Global brands stay away from the 2018 Russia World Cup

ANATOLY MALTSEV

Volunteers involved in the 2017 FIFA Confederations Cup and the 2018 FIFA soccer World Cup attend presentation of the volunteer training programme in Saint Petersburg , Russia, 11 April 2017. More than 30,000 volunteers will undergo training until March 2018.

Global brands stay away from the 2018 Russia World Cup


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Exactly a year from now, on April 22, the 2018 Russia World Cup will begin with a kick-off game in St. Petersburg. Advertisers should be warming up to the event, except “Russia” and “FIFA” are two values many brands would not want to associate with.

FIFA is struggling to find sponsors for the Russia 2018 World Cup, Vedomosti reported on Wednesday.

Thus far, there are ten contracts for what should be prime exposure value for the international advertising industry. Russia’s Alfa Bank, Sony, Emirates, and Hisense Electronics are some of the brands willing to brave the considerable risk of linking their reputation with an event in Russia, organized by FIFA. Not bad, since the Financial Times estimates that these sponsorships alone could fetch $100 million. But, in the Brazilian World Cup, FIFA secured 20 major sponsors. That is a long way to go in terms of numbers, if not value.

Both the location and the organizer are potentially toxic.

Preparations are slow. For instance, the construction of the Zenit Arena in St. Petersburg has cost Russian taxpayers €697mn and ten years down the line is still not ready. But, while corruption is mainly a Russian issue, there are political risks that could tarnish any sponsor’s reputation, ranging from the wars in Ukraine and Syria, not to mention the illegal annexation of the Crimean Peninsula.

Russia is half the problem. The proof is that even global Russian brands are not enthusiastically buying into the project. No Russian media conglomerate is willing to pay the $120 million price tag FIFA is putting on its product and for a good reason.

FIFA is a toxic brand.

The other half is that FIFA’s reputation. The Dutch Trade Union Confederation has taken FIFA to courts over slave labour practices in Qatar, an issue that is not altogether absent from Russia. FIFA itself is now associated with systemic corruption, that is, a value that not all brands welcome.

Both the 2018 games awarded to Russia and the 2022 games awarded to Qatar have tarnished FIFA’s reputation and make part of Joseph Blatter’s legacy. The two controversial decisions to award these two events were taken simultaneously and were followed by Blatter’s resignation.

The current FIFA leadership is linked to the very same regime that has ruled FIFA for decades, and it was only a matter of time before Gianni Infantino was embroiled in his very own corruption scandal through the famous Panama Papers. Sure, viewers will still need to buy a TV, drink a beer, and watch beer while watching the world’s most popular sport. But, many brands will take a back seat on this event, and the next one.

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