How long will the drinks industry stand with FIFA?

How long will the drinks industry stand with FIFA?

FiFA corruption

In the last week FIFA has pretty much reached a point of no return in its identity and relationship with the football community. It’s on the precipice of self-destruction, riddled with systematic bribery and corrupt to the core, it surely is only a matter of time till the house of cards falls on the organization.

This, almost inevitable, situation puts major sponsors at an uneasy moral cross-roads with respect to its tacit endorsement of the organisation of the beautiful game. Specifically for the Drinks Industry’s Coca-Cola and Anheuser Busch InBev (who own Stella Artois, Budweiser and Corona) it puts them at a particular moral quandary, given that they the former is a ‘1st tier’ sponsor contributing £290M over a 4 year period, and the latter, which is a ‘2nd tier’ sponsor subsidises FIFA with an estimated £10-£25M over the same time period.

FIFA sponsor

Both brands have historically sponsored the World Cup and contributed massive sums to FIFA during that time.

Budweiser for instance, has been a World Cup sponsor since the 1986 event in Mexico, and is the Official Beer of the tournament, with its product on sale in all stadiums at the finals, and it also sponsors the Man of the Match award at each game.

Coca-Cola has been synonymous partner of FIFA and is one of the longest-standing corporate partners of the organisation, with a formal association since 1974 and an official sponsorship of World Cup that began in 1978. Coca-Cola has had stadium advertising at every FIFA World Cup™ since 1950.
Both sponsors released statements about the controversies this week:
Coca Cola said: “This lengthy controversy has tarnished the mission and ideals of the FIFA World Cup and we have repeatedly expressed our concerns about these serious allegations.

“We expect FIFA to continue to address these issues thoroughly.”

Budweiser stated that: “We expect all of our partners to maintain strong ethical standards and operate with transparency.

“We continue to closely monitor the situation through our ongoing communications with FIFA.”

Talk about sitting on the fence much.

Nonetheless will they call time on their respective relationships with the biggest sporting event on the planet? Would you?
FIFA corruption Blatter

Brand Finance, an intellectual property management company, argues that these big brands could lose up to $1bn (£653m) in value due to the reputational damage of being associated with FIFA.

If this is the case then surely these brands will follow others and not renew their contracts with the world governing body? If football’s ability to appeal to supporters’ hearts over their heads fails, then AB InBev and Coca-Cola will add their names to the long list of sponsors who have already seen their affiliation with FIFA as economically unsustainable:

For instance, FIFA partners Sony and Emirates, the airline, both declined to renew their contract as sponsors in November 2014. Sony’s contract was worth an estimated $280m (£183m) over eight years, and Emirates is believed to have paid £118.3m over eight years. Emirates decided not to renew its deal beyond 2014 because the terms on offer “did not meet expectations”.

Second-tier ‘sponsors’, Castrol, Johnson & Johnson and Continental Tyres, all abandoned the governing body in January 2015.

Sponsors must weigh up whether being connected to FIFA’s increasingly toxic brand is worth the profile that the relationship can provide.

FIFA corruption Blatter

A tee-total ban on drinks sponsorships?
Interestingly if the two major drinks brands do pull out their sponsorship, this could pave the way for a full-stop sponsorship of football in its entirety.
In an editorial in the journal Addiction, they say the burden of proof over whether such sponsorship causes people to drink more should shift from the public to the alcohol industry

Professor Ian Gilmore, president of the Royal College of Physicians and chairman of the Alcohol Health Alliance UK, backed calls for a ban on alcohol and sports sponsorship: “Notwithstanding the claims of their lobbyists, it is obvious that drinks industry sponsorship of sport is less about supporting an important part of our national culture and more brand positioning and profit

The drinks industry does not provide figures on sports sponsorship, but the Portman group, a public relations body representing companies such as InBev and Carlsberg, says alcohol firms spend an estimated £150m to £200m on sponsorship and advertising in the UK annually.

 

For example, Johnnie Walker whisky sponsors the Gleneagles and Classic golf tournaments along with the Team McLaren formula one car. Red Stripe is a big name in cricket and sponsored the 2005 Ashes. In rugby union, Scotland’s national team is linked to The Famous Grouse whisky and Wales has a relationship with Brains brewery.
Moral compass
Of course drinks sponsors haven’t always been the leading beacons of morally responsibility within our society.

Budweiser literally changed the laws in Brazil in order for its product to be sold within the stadiums.

In 2003, Brazil outlawed the sales of alcoholic beverages in soccer stadiums. For FIFA, the alcohol sales ban hindered one of the organization’s major sponsors: Budweiser.

FIFA corruption Mafia

FIFA demanded the Brazilian law be changed for the 2014 World Cup, and Brazil followed instructions.

“Alcoholic drinks are part of the FIFA World Cup, so we’re going to have them. Excuse me if I sound a bit arrogant but that’s something we won’t negotiate,” said FIFA Secretary General Jerome Valcke in January 2012. “The fact that we have the right to sell beer has to be a part of the law.”

A few months later, the Brazilian Congress voted for alcoholic beverage sales to resume in soccer stadiums. Brazilian President Dilma Rousseff signed the bill, nicknamed the “Budweiser Bill,” into law in June.

Final nail in the coffin
Personally, I would love to see both of the brands withdraw and with it planting the final nail in the coffin of this corrupt and morally vacant regime. However, for AB InBev and Coca-Cola if the multi-billion dollar conglomerate that is FIFA is set to continue in its current form, by still providing the world’s largest sporting showcase, they will undoubtedly continue to their sponsorship and world-wide market that FIFA provides.

Unless an unprecedented world-wide boycott occurs, meaning that the World-Cup by its very definition no longer exists, I cannot see the drinks industry willing to put their hearts over their wallets with respect to sponsoring FIFA.

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