Bloomberg News

London Olympic Demand Hurting Euro 2012 Soccer Hospitality Sales

March 26, 2012

The organizers of the European Championships are struggling to sell corporate-hospitality packages for the three-week soccer tournament, as competition from the London Olympics and the event’s location in Poland and Ukraine crimps demand.

The quadrennial 16-team championship brings 1.3 billion euros ($1.7 billion) to soccer’s regional governing body UEFA, placing it behind just the World Cup and Olympics for revenue. It’s being played in eastern Europe for the first time, and starts about six weeks before the opening of the London Games.

Four years ago, the Olympics were in Beijing, “rather more difficult to access from Europe,” David Taylor, chief executive officer of UEFA’s commercial arm, said in an interview. “These things inevitably have an effect.”

The 2008 tournament in Switzerland and Austria had hospitality sales of 150 million euros, three times more than the 2004 event in Portugal, Taylor said. Current projections for June’s competition are for sales to be about 30 percent lower than in 2008.

Tony Barnard, marketing director at Prestige Ticketing Ltd., the London Games’ official onsite hospitality seller, said clients have told him they are prioritizing the Olympics, the first to be held in the U.K. capital since 1948.

“A lot of clients are saying this year we’re going to do the big one as opposed to some of the more perennial events that they normally do,” Barnard said in a telephone interview. “While the Euros are normally very well attended it is a very long hike out to Poland and Ukraine and it’s a different ball game to being France and Germany or Switzerland and Austria.”

Reallocated

UEFA said at its annual congress in Istanbul last week that general attendance tickets have yet to sell out and the numbers of those is likely to swell when unsold corporate seats and returns from national associations are reallocated. England, traditionally one of the best supported nations, has failed to sell out its allocation.

“The bigger football nations are worse than previous years,” Taylor said. “In some countries it may be because the national team isn’t performing so well, there’s a lack of enthusiasm for the national team, but I think in general there’s an issue of the distance to go and the costs involved.”

Rene Proske, managing director of Germany-based Proske Sports, responsible for organizing sponsor Coca-Cola Co.’s hospitality, said potential clients have been concerned about facilities in Ukraine.

“It’s infrastructure in general: buses, venues, hotels,” he said. “We have to be creative. Many clients have chosen to have fly-in fly-out programs.”

Anti-Corruption

The company is also an authorized seller of corporate packages. Sales are down about 30 percent from the last tournament, Proske said.

Another factor limiting sales are new anti-corruption measures brought in after the 2008 global financial crisis, according to Proske.

“It’s not that easy to invite people anymore, you need to justify that it’s not a bribe,” he said.

Taking the tournament to eastern Europe was part of a 2007 promise by UEFA President Michel Platini to develop the game in all parts of the region.

“A very important decision has been made to actually go to eastern Europe in the light of the awareness that this isn’t going to be the most financially successful tournament of all time,” Taylor said. “We could go elsewhere if that was our objective.”

To contact the reporter on this story: Tariq Panja in the London newsroom on tpanja@bloomberg.net.

To contact the editor responsible for this story: Christopher Elser at celser@bloomberg.net


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