2010 FIFA World Cup and the SA industry

2010 Marketing do’s … and don’t’s

There are three tiers of sponsorship to the world cup: six FIFA partners, six FIFA World Cup sponsors and six national supporters.

Being a FIFA partner means having the highest level of affiliation to the soccer body. The 2010 FIFA partners are adidas (all uniforms worn by staff and umpires, as well as the offcial ball), Hyundai, Sony, Coca-Cola, Visa and Emirates Airline. The six positions were already filled in 2005 — the first time it had been done four years prior to the event.

The corporations are signed for a minimum of eight years and have global rights to all FIFA’s events as well as to the brand itself. This means they have the opportunity to be tied in with 2010, 2014 or both.

The second tier includes companies such as McDonald’s and MasterCard. McDonald’s recently extended its FIFA world cup sponsorship from 2007 to 2014, a period covering the next two world cups.

The last tier in the World Cup sponsorship ranks is to be a World Cup national supporter. This group will consist of six SA companies.

So far, First National Bank (FNB) and MTN have signed.FNBs $30-m (close to R216-m) sponsorship will enable them to provide full service banking, commercial, corporate transactional banking, foreign exchange transactions and on and off-site automatic teller machines at various locations for both the 2010 World Cup, and the Confederations Cup in 2009.

Local World Cup organising committee chief Danny Jordaan said the national sponsors would come from different areas of business. He would not say which other areas would have exclusive sponsors.

Jordaan says that for the period between 2007 and 2010, FIFA has already secured $3,1-bn, the largest amount in the football authority’s history — between 2003 and 2007, including the Germany World Cup, FIFA managed to secure $1.8-bn. The money comes mainly from corporate sponsors and broadcast rights, but Jordan said that broadcasting rights in Asia, Africa and South America for the 2010 tournament were still outstanding.

The $3,1-bn figure could increase, with more sponsors likely to come on board.

FIFA lists four main benefits to being linked to its major tournaments;

» Media and other exposure — through field boards and backdrops to television interviews seen by billions of viewers
» Event rights — through tickets and hospitality
» Marketing rights — through the use of official logos
» Trophy and business opportunities

The can’t’s of world cup advertising

SA is a world leader on ambush marketing law – so do not even think of attempting to try and circumvent it.

SA’s Minister of Trade and Industry, Mandisi Mpahlwa, announced in May that the 2010 FIFA World Cup event is protected by ambush marketing laws — making them valid from May 2006 until December 2010 (six months after the close of the world cup). This is to protect FIFA’s global rights to the event, as well as the sponsors’ rights.

Basically, if you are not a FIFA World Cup 2010 official sponsor, or have not had your carefully thought-out campaign or product to capitalise on the hype of 2010 approved by FIFA, you will not be allowed to sell, display, advertise, allude to, or distribute any material, service or product for gain which is associated with the World Cup.

What is ambush marketing?

Ambush marketing takes place when a trader seeks to utilise the publicity value of an event, for instance a major sports tournament or concert, to gain a benefit from it, despite not having an interest or connection with that event, and more particularly, not having made a financial contribution towards that event.

The rationale for protection is that major events require sponsorship to make them viable, and that investors require a return on investment from the event. If they don’t, they are less likely to sponsor events in the future. Without sponsors there are no events. Also there is the problem of ethics — taking advantage and benefiting without investment.

"Ambush marketing, such as airships that just happen to be flying over a stadium on the day of a Soccer World Cup tournament, free buses (heavily branded, of course) provided to gullible municipalities for their fans, streakers with brand logos painted on their bodies, fake demonstrations with branded posters … you name it, it’s been tried … and it’s all illegal in the 10km FIFA zone around each of the official world cup venues", writes Louise Marsland for BizCommunity.com (Tata my World Cup... tata the Scorpions. 15 August 2006. www.bizcommunity.com/Article/196/11/11255.html).

An Absa billboard used as an example of the "grey area" of the law was deemed to "probably not" be in transgression. It depicts a group of kids in soccer uniforms with a half constructed stadium in the background and the words: Now come and play here, a less direct allusion to the 2010 world cup. But this is just an example why copyright lawyers will have a field day in the run up to the World Cup.

The consequences of flouting the law are grave. Ambush marketing is deemed to be a criminal offence and could lead to fines and/or imprisonment imposed on a company and/or director of R5 000 or three years imprisonment per infringing item.

First offenders probably won’t go to jail, but fines will apply, according to Spoor & Fisher, SAs FIFA attorneys. If you inadvertently transgress the law in this regard, you will probably first get a warning letter to order you to stop.

What about current sponsors?

Recently ABSA asked to be compensated for the money it will lose due to FNB being FIFA’s official banking partner.

ABSA stands to lose its naming rights if the stadiums they sponsor are used in the World Cup, as well as access to hospitality privileges, for examples suites.

ABSA claims the loss could infringe the constitutional protection of property rights.

All existing advertising and names will have to be cleared off venues for World Cup matches, and the venues will only be allowed to carry advertising from FIFA and its partners.

Other companies, such as Vodacom and Securicor, will suffer similar fates at the venues that they presently sponsor.

Trade and Industry department head of commercial law and policy, Macdonald Netshitenzhe, agreed that there were constitutional implications for these companies in the loss of rights, and suggested that it should negotiate a solution. He said he did not think the issue of compensation should be addressed in the law.