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For sponsors, huge global exposure

Embedding advertising in content is an advertiser's dream. Televised soccer offers an unparalleled opportunity.
/ Source: Forbes

Embedding advertising in content is an advertiser's dream. Televised soccer offers an unparalleled opportunity. Two halves of 45 minutes of continuous play each game, extensive stadium signage and countless highlight replays let advertisers keep their names and logos in front of audiences for long periods.

Soccer's quadrennial World Cup gives sponsors the rare opportunity for global exposure on a huge scale. One billion people are expected to watch the title game of the 2006 tournament, July 9 in Berlin. The cumulative television audience for the final rounds, which are being played across Germany over the previous four weeks, is forecast to top 40 billion viewers in more than 200 countries.

Internationally known brands from Adidas to Yahoo! are paying handsomely to reach those eyeballs. Fifteen companies paid an average of $35 million to join the International Federation of Football Association's (FIFA) "partnership" program for sponsors of the 2006 tournament. Each company will spend at least as much again in support marketing and promotion.

All 15 sponsorships sold out a year ahead of the qualifying games that started two years ago. In addition, FIFA sold six Official Supplier sponsorships, which grant limited domestic marketing rights to companies in the host country, to Energie Baden-Württemberg, OBI, Hamburg-Mannheimer Versicherung, Postbank, ODDSET and Deutsche Bahn for $16.8 million each.

The first World Cup to have an organized corporate sponsorship program was the 1982 tournament held in Spain. It is a measure of world soccer's growth as a marketing vehicle that the $19 million raised from all nine first-tier sponsors then would have bought barely half a sponsorship at this year's finals. Adjusting for inflation, total sponsorship dollars have more than quadrupled.

By the time of the 1998 Finals in France, the sponsor roster had swelled to 43. FIFA has since cut back, selling each product category exclusively and eliminating a secondary tier of sponsors, leaving just the 15 partners, plus official suppliers, licensees like retailer KarstadtQuelle, and broadcasters.

With that has come an active campaign on FIFA's part against non-sponsors seeking to cash in on the event by association, known as ambush or parasite marketing, something Adidas' archrival Nike has turned into an art form with its advertisements crammed full of World Cup stars. FIFA has launched legal actions around the world to protect its trademarks and copyright. That catches some counterfeiters, but savvy ambush marketers are careful to avoid infringing FIFA trademarks.

TV audiences make little distinction between brands that are official sponsors and those that are not, market research suggests. One explanation: sponsorship of professional soccer operates on several levels — competitions, national teams, clubs and individuals.

Adidas is FIFA's sports equipment partner, but Nike sponsors the U.S. and Brazilian national teams, among others, which will wear its uniforms throughout the tournament. Yet players on those teams may have personal endorsement contracts that would result in them wearing, say, boots made by Adidas or even a third company. Little wonder consumers get confused.

Of the original nine sponsors from 1982, only Coca-Cola, Fuji Film and Gillette have been ever present. Sponsors come and go for a variety of reasons. Some, such as Vini d'Italia (Italy, 1990) and KoreaTelecom and NTT (Japan and South Korea, 2002), are there as home team sponsors.

Avaya, a communications company, is bowing out after two World Cups. It spent $105 million on sponsorship for this year's World Cup, the previous one in 2002 and the 2003 Women's World Cup. As a recent spinoff from Lucent Technologies in 2000, it wanted to establish awareness of its new identity, and to demonstrate its technical prowess, by building and running for each tournament what was billed as the largest temporary mobile communications network.

It saw soccer as a good avenue to reach information technology professionals and chief executives who might be potential customers, both in the U.S., where the sport is not a blue-collar enthusiasm but is followed by an affluent and educated crowd, and in emerging economies, which are among the fastest-growing mobile telephony markets. Having made that global impact to its satisfaction, the company says its marketing plans now call for country-specific sponsorships.

Avaya will not be the only top-tiered sponsor missing from the next World Cup. FIFA is shaking up its sponsorship arrangements once more, to shake down even more sponsorship dollars. For the 2010 and 2014 World Cups, there will be what it calls six Partners, six to eight World Cup Sponsors and four to six National Supporters.

The partners will be involved in a broad range of FIFA competitions and events. Adidas, South Korean carmaker Hyundai, technology and entertainment group Sony, Coca-Cola, Visa International and Emirates, the Dubai-based airline group, have already signed up. Announced values for the eight-year deals range from Adidas' $351 million to Emirates Airline's $195 million.

Visa's deal has already triggered a lawsuit against FIFA from MasterCard, a current partner, which claims it had right of first refusal in the electronic payments sponsorship category for the next World Cup.

Anheuser-Busch's Budweiser beer was the first brand to sign on the dotted line to be one of FIFA's new World Cup sponsors, which will be limited to just that tournament and the Confederations Cup, a small-scale competition held in the host country a year before a World Cup as a dry run.

FIFA is indulging in a little brand extension of its own. It is adding new World Cup-branded tournaments beyond its Women's World Cup and youth world championship. These include the U-20 Women's World Cup; the Interactive World Cup, a global gaming event, played on and off-line; the Beach Soccer World Cup, a long-standing event, now owned by FIFA; and the Club World Cup, an annual event to decide the world's best football club, which moves FIFA deeper into the brewing conflict between club and country soccer.

And somewhere between all the marketing and sponsorship, some soccer balls may still get kicked.