Quick current events marketing quiz: Which of the following companies are official sponsors of this year’s FIFA World Cup?
A) 5 Hour Energy (“A Champion Achieves”)
B) Degree antiperspirant (Clint Dempsey ad)
C) Nike (Risk Everything animated soccer game)
D) Jaguar (Jozy Altidore stealing soccer balls)
If you didn’t realize the answer was E) None of the above, that makes FIFA – and its sponsors – very, very angry.
Not at you. They love you. If you’re watching, you’re helping to generate the estimated $4 billion in revenue that the current tournament is bringing in. They’re angry at companies who attempt to use the World Cup to promote their brand without forking over the millions of dollars required to become an official sponsor.
These sly marketers advertise and promote where the official sponsors are advertising and promoting, feature soccer prominently in their marketing but don’t use official logos of FIFA or the World Cup. In the process, they save themselves north of $100 million, the estimated cost of a FIFA Partnership. That’s the highest of three sponsorship tiers for the World Cup, and the six FIFA partners (Adidas, Coke, Sony, Hyundai/Kia, Emirates and Visa) enjoy deep relationships with FIFA that extend far beyond the 64 games of the current tournament.
The term for this circumventing approach is “ambush marketing,” and you could say it launched in 1996, when Nike, though not an official sponsor of the Summer Olympic Games, blitzed host city Atlanta will a variety of promotions that arguably drew more attention than the efforts of the official sponsors.
Few people have studied ambush marketing, and the measures that sponsoring organizations have taken to combat it, than Stephen McKelvey, an associate professor in the Department of Sport Management at the University of Massachusetts. Professor McKelvey, who also has a law degree, has written a number of studies on the legal and economic aspects of ambush marketing. His latest paper, co-written with U Mass colleague Neil Longley, focuses on the legislation that has popped up in host cities to combat ambush marketing.
For the past few Olympics and World Cups, every host nation has enacted some form of ambush marketing legislation that makes illegal many of the tactics used by non-sponsors. That’s not a coincidence, of course; FIFA and the International Olympic Committee have made such legislation a requirement for any successful bid to host their mega events.
But legislation is not the only reason.
“Companies have decided to stop wasting money trying to outshout each other,” McKelvey says. “Most companies have decided: You guys have the Olympics, you have the World Cup, and we have the Super Bowl. And we’ll sort of stay out of each other’s way.”
It’s not a conspiracy; it’s smart use of marketing dollars. Ambush marketing by definition doesn’t include a sponsorship payment, but it still requires massive spending to get your message through the torrent of advertising and promotion from the official sponsors. “If you’re going to ambush a competitor, the money that it costs to break through – it’s much better to focus on places where you are the official sponsor,” McKelvey says.
The professor was kind enough to talk with me recently about ambush marketing and the trickle-down impact it’s had on smaller events. We’ll hit the highlights of that conversation in the next post.
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