Companies & Industries

Will World Cup Sponsors Get Kicked, Too?


Will World Cup Sponsors Get Kicked, Too?

Illustration by Steph Davidson

Coca-Cola (KO) has spent millions showcasing the bright, colorful drawings of Brazilian artist Speto on cans of its drinks around the world, in hopes that trumpeting its sponsorship of the upcoming FIFA World Cup championship in Brazil will burnish its brand. But Brazilian street artist Paulo Ito recently reimagined the country’s World Cup hosting with a darker image: a skinny boy clutching a knife and fork like Oliver Twist, crying over a dinner plate containing nothing but a soccer ball.

That such harsh sentiment is bubbling up in arguably the world’s most soccer-obsessed nation could spell trouble for World Cup sponsors such as Coke, Hyundai Motor, Sony (SNE), and Anheuser-Busch InBev (BUD). The companies have invested hundreds of millions to link their brands to the world’s most-watched sporting event. They do so with slogans such as Budweiser’s “Celebrate As One” and Coke’s “One World, One Game.”

Growing street violence promises to interrupt the multinational marketing bonanza as the games start on June 12. Protesters are fed up with high poverty, a lack of health care, and poor public services in the shadow of $11 billion in event preparations. Rather than letting the World Cup serve its traditional business role as a warm-and-fuzzy backdrop to sell stuff, activists seem intent on using the games as a global platform of their own—to highlight Brazil’s inequality.

“Sponsors have got to be locking themselves in their sports marketing war rooms right now to figure out exactly how to respond,” says David Carter, a management professor who runs the Sports Business Institute at the USC Marshall School of Business in Los Angeles. “Not only do they need to be concerned with activating their sponsorship, but they’ve got to be really concerned with a rapid response to anything that might go sideways.”

Coca-Cola is moving ahead. “We’re not running our marketing based on assumptions that are not realities right now, so we start from a place of high optimism,” says Emmanuel Seuge, Coke’s vice president for global alliances and ventures, explaining the company’s World Cup marketing plan.

In late May, Coke halted an event displaying the World Cup trophy in the capital city of Brasília. The decision came after an activist at the venue fighting for land rights, wearing a headdress, shot a police officer in the leg with an arrow. The exhibit reopened the next day, says Coke spokeswoman Alison Brubaker.

A year earlier, during the pre-World Cup soccer contest called the FIFA Confederations Cup, Brazilian police fired tear gas, rubber bullets, and percussion grenades at protesters. Demonstrations, targeting stadiums in all six cities that hosted games, were the biggest in a generation, with some drawing 1 million people.

The protests became so intense that at one point black plastic sheets were used to hide from view a giant Coke bottle in front of Rio’s Maracaña Stadium. Sony increased the security detail for its corporate guests during the contest. The electronics giant’s television sales in Brazil were below expectations as unrest overshadowed the matches, Sony Brasil President Osamu Miura said in December. And in the city of Belo Horizonte, demonstrators set fire to a dealership selling cars produced by Kia Motors, part-owned by World Cup sponsor Hyundai.

Officials expect more violence during the World Cup but vow they’ll be more prepared to deal with the fallout. Sony plans to create barriers to protect against demonstrators if necessary, Miura said. Coke says it too has contingency plans, which it declines to reveal. The company will monitor social media closely so it can react appropriately, Brubaker says.

Joe Tripodi, Coke’s chief marketing officer, told the Associated Press in April that the company would soften its celebratory tone if the unrest persisted. “You always have to be smart to have all kinds of Plan Bs, Plan Cs, and Ds to prepare for any contingency,” Tripodi said. “And if certain things happen, you might have to change the tonality of your marketing or communications.”

Marketing executives will also closely watch the soccer championship for clues as to what they may face during the 2016 Summer Olympic Games, also in Brazil. “Rio [Olympics] sponsors will view the World Cup as a dress rehearsal of sorts, hoping to remedy any fallout from this summer,” Carter says.

Photograph by Miguel Schincariol/AFP/Getty Images

Coke has advertised at World Cup matches since the 1950s and has been an official sponsor since 1978. Corporate sponsorships are the No. 2 funding source for FIFA, after sales of broadcast rights. In return, the companies get exclusive rights to use the World Cup as a marketing platform. Sponsors last year paid $404 million to be associated with the event, according to FIFA.

This year’s tournament is especially important for Coke. With emerging-market growth slowing as consumers struggle to find work and build discretionary income, Coke’s sales volume in Brazil declined 2 percent last year. That’s alarming for a market that in 2010 generated 11 percent growth for Coke and inspired optimism from a host of global consumer products companies. Chairman and Chief Executive Officer Muhtar Kent is counting on the marketing glow from Coke’s World Cup partnership to help turn things around.

Coca-Cola, which will spend $4 billion on global marketing in 2014, is going all out to publicize its World Cup ties. The company sponsored a 92,000-mile tour through 90 countries for the championship’s trophy, anchoring its largest-ever World Cup marketing effort across 175 markets. More than 1 million people viewed the Cup, Seuge says. Such tours have become a staple of Coke’s longtime sponsorship of the World Cup and Summer Olympic Games. Coke will sponsor the Olympic torch relay leading up to the 2016 games in Brazil.

The solid-gold World Cup is featured in a series of documentary-style short films Coke is distributing on the Internet and television. FIFA allows only tournament champions and heads of state to touch the trophy, but it granted an exception for Brazil’s national visually disabled football team—a moment Coke turned into a documentary, reinforcing its inclusive “The World’s Cup” theme.

As it did four years ago, Coke enlisted an undiscovered musician to create an anthem to help define its campaign, The World Is Ours. Local versions of the tune by Brazilian-born artist David Correy have been recorded by 24 artists in various languages around the world. The song has hit the Top 10 on Apple’s (AAPL) iTunes music service in 40 countries, Seuge says. And more than 218,000 consumers sent in head shots via Facebook (FB), Twitter (TWTR), and other social media that will be assembled into a photomosaic flag. Coke’s 32,453-square-foot Happiness Flag will lie on the field before the opening match in São Paulo.

Coke and its bottlers worldwide have been hyping their World Cup ties for months in packaging, advertising, and in-store promotions. Cases of drinks are being stacked to spell out the word Brasil in many stores, and Coke has launched discounts and cross-promotions with makers of sports-friendly foods such as chips and pizza. It’s also sparked demand for its sodas by holding sweepstakes in several nations awarding a trip to the finals.

Still, with economic protests brewing locally, it’s not all marketing business as usual for Coke in Brazil. In preparation for the soccer tournament and the Olympics, it has expanded a local program called Coletivo, which it created in 2009 to teach job skills. Coke will employ about 1,000 Coletivo graduates across Brazil during the World Cup. Said Tripodi: “The worst thing is you can be complicit by silence.”

The bottom line: Coca-Cola will spend $4 billion this year on marketing. World Cup protests in Brazil could dampen its message.

With Tariq Panja
Stanford is a reporter for Bloomberg News in Atlanta.

Tim Cook's Reboot
LIMITED-TIME OFFER SUBSCRIBE NOW

Companies Mentioned

  • KO
    (Coca-Cola Co/The)
    • $42.05 USD
    • 0.26
    • 0.62%
  • SNE
    (Sony Corp)
    • $17.69 USD
    • -0.35
    • -1.98%
Market data is delayed at least 15 minutes.
 
blog comments powered by Disqus