Fifa’s World Cup marketers are sure to find some sections of the World Football Report 2018 recently published by Nielsen Sports an uncomfortable read. A comparison with the Fifa World Cup 2014 in Brazil reveals a significant downturn in sponsorship revenues for the Fifa World Cup 2018.
Tarnished reputation triggers sponsorship crisis
Figures released by Nielsen indicate that revenues from Brazil 2014 were US$1.629 billion while the total for Russia 2018 is only US$1.450 billion – a fall of $179 billion. Fifa is much more accustomed to strong growth in World Cup sponsorship, with 2014 revenues more than triple those recorded for the 2002 Japan/Korea event. However, given the extent of the fallout from the recent Fifa corruption scandal which has dogged the 2015-18 sponsorship cycle, this anticipated dip in performance bears all the hallmarks of chickens coming home to roost.
Nevertheless, the Nielsen data also documents a substantial expansion of Asian sponsorship, which represents 39% of all Russia 2018 deals. So, while long-term sponsors like Continental, Castrol and Johnson & Johnson have walked away from Fifa following the international investigations and arrest of many of its top officials, Chinese sponsors in particular have seized a golden opportunity to gain unprecedented global exposure for their brands. This timely intervention has gone some way to help Fifa weather the financial effects of the storm it has experienced, and also brought Chinese firms such as Vivo, Hisense, Mengniu, Yadea and Dalian Wanda (now one of Fifa’s privileged ‘partner’ sponsors) to the attention of Western consumers.
Toxic corporate behaviour under scrutiny
Fifa had been under investigation for some time before the scandal made global headlines, with America’s FBI querying the bidding procedures for World Cups awarded to Russia (2018) and the super-rich Gulf state of Qatar (2022). The US agency was also probing allegations of high-level Fifa corruption stretching back two decades, whilst Swiss authorities were conducting their own inquiries into the alleged criminal misconduct of certain Fifa officials.
From a sports fan’s perspective, the two most high-profile casualties of the Fifa corruption crisis have been long-standing Fifa President Sepp Blatter and Uefa President Michel Platini. Arguably the most powerful figures in international football, these men received lengthy bans from the game, effectively ending their careers as soccer administrators. However, Fifa’s General Secretary Jerome Valke and many other major figures in football around the world were also brought to book for the money they illegally siphoned from the beautiful game. In many instances, the perpetrators of racketeering, wire fraud, and money laundering conspiracies were forced to hand back millions of dollars gained from their illicit activities. And without breaking any laws, you could also win a substantial amount if you were to get lucky playing our casino games.
A different ball game?
Fifa’s real worry is that there is no guarantee the future will look any brighter. Commenting on the sponsor changes, sports marketing consultant Patrick Nally, who has worked with Fifa in the past, said:
“The big deals are still there, but it’s in decline … The big corporate names are moving away and being replaced by political players.”
Assessing the significance of Chinese sponsorship, Salford University professor of sports enterprise Simon Chadwick observed: “The Chinese view of ethics and governance is different to western standards, and it is very easy for Chinese companies to say ‘Fifa has moved on’. And, that they were not backing the Sepp Blatter-era regime and are supporting a clean Fifa under Gianni Infantino [elected as Blatter’s replacement in 2016].”
Though China are currently football minnows, Chadwick believes President Xi Jinping dreams of making China a “world football superpower” by 2050 and added: “China wants to host the World Cup, China wants to win the World Cup, and I speculate they also want a Chinese president of Fifa. Rescuing Fifa financially with these sponsorship deals will help the chances of achieving those dreams immeasurably.”