Marketing Week (MW): It’s two years until the next World Cup. What are Fifa’s main priorities for its licensing programme?
Ralph Straus (RS): First of all, the World Cup is the biggest single sporting event in the world. In 2010 we had 3.2bn viewers, which amounts to 46 per cent of the world’s population. That’s very important from a licensing point of view.
The main priority for us in terms of licensing is brand building. We see the entire licensing programme as an excellent vehicle to promote the World Cup and facilitate fan excitement. Revenue is an important aspect as well, both for Fifa, the licensees and the retailers that are working on this programme. But the revenue to us is less important than brand building activity.
MW: You are speaking at Brand Licensing Europe next week. Is Fifa doing anything particularly different in its licensing for the 2014 World Cup?
RS: Firstly, there are some generic trends that we have seen over the last couple of World Cups. One is that the entire licensing programme is becoming more global. In the past the focus has been on the host country and maybe some of the participating countries that have qualified. But now there’s a shift towards a more global approach.
For 2014, there will be a basic product offering on an international level and we’ll work on the retail concept with our retailer partners. From a product point of view, it won’t just be about putting an emblem on a t-shirt or a cap. There will be storytelling around the Fifa World Cup and around what’s happening in Brazil through the merchandising programme and the retail experience. We have key retailers in specific countries and one master licensee in Brazil.
MW: How is Fifa developing that storytelling idea?
RS: In recent World Cups and also with the Olympics there has been a signature product. It was the vuvuzela at the World Cup in 2010 and red mittens at the Winter Olympics in Vancouver so we will look to do the same thing and have a signature product for 2014. You can do storytelling around that and other brand assets like the mascot, and the trophy. We also create design variations that target specific groups like the youth market, older target groups or male and female and so on.
For Brazil 2014 the official slogan is ‘All in one rhythm’, which is based on a number of guiding principles that have been set by the local organising committee and the government on how they want to utilise the World Cup to position themselves towards a global audience and change some of the perceptions there are in the world around Brazil. So we can also use the merchandising programme to support that storytelling and brand building too.
MW: What are the timings behind this in terms of releasing products, mascots and the signature product?
RS: The mascot for 2014 was launched last month and the signature product may launch next year. The important thing with a sporting event is that you don’t want to be in the market too early. You need to see the excitement and attention building before you start with the merchandising. So we will have retail offerings in the market around December 2013 when the final draw for the tournament takes place.
Why is Fifa making a particular effort to use its historical brand assets from previous World Cups for 2014 and for brand building in general?
RS: We did some initial concepts around this for the 2010 World Cup but this is really the first time we’re going to test some of the concepts in the market [such as posters and historical logos]. We’ve secured the intellectual property rights for pretty much all the Fifa brand marques from past events, though there are still some discussions going on to secure some marques. In terms of promoting the World Cup legacy, they are very valuable.
We’re conscious not to go into the market and offer the marques to just anybody to start making products with them. It needs to be part of an overall concept and it needs to be carefully tested so we can see where it brings most value both to consumers and to Fifa in helping to build a legacy and brand awareness for the World Cup.
It’s about celebrating the World Cup history and legacy after so many different World Cups have taken place. There are also a number of ‘off’ years, or non World Cup years, when there is not so much attention around the event. It’s those kinds of years where we believe that using the historical marques can help us keep a level of attention on the World Cup at the retail base.
MW: Do your efforts go towards marketing Fifa as a brand or the events and work associated with Fifa like the World Cup?
RS: It’s a bit of both. In terms of Fifa itself we do a lot of brand communication around what Fifa stands for, the different activities we are engaged in, social development through football and so on. We also do a lot of research into the brand assets we have. For example if you look at Zakumi, the mascot for 2010, it still has 46 per cent awareness in seven of our key markets while Goleo from 2006 has 37 per cent – so it’s very high. In the host country it’s always higher: in Germany Goleo still has brand awareness of 79 per cent.
MW: There was negative publicity in the UK last year around the bids for the 2018 and 2022 World Cups. Is that a concern for Fifa in terms of its image?
RS: It’s certainly important to Fifa. We do a lot of research around the world in key markets on brand reputation. The perception of what Fifa’s responsibilities actually are differ from country to country. For example we are known first and foremost in different countries as the organiser of the World Cup, as the governing body of world football or for our social development work through football. That perception differs from country to country.
The reputational issues are very important to Fifa and are very high on the agenda of the Fifa president. But from a licensing point of view, we’ve noticed that there is not really an impact. We did a programme around the Fifa brand and the best selling article was a t-shirt that just said the word Fifa on it. For us that was an indication that it is still an attractive brand.
MW: Which new markets are you looking at?
RS: India is an emerging market in terms of football and so is China. Certainly Qatar is a different type of host nation from somewhere like South Africa or Brazil so it will have an impact on how we’re going to set up the licensing programme for that World Cup in 2022. Also, in terms of the target market, there will be a different product mix that will be need to be available in Qatar than in Brazil for example.
MW: What role do you see for social media and mobile?
RS: A good example is that when we launched the mascot last month, we also launched a naming competition in Brazil where we have put three names to the Brazilian population for them to vote on what will become the official name for the mascot. That is heavily supported by social media and our sponsors – for example Coca-Cola – are running promotions around that.
We also use social media to gain new insights into what people are talking about. So after the launch of the mascot we monitored social media to give us a good idea of the public feeling towards it. It’s very important from a licensing point of view because online purchasing is developing and will become more and more important in the future. The internet more generally is very important: Fifa.com had 6.5bn page views in 2010 so it’s clearly a great channel to engage with the fans.
Fifa in context
Fifa’s reputation took a battering last year after a series of scandals around the bidding processes for the 2018 and 2022 World Cups and the leadership race for the Fifa presidency. The latter saw Sepp Blatter remain in place by virtue of being the only candidate left standing.
The organisation has put together a ‘road map’ based on proposals made by Blatter, on good governance, transparency and zero tolerance towards wrongdoing on and off the pitch. It states that the plan is on track, working towards June 2013, when the ‘good governance’ process will be complete.
Yet Fifa is somewhat immune to bad press: people continue to love the sport. It’s not surprising then that Fifa is already planning another massive marketing exercise for the 2014 World Cup in Brazil, with a mascot recently launched and a major merchandising programme under way.
Fifa knows that its reputation matters too, particularly as consumer power becomes an increasingly important factor at events like the World Cup. The organisation’s decision to harness its historical brand assets like old World Cup posters and logos also suggests that it is seeking to create more awareness around the Fifa legacy.
Twitter @muz_n asks:
Are you concerned about the negative message that Fifa sends out when it allocates so many seats at the World Cup to sponsors rather than the general public?
Ralph Straus: It’s very important for Fifa or any similar organisation to have sponsors on-board. Without sponsors providing funding, such events would simply not be possible to organise. The second point is that when you have an agreement with a sponsor they buy certain rights which we need to respect. In terms of the tickets that sponsors get, many of those go back to the general public. A lot of the tickets are given away in competitions and other activations so in the end they go back to the general public.
Stats: returns from the 2010 World Cup
Total revenue (excluding ticket sales) of $3.7bn (£2.3bn), up 20% from 2006 (£1.9bn)
This included: income from TV rights of $2.4bn (£1.5bn), marketing rights of $1.1bn (£668m), hospitality rights of $120m (£74m), licensing rights of $55m (£34m)
Fifa’s 2014 partners
Adidas – Coca-Cola – Hyundai – Kia Motors
Emirates – Sony – Visa
Source: FIFA annual report and FIFA.com