Saturday, June 03, 2006

The Rivals

A cumulative 28 billion fans watched the FIFA World Cup Korea/Japan 2002 , and FIFA officials expect 32 billion cumulative viewers to tune in this year. Companies are expected to spend more than $1 billion on advertising not including sponsorship fees, and marketing and hospitality during the FIFA World Cup Germany 2006 . Being a World Cup sponsor can be lucrative and the popularity of the game in the US has prompted many leading companies to join adidas and sponsor the championship. Budweiser beer , MasterCard , Gillette , Yahoo! , McDonald's and Coca-Cola have all financial backers. adidas, expects to ring up $1.5 billion in soccer sales this year, up from a previous estimate of $1.27 billion. The German giant is leaving nothing to chance. adidas continues to be one of the event’s official sponsors and will supply the match ball in all 64 matches. Sales of the new TeamGeist , (soccer ball) are estimated to be over 15 million by the end of the year. Germany's Adidas-Salomon will shell out close to $200 million, while Oregon-based Nike who has no association with the FIFA World Cup will spend more than $100 million on various campaigns to promote their football apparel. This has caused much angst to their rivals as Nike’s high profile advertising in the past has successfully confused many consumers who remain convinced Nike is the major sponsor of the FIFA World Cup. After the '02 World Cup in South Korea and Japan, market research demonstrated more British consumers thought Nike was the official sponsor of the tournament. Part of Nike’s successful strategy has been to sign some of the world’s most celebrated soccer players, such as Brazilian star Ronaldhino to help spread the Nike message to soccer-obsessed young people around the globe. This year Nike included Manchester United’s Wayne Rooney to endorse their new boots but when he suffered an unconnected metatarsal stress fracture this created an unfortunate blip in Nike promotional plans. Nike have teamed up with Google to create the world's first social network for soccer fans, Joga.com . The website has about 800,000 members from across the world including Chile, Afghanistan, Malaysia, and New Zealand. Subscribers can see the Ronaldinho advert, chat about the games and anything else for that matter about the beautiful game. Nike’s marketing push has already paid off, according to the company, with sales of their soccer gear booming. adidas remains the global leader in soccer footwear with 38% of the market, according to NPD Sports Tracking Europe , Nike now controls 31% but their intent to supplant the German company in the only athletic sneaker category where it is No. 2 is real. A big commercial push during the FIFA World Cup comes at a time when global sales in Ath Leisure footwear in the under 35s is dropping. In both US and UK sales of trainers have faltered of late as more young adults prefer ro wear conservative shoes. This trend is the reverse of over 55 males who appear perfectly satisfied in tracksuits and trainers. Nike and Adidas have set their sights on the global pitch by targeting the higher-growth markets in Latin America and Asia. Asia-specific designs and a strong soccer presence have helped adidas overtake Nike in Japan. adidas have sponsorship the 2008 Beijing Olympics for $80 million; together with Reebok 's $70 million Yao Ming contract and a roster of retail outlets in China set to reach 2,400 by 2008. (adidas bought over rivals Reebok in a $3.8 billion deal earlier last year). China has an expanding middle class and an estimated 2.6 billion feet to fit, hence mainland is considered to be the real gem in the crown as far as marketing is concerned.

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