Soccer Business Bits: The Art of World Cup Sponsorship, MLS All-Star Revenue & More

Tier-One FIFA World Cup sponsors pay almost $125 million for the right to reach 30 billion sets of TV eyeballs and almost 3 million stadium attendees.  Add in the enormous investment necessary to leverage the FIFA relationship (through ad materials, hospitality events, commercials, etc…) and only a serious company can join the elite group of six tier-one partnerships offered by FIFA.  It was therefore surprising when it was announced that little known Chinese renewable energy company, Yingli Green Energy,  had joined titans such as McDonalds and Budweiser in the upper echelon of sports sponsorship.  The deal entitles Yingli to stadium advertising, the use of the FIFA mark, prime real estate in fan zones and much more.

Few events offer the worldwide reach of the World Cup and Yingli is taking an enormous gamble that sports fans will bring market share.  According to the Sports Business Journal, “Yingli signed its World Cup sponsorship because it believed soccer’s popularity would help the company raise brand awareness in key markets such as Germany, Italy and Spain, and potential markets such as Brazil and Africa.”  In addition, Yingli is hoping to develop relationships with other business and business leaders to increase brand awareness and sales.   Yingli develops, manufactures and sells photovoltaic modules and trades on the NYSE.  The company joins new MLS sponsor Continental Tire (a lower level World Cup sponsor) under the FIFA umbrella.

Multiple news outlets are reporting on the competition to host MLS Cup.  Cities such as Philly, Toronto and Los Angeles are vying to host the 2010 championship.  Most interesting to us, is the information contained in this article from the Toronto Star, about the value of hosting special soccer events.  According to the article, the MLS All-Star game generated $28 million (Canadian) over three days in tourism dollars while Real Madrid’s Canadian visit generated $10 million. These are the types of arguments typically raised to bring in big sports events, check out our interview with Simon Kuper, the author of Soccernomics for the other side of the argument.

Finally, Kyle McCarthy talks through the recent MLS announcement that all matches will be produced in HD for 2010.  According to the article, “MLS officials decided to make the move to HD production in an effort to compete with the high-quality broadcasts of English Premier League matches and supply fans with a better local television product that reflects the improving quality of play on the field…”  For those interested in the business of broadcasting soccer, we recommend reading this piece.

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One Response

  1. Wow that is a staggering amount of money. I guess that makes sense though. The most popular sporting event when it comes around every 4 years. Great read!

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