Soccer's World Cup ranks as the most popular sports event in the world, making it a prime showcase for global brands. In the United States, however, the product that stands to benefit most from the exposure is soccer itself.
Under an unusual deal, ABC and ESPN, both units of Walt Disney Co., will broadcast the matches live, but don't sell the advertising. Instead, Soccer United Marketing, the promotional arm of Major League Soccer, the U.S. professional league, handles the selling chores. In short, the league not the network is selling the sponsorships for the 64-game tournament, which starts June 9.
In 2002, SUM paid $40 million to FIFA, the sport's global governing body, for the U.S. English-language TV rights to the 2002 World Cup, the 2003 Women's World Cup, and the 2006 World Cup. SUM and ABC/ESPN will divide the revenues. The arrangement was designed to help build the sport in the U.S., and it has achieved one success: ABC/ESPN has already bought rights to the 2010 and 2014 World Cups for $100 million.
"These new television partnerships will provide Major League Soccer and the U.S. Soccer Federation with the most important broadcast agreement in the sport's history in America," announced Don Garber, a former NFL marketing executive and current commissioner of MLS.
Selling soccer to U.S. sports fans has for decades seemed a monumental challenge. The sport's popularity, despite the burgeoning growth of youth soccer and high school programs over the past 20 years, has yet to achieve the critical mass necessary to garner a major regular-season TV rights deal and a prominent spot on the American sports landscape.
While it has achieved pockets of relative popularity, fueled largely by ethnic populations, MLS is still struggling. Despite major investments from sports conglomerates such as the Anschutz Entertainment Group (owner of four teams, including the L.A. Galaxy) and Hunt Sports Group (three teams), the league has yet to attain profitability in its 13 years of existence.
A successful and popular World Cup, the sport's American backers believe, could provide a spark that would spike its growth in America or at least speed its pace.
So far, SUM has commitments for nearly 80 percent of the commercial slots, and the company plans to close another 10 percent before the opening kickoff, according to Kathy Carter, executive vice president of sales for SUM.
She expects to sell out before the tournament ends, and she has some big numbers to help close those sales.
The 2002 World Cup yielded a cumulative worldwide audience of nearly 29 billion people for 64 games. More than 1 billion sets of eyeballs watched the championship match alone. The average match delivered 314 million viewers for advertisers.
The 2002 Cup performed well for SUM, but it suffered from terrible broadcast times. Because the tournament took place in Japan and Korea, most of the games aired between 11 p.m. and 5 a.m in the U.S. In contrast, the 2006 event is hosted by Germany. The games will start at 6 a.m., 9 a.m. or noon in Los Angeles not quite prime time, but better than the graveyard shift. The audience numbers are expected to swell this year compared to 2002.
Carter expects matches for this year's Cup would be ESPN's best-rated broadcasts for the third quarter. "At the very least, we expect this event will perform extremely well," said Carter, "but you never know what could happen." Every World Cup produces a few surprises, and if the U.S. or Mexican teams perform well the two squads with the biggest following in the U.S. then the numbers could skyrocket.
Carter points to the 2003 Women's World Cup, won by the U.S. team. Advertising buyers expected it to deliver a 2 share, but it spiked up to 11.
Local advertisers can participate through the small inventory of local spots for the cup not sold by SUM, which handles the national accounts. "They should make inquiries to their local station or cable company," said Carter, "but by and large, the time is sold nationally and by us."
A soccer match consists of two 45-minutes halves, played without breaks. As a result, Carter said a typical broadcast lasts 2.5 hours, but has time for only 32 commercials at 30-seconds each. Those spots air during pre-game, halftime and post-game shows not during the action.
"There aren't many sponsors, so when you're running spots it's very effective because your message isn't lost in the clutter. Of course, there's a premium to pay for that. That's one of the benefits of being a World Cup advertiser or sponsor," said Cesar Sroka, media supervisor at La Agencia de Orci y Asociados, a Hispanic-focused ad agency in Los Angeles with experience in soccer marketing.
Thanks in part to the growth in youth soccer leagues, the audience for soccer skews younger and less male than other sports. "It's clearly in the 18-24 age category, but also in the 12-17," Carter said. She described the audience as multicultural and concentrated in the 20 largest urban centers of the country.
In addition to ethnic segments and avid soccer fans, the World Cup lures generic sports fans that tune in for the once-every-four-years event, Carter added.
Sroka said advertisers should take into account the viewing experience as well as the audience. "It skews male, but the act of viewing the games is more of a family event," he said. Ethnic heritage and pride in teams all play into the buy. "I would put it at the same level as the Olympics," he said.
Data from FIFA indicates another type of group viewing experience. "The 2002 FIFA World Cup saw exceptionally high levels of out-of-home viewing in public places, such as pubs and bars, and in the workplace. This added 2.5 billion to viewing worldwide," according to a statement from the worldwide soccer organization.
In planning World Cup marketing campaigns, advertisers should take into account the 15 major brands that sponsor the event. They include Coca-Cola, Budweiser, Adidas, T-Mobile, McDonald's, Hyundai and MasterCard. "Field boards" in every stadium feature only the 15 sponsors. Since FIFA rules don't allow any other commercial names associated with the event, some of the stadiums in Germany will change their names during the tournament.
The FIFA rules don't extend to individual countries, but most national networks give the worldwide brands the right of first refusal for purchasing ad time. Carter confirmed that several of the FIFA sponsors, including Budweiser, Adidas, and Hyundai, have bought exposure on ABC and ESPN.
In fact, the big brands usually budget to buy extensive airtime in the large territories. "It doesn't make sense to buy a worldwide sponsorship and then not take advantage of it in the local markets around the world," Sroka said.
Brands not connected to one of the 15 world sponsors still have options. Cater cited the example of Gatorade, a non-world sponsor that has bought ads for the U.S. market.
Sroka faces a different problem: One of La Agencia's main clients is Honda, but rival Hyundai has the worldwide sponsorship. "We don't have in-game advertising, but there are commentary shows and recaps of the game," he said.
Also, he suggested companies consider online advertising. As a worldwide sponsor of the tournament, Yahoo Inc. has an exclusive content agreement that will make it the only Web site allowed to stream video of game highlights. Magazines and newspapers will feature specials on the cup and specific teams.
For would-be global marketers still in the start-up phase, ABC and ESPN have announced that they will broadcast all 64 games for the 2010 World Cup in South Africa and 2014 World Cup in Latin America, probably in Brazil.
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