Hyundai and Kia Motors are “extremely concerned.” Visa said its disappointment is “profound.” Coca-Cola said the controversy “tarnished the mission and ideals” of FIFA. But as Sepp Blatter wins a fourth term as president of FIFA, sponsors are in a bind: pull out of an extremely valuable global event or risk having your own brand tarnished by a scandal that could drag on for years.
On Friday, May 29, Prince Ali bin al-Hussein of Jordan conceded the race to Blatter before a second round of voting, as FIFA nations delivered a rebuke to U.S. authorities, which indicted nine FIFA officials and five sports marketing executives earlier this week for bribes amounting to $150 million over 25 years. It leaves the sponsors in a difficult position: how to express their disappointment with FIFA while simultaneously pouring hundreds of millions of sponsorship dollars into the organization.
“Sponsors have spoken out to say they want change and now they have to hold FIFA accountable for that change,” said Jim Stengel, a marketing consultant and former chief marketing officer of Procter & Gamble.
The question is how? It’s one thing to take a principled stand in a press release and quite another to sabotage multiyear marketing and product plans, or worse -- open the door to a competitor. Sony and Emirates announced they wouldn’t renew their FIFA sponsorships in November 2014, but rivals Qatar Airways and Samsung are reportedly in talks to replace them.
Hundreds Of Millions
The World Cup stands out along with the Olympics as one of the two most powerful -- and expensive -- global marketing opportunities available. There really isn't another global media property that comes close. “It reaches hundreds of millions of fans. It costs a lot of money. It’s a big decision to enter and a big decision to get out, and it always seems like there’s a competitor in the wings,” said Rick Dudley, chairman and CEO of Octagon, a sports marketing agency and unit of ad giant Interpublic Group.
After the big two, there’s a steep drop to other global sporting events, such as Formula One, golf and tennis, and then other regional sports leagues that happen to have a global fan base, like the NBA and English Premier League soccer.
So FIFA’s six biggest sponsors -- the presenting “partners” that pour the most into FIFA’s marketing coffers ($1.6 billion over the past three years) -- have a difficult decision to make. They can live with Blatter or take the drastic move of pulling out of FIFA and risk being replaced by a competitor who reaps the benefits in three years, when the public could have largely forgotten the scandal.
That’s why you’re likely to see sponsors play a waiting game, at least for the time being. “Where we would be with our clients is wait, don’t do anything. Don’t run away, but we need to get more data and information,” Dudley said. “You have to make a strong statement and demand that things change.”
Aside from pulling out or holding their noses, marketers have a third option: sticking around and making their dissatisfaction known. That was what some sponsors of the Sochi Olympics at least attempted to do in the wake of several anti-gay decrees that the Russian government signed into law. “We believe the Olympic Games should be open to all, free of discrimination, and that applies to spectators, officials, media and athletes," McDonalds said.
But that didn't stop activists from hijacking McDonalds' #cheerstosochi hashtag or others who felt McDonalds and other Sochi sponsors should have done more.
Indeed, there’s the risk that if the World Cup gets more toxic, it will make the marketing look silly, or worse, create a public backlash. That happened to some extent during the Brazil World Cup, where FIFA itself became synonymous with rampant public expenditures and worker deaths.
Already, the 2022 World Cup, awarded under controversial circumstances to Qatar, has been tarnished by allegations of slave labor and hundreds of worker deaths during construction of stadiums for the event.
— The Independent (@Independent) May 28, 2015
All of this is weighing on the minds of some of the world's largest corporations, which once saw the global game as a safe haven for brands. “FIFA needs to reflect the values and ideals of its sponsors and those companies can guide them,” Stengel said.