,000 Brazilians. It will be part of a complex also featuring restaurants, shopping centers and cinemas.

    Rio de Janeiro
    Photo by: Getty Images

    Stadium name: Estádio do Maracanã
    Capacity: 76,804
    World Cup use: Group stage, round of 16, quarterfinal, final
    Post-World Cup use: Soccer, other sporting events, concerts, soccer matches during the 2016 Rio de Janeiro Olympic Games
    Year constructed: 1950
    Design specs: The stadium will play host to seven games in all, more than any other venue. The lower ring of seats has been demolished and a new ring added that provides improved visibility. The historic facade will remain untouched.

    Salvador
    Photo by: Getty Images

    Stadium name: Arena Fonte Nova
    Capacity: 48,747
    World Cup use: Group stage, round of 16, quarterfinal
    Post-World Cup use: Home of Brasileiro club Bahia; soccer matches during the 2016 Rio de Janeiro Olympic Games; concerts; other sporting events; conferences
    Year constructed: 2013
    Design specs: The original stadium on the site, built in 1951, was demolished to make way for this new venue. The stadium will house a panoramic restaurant, football museum, shops, hotels and a concert hall.

    São Paulo
    Stadium name: Arena de São Paulo
    Capacity: 65,807 (20,000 of which is temporary seating)
    World Cup use: Group stage, round of 16, quarterfinal, semifinal
    Post-World Cup use: Home of Brasileiro club Corinthians
    Year constructed: 2013
    Design specs: The stadium is intended to boost development in São Paulo’s most deprived areas and home to nearly 4 million people.

    Source: SportsBusiness Journal research, FIFA

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  • Gulati talks about FIFA post, state of soccer

    U.S. Soccer Federation President Sunil Gulati will not discuss much about the 2014 FIFA World Cup for one simple reason: The U.S. men’s national team has not qualified for it yet. Beginning with a match Tuesday against Honduras at Rio Tinto Stadium in Utah, the club has three matches left to earn a spot in Brazil. However, the 53-year-old Gulati, who was named to the 25-man FIFA Executive Committee in April, was able to speak about the state of U.S. soccer with reporter Christopher Botta.

    Could your new post with FIFA help in the push for a future World Cup in the U.S.?
    GULATI: It’s a seat at the table of FIFA’s board of directors, so it’s important for U.S. Soccer in general. As for

    future World Cup sites, that’s more difficult to say. Those are decided by all of the members of FIFA, so that’s 209 votes. But certainly you develop more relationships, so it can’t be anything but positive.

    How would you describe the health of the business of the U.S. Soccer Federation?
    GULATI: It’s very healthy. We are in the business of making investments in the game of soccer. The way we measure returns is not the way a commercial entity would, obviously. We’ve got a pretty good capital reserve and we’re investing some of those resources that we’ve built up over the last 5-10 years. The commercial revenues of any governing bodies are cyclical, in general. As you get closer to the men’s World Cups, the earlier years are slower. It picks up this year and next year as the national team hopefully qualifies.

    We’ve been in a long-term deal [with ESPN] that expires at the end of next year. A lot of our commercial deals with
    Said Gulati, “At some point, I’m sure there will be a day when we don’t qualify [for the World Cup]. I just hope that’s a hundred years from now.”
    Photo by: Getty Images
    Soccer United Marketing [the commercial arm of MLS] and with our TV partners, sponsors and Nike — our deal with Nike is independent of SUM — expire at the end of next year. It’s important to see how the future will play out.

    How did ticket sales for the 2010 World Cup in South Africa for Americans compare to the rest of the world?
    GULATI: Americans purchased more tickets for the last World Cup than anyone outside of South Africans. We’re continuing to see the growth of the game in the U.S. in so many ways. The announcement of Manchester City and the Yankees buying an MLS franchise is just the latest. So many important signs — whether it’s the number of kids playing soccer, the number of soccer matches being shown on American TV, or the TV ratings for the U.S. national team — are up. My guess is that U.S. ticket-buyers will be at the top of the list for the World Cup in Brazil.

    As the team faces a busy slate of crucial games between now and September, is it possible to articulate how important it is for the U.S. to qualify for the 2014 World Cup?
    GULATI: It’s extremely important. The sun will still shine the next day if we don’t qualify, but it would certainly cause a loss of momentum for us. At some point, I’m sure there will be a day when we don’t qualify. I just hope that’s a hundred years from now.

    What’s it like to be the U.S. Soccer Federation president in the stadium during all of these tense qualifying matches, with so much at stake?
    GULATI: It’s hard, especially during games that are close — and they are almost always close. You don’t want it to come down to the last qualifying game [Oct. 11 against Jamaica in Kansas City]. These next few months are as critical as it gets.


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