Scandal-hit Fifa lose three more major sponsors
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Version 0 of 1. Three of Fifa’s sponsors during the 2014 World Cup in Brazil have joined Sony and Emirates in declining to renew their contracts with the scandal-hit world governing body. Castrol, Continental Tyres and Johnson & Johnson – so-called second-tier sponsors that had a high-profile presence in Brazil – have confirmed they have not renewed their deals. Though none linked their decisions to the latest scandals to wash over Fifa following its much-criticised investigation into the controversial bidding race for the 2018 and 2022 World Cups, it will increase the pressure on the organisation led by Sepp Blatter. All three confirmed to the Daily Telegraph they had decided not to renew their contracts for a variety of reasons. Sponsors bring in at least $1.5bn in revenue over each four-year cycle. Continental Tyres had been a World Cup sponsor since 2010, Castrol since 2008 and Johnson & Johnson signed a deal for a single cycle in 2011. Its decision not to renew will increase fears in Zurich that Fifa’s image is becoming unsuitable for global brands and will force its commercial department to look more to regional sponsors to fill the roster. Increasingly, Fifa is likely to look to companies in Russia and the Middle East – the regions that will play host to the next two World Cups – to fill the gap. There are also plans to introduce more regional sponsorship tiers in an attempt to target developing markets. Those campaigning for reform at Fifa have long argued it is only through pressure from sponsors and broadcasters, who pour money into its coffers, that enough pressure will build to force fundamental change. Visa, Adidas and Sony delivered coded warnings over the bribery and corruption allegations that engulfed Fifa on the eve of the Brazil World Cup, calling on the governing body to ensure the claims were properly investigated. It emerged late last year that Sony and Emirates, two of Fifa’s six top-tier partners, would end their relationships with the governing body, which is hopeful of replacing them with Samsung and Qatar Air respectively. Adidas, which has a longstanding close relationship with Fifa and Blatter, recently renewed its sponsorship deal until 2030 while Visa’s contract runs until 2022. Coca-Cola, which became Fifa’s first sponsor in 1978, also has a long-term deal. Fifa’s top-tier sponsors pay between $24m and $44m a year, while second-tier World Cup sponsors – who also included Budweiser, MTN and McDonalds – pay an estimated $10m to $25m a year. Last year Michael Hershman, a former member of Fifa’s independent governance committee and co-founder of Transparency International, criticised sponsors for not stepping up to the plate. “They have simply paid lip service,” he said. “Saying in press releases: ‘Oh yes, the sport needs a greater degree of integrity and transparency.’ But they haven’t put their money where their mouth is.” Increasingly, brands have sought to focus on their relationship with the glamour of the World Cup and “fan engagement” campaigns rather than with the tainted Fifa brand. However, confirmation of the latest wave of non-renewals could lead other sponsors to consider their positions. Fifa’s marketing director, Thierry Weil, told the Guardian on Friday: “Rotations at the end of a sponsorship cycle are commonplace in the sports industry and have continuously occurred since the commercialisation of the World Cup began. It is natural that as brands’ strategies evolve they reassess their sponsorship properties. The contracts with Castrol, Continental and Johnson&Johnson were always planned to run until the end of 2014 and therefore expired on 31 December 2014 accordingly. “As in previous Fifa World Cup cycles, we are now in advanced negotiations with a number of companies related to sponsorship agreements in all three of our categories, ranging from Tier 1 Fifa Partners, Tier 2 Fifa World Cup Sponsors and Tier 3 Regional Supporters. Each category provides tailored marketing opportunities for companies with a range of varying rights and we expect interest to grow even more as the Confederations Cup 2017 and 2018 World Cup draw closer.” |