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Looking at the potential corruption associated with FIFA, the World Cup and its commercial engine

One day before the start of the FIFA World Cup, negative media turmoil surrounds football’s leading sports governing body (FIFA). Claims regarding corruption in association with Qatar’s 2022 FIFA World Cup bid highlight a potential scandal for FIFA right before the start of football’s biggest party. With the scale of the FIFA World Cup in mind, the global reach of the scandal is enormous and it also touches the huge commercial interests tied to the event.

Corporate giants like Adidas, Coca-Cola, Anheuser-Busch, Sony, Hyundai/Kia, Visa and others are among the sponsors for FIFA World Cup and with the strong consumer interests of the these brands and thus the powerful voice of consumers in postmodern sports marketing and sports event initiatives, there is no doubt that these sponsors are putting pressure on FIFA. This form of negative storytelling, which accompanies the warm-up phase for the World Cup, is not good news for FIFA nor for the sponsors or for the international football community in general. Football’s highest governing level has been associated with such rumors for years or for being too conservative in its operations to fully understand and accommodate the best interests of the game for what reason this scandal may be what is needed to fight the metaphor (and/or the reality) of ‘too many old men with grey hair running the world of football’? Many of the FIFA World Cup sponsors have been investing in the event for years and have also engaged in long-term contracts that include the upcoming FIFA World Cup tournaments. No corporate sponsor has an interest in wasting resources and whether or not we emphasize the economic investments or investments measured in time and knowledge, sponsors do not want to be associated with corruption and certainly have no interest in seeing their investments go down the drain. With the rise of the Internet and social media platforms and hence enhanced consumer power, the consequences of wrongdoings of corporate sponsors in such situations may harm their brands dramatically for what reason it is natural that they support investigations into this matter or simply a re-vote (in terms of the 2022 tournament). Before and during the FIFA World Cup, it is quite interesting to follow the commercial competitions among corporate brands, in which these brands enter a serious battlefield to promote the newest innovative consumer products in front of a global football audience.

Given this development, it may be even more interesting to be Nike. The American sports giant is very visible during the tournament without being an official sponsor like Adidas but Nike has for the first time surpassed the German brand in terms of the number of teams wearing its jersey in the tournament. And this time, Nike is not the brand that may get caught in the middle of consumer protests due to associations with corruption, which may happen to sponsors that do not act in alignment with consumer expectations when FIFA is being investigated. Coca-Cola and McDonalds are two sponsors, which learned a lesson when they did not fully acknowledge the consumer power tied to the Winter Olympics in Sochi. Both sponsors were thought to some degree neglect the concern about Russia’s anti-gay laws when they first launched their sponsorship campaigns. So, the interplay between FIFA, its corporate sponsors, global media and fan audiences presents an interesting and complex business case, which shows both sides of the coin when revealing the pros but also the cons of sports marketing investments. The mega event gives FIFA a solid capital injection of supposedly $4 billion in revenues, which is a strong improvement on the monetization associated with the latest tournament in South Africa. In that regard, FIFA has created a good trend of realizing a maximization of broadcasting and marketing revenues and that scenario display to advantages of football sponsorship, which caters to a very broad target audience across cultures, social groupings and gender and age differences. Though, FIFA’s handling of political interest portrays the other side of the coin. If you take a look at some of the current FIFA sponsors, e.g. Sony, Visa, Coca-cola, and Hyundai, you will see that they pay large amounts annually to be linked to FIFA and the international football community. These corporate giants have signed multi-year deals and have found it strategically sound to bet on football given its broad level of coverage across multiple segments, which is in fine alignment with the broad appeal of their products (Sports Sponsorship Insider, 2014).

It will be interesting to see if this causes a re-vote and what that entails and means for the 2022 FIFA World Cup?

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