For US Companies, World Cup Could Mean Marketing Coup
COMPANIES from Boston to Silicon Valley hope to score big in the World Cup soccer matches.
Two years of qualifying matches will come to an end this month, leaving 22 teams to join Germany, the defending champion, and the United States, the host nation, in the world's largest single-sport event next summer.
US companies are making deals with World Cup USA 1994, which is managing the business side of the event in the US, to reach the huge audience expected to tune in to the games.
``Obviously, the World Cup has got a great deal of visibility,'' says Matt Miller, a spokesman for Gillette, an official sponsor since 1970. ``It cuts across barriers of language and culture across the world,'' building and enhancing brand recognition.
To become official sponsors of the World Cup, 10 other big-name corporations such as Coca-Cola, General Motors, MasterCard, and McDonald's have paid as much as $20 million each to the Fration Internationale de Football Association, the world governing body of soccer. John Griffin, senior press officer for World Cup USA, says he expects the host organization to turn a $20 million to $25 million profit from the overall venture, including business sponsorships and tickets.
Eight other companies, including American Airlines, Sprint, ITT Sheraton, Sun Microsystems, and the Upper Deck Company, a sports trading card company, paid about $8 million each to World Cup USA for marketing partnerships.
In return, the companies gain marketing rights and advertising options that will expose them to a television audience estimated at close to 2 billion people for the championship game alone. That is nearly triple the number that watched the 1993 National Football League Super Bowl, according to World Cup USA. In total, about 31 billion people will view the 52-game tournament, which is held every four years.
During the 1990 World Cup in Italy, stadium attendance totaled more than 2.5 million people, averaging about 48,000 a game. For 1994, nearly 4 million tickets will be distributed worldwide.
Such a far-reaching opportunity comes along just once in a lifetime, says Hoyt Harper, vice president and director of cooperative marketing for ITT Sheraton, the official hotel for the 1994 World Cup. ``This gives us a unique opportunity to showcase our best properties,'' he says. ``There are tremendous promotional aspects of the sponsorship in the US and worldwide.''
This is the first time in its more than 60-year history that the tournament will be held in the US. It takes place June 17-July 17 in (or near) nine cities: Boston, Orlando, Fla., Chicago, Detroit, New York, San Francisco, Washington, Dallas, and Los Angeles. The event could generate more than $4 billion in spending in the US, according to a 1992 survey by Peter Rosendorff and Andy Neumeyer, professors of economics at the University of Southern California.
McDonald's has chosen the World Cup for its first global sponsorship and is planning in-store promotions to support a variety of soccer programs, says spokeswoman Rebecca Caruso. ``The popularity of soccer certainly contributed to the sponsorship,'' Ms. Caruso adds. Soccer is the most popular sport in the world and second most popular US sport after basketball among young people, according to World Cup USA.
The Upper Deck Company plans to introduce a series of soccer cards for each of the 24 qualifying teams, says Christopher Corman, associate brand manager.
Nearly 200 companies worldwide have signed licensing agreements to sell retail items with the 1994 World Cup logo or mascot, says Ralph Irizarry, vice president of Time Warner Sports Merchandising. The novelty items include T-shirts, games, footwear, and hats.
``There's really a lot of nice stuff out there. It just really hasn't hit the stores yet,'' says World Cup press officer Mr. Griffin. Retail stores should be stocked with World Cup merchandise by the holidays, he says. Volume should ``snowball'' as the games approach, Mr. Irizarry adds.
The public does not yet realize that ``this is even bigger than the Olympics,'' Griffin says.