Posts Tagged ‘International’

The big sportswear brands have their biggest stakes in individual athletes. Not a day passes when we don’t see some big sports star on our TV or computer screens.

The 2010 World Cup in South Africa was the last for David Beckham; it was also supposed to be the big debut for stars like Kaká, Messi and Cristiano Ronaldo. With Beckham on the sidelines before the tournament even began, and the rest of the sport’s stars bowing out too soon, we reached the World Cup final with other figures who, starting Monday, will be in good shape to demand much more money from their sponsors.   They’ve earned it.

The three main sportswear brands- Nike, Adidas and Puma – were surely disappointed to see their big stars out of the final.  They’ll “only” be watching “their” teams duke it out.

In fact, the quarterfinal lineup seems like it was tailor made so that the big three could balance their budgets:

- Holland (Nike) – Brazil (Nike) - Uruguay (Puma) – Ghana (Puma) - Argentina (Adidas) – Germany (Adidas) - Paraguay (Adidas) – Spain (Adidas)

Adidas already knew it would see one of its teams in the final, while Nike and Puma, on the other hand, were left to fight it out in the semifinals.  After Sunday’s game, one of the big brands could keep winning after the game.  Game results go hand in hand with immediate profits.  For example, after England was eliminated from the World Cup, the price of an England team jersey dropped from £ 40 to £ 28.

There have also been lesser-known brands represented in this World Cup: Umbro (England), Joma (Honduras), Brooks (Chile), and Legea (North Korea). These last three have surely gained a higher return on investment than they expected when they negotiated their contracts with their respective teams.

In the U.S., soccer and the World Cup have their detractors- making comparisons of watching the sport to watching grass grow, for example. Yet advertisers have shown interest, and in many cases are being rewarded by a U.S. audience that is now tuning in.

According to a recent article in the Wall Street Journal, 30 seconds of commercial time for the World Cup finals is costing roughly $250,000, compared to $100,000 for the NHL’s Stanley Cup Final- a steal compared to the Super Bowl’s roughly $3 million for a 30 second spot. Ad executives are jumping into the fray due to the increasing diversity of the U.S. audience, and specifically the ability to reach U.S. Hispanics.

Previously we have discussed the soccer advertising rivalry of Adidas, Puma and Nike, although many other traditional advertisers are involved with World Cup South Africa 2010, including Budweiser, Samsung, Allstate and Sony, just to name a few. According to Nielsen, this ad from Hyundai is making a very strong showing:

In advertising, just as in every sport, there are winners and losers.  While Hyundai is scoring with the “Die Hard” commercial shown above, they decided to pull an earlier ad showing an Argentine church with stained glass depicting a soccer ball and worshippers receiving slices of pizza instead of traditional communion, due to complaints from the Catholic church and others claiming the ad was insensitive.

Overall, advertisers have welcomed the World Cup; a big reason is their recognition of the importance of the Hispanic market and overall diversity of the U.S. market. This is a boon for an advertising industry that is coming off one of the worst years ever. With forecasts from ZenithOptimedia expecting global ad spending this year to grow 2.2% to $456 billion (which is $1.2 billion more than it would have been without the World Cup), there is reason for those agencies focusing on diversity to be encouraged.

The debate always continues for the countries that decide to host major sporting events, such as the Olympics or World Cup, as to overall long-term value to the country.  For countries such as Chile, who qualified for the World Cup for the first time since 1998, the spending on jerseys, televisions and other products present an immediate boost to the economy.

In terms of advertising, the final numbers will be very interesting, and estimates have companies spending more than a billion dollars to promote their products at the World Cup.  In the U.S., we are already seeing some excellent ads from the retail side (Nike, Puma, Adidas).

However, there is an economic downside to the World Cup that will be seen on a global level- that of the loss of worker productivity.  While in the U.S. the effect will most likely be less than that of NCAA Basketball’s March Madness, you can certainly expect a significant loss of productivity from the fans of all teams involved in the World Cup who will be setting up their brackets at ESPN, or who may be just a little less focused than usual when their team is playing.

According to a recent article in U.S. News and  World Report, the World Cup will likely cost American companies 10 minutes of productivity a day for 21 days, which is estimated to be about $121.7 million in lost productivity in the U.S.    In other countries, the figures are much higher, with the British economy forecasts estimating a cost of $7.36 billion. While I haven’t yet seen calculations for countries such as Brazil, Italy, Mexico and Chile, I’m sure the costs will be staggering as well.

From a business perspective, it is just good business to know the World Cup schedule, so that if you need to call on a company in Mexico on game day, you’ll know to wait until after the game is over before calling.  If you are happy about a U.S. win over England (hopefully), you may want to keep the gloating to a minimum when speaking with a client who is English.

So check your local World Cup viewing guides such as this one for San Francisco, download the appropriate app for your phone, pick up your team’s jersey at Nike Online,  set up your office pool, work on your fake cough, and of course  get to bed early as the games are at odd hours (all South Africa time).  For those who are even a bit more daring there is of course numerous online gaming options such as this one

Slate.com’s Seth Stevenson regularly reviews ads for the site’s Ad Report Card feature, and the reviews are often a chance to dissect why an awful ad is so awful. Yet he gave a glowing review to Nike’s now famous World Cup ad, giving it an A+.  Reading his review, I learned a few things about the ad I hadn’t known before, like that the cheesy Italian TV show that Fabiano Cannavaro appears on is hosted by “Italy’s Elvis”, Bobby Solo; that the billboard above Wayne Rooney’s trailer is a parody of one he appeared in back in his native England, which was a bit contorversial; and that the whole cinematic spectacle was directed by Oscar-nominated Mexican director Alejandro Gonzalez Inarritu.  The video can be viewed again here.

Every sport has teams whose fans love to hate a rival team (and their fans). Whether it is for past defeats in championships or the trade of a star player (see Babe Ruth and the ensuing Red Sox curse) these rivalries create a passion in the sport that is unrivaled.

The same competition and disdain can be seen between top brands through their advertising; many of them, such as Pepsi versus Coke, with the 1980’s Pepsi Challenge ,or the more recent Verizon versus AT&T with the battle of the coverage maps, are very direct in their criticisms. While these behemoths compete on a year-round basis, specific sporting events such as the Super Bowl, Summer Olympics and now the FIFA World Cup bring out some serious ad spending and creativity that many times is as entertaining as the actual event.

One rivalry of particular interest with the World Cup around the corner is the advertising battle between the footwear brands Nike, Adidas, and Puma. For the 2006 World Cup in Germany, Puma was the best represented brand with 11 countries, versus 8 for Nike and 6 for Adidas. For the 2010 FIFA World Cup in South Africa, Nike jumped out to an early lead in the advertising battle with the viral video ad “Write the Future” ,which has been an early success. While not an official sponsor, the Nike swoosh is prominently displayed on jerseys for such teams as Brazil, Portugal, Holland, USA, Australia, New Zealand, and South Korea.

Puma, the sponsor of such teams as: Italy, Cameroon, Algeria, Switzerland, Paraguay, Czech Republic, Poland, Tunisia, Ivory Coast, Ghana, Uruguay, and Angola also recently launched its first ad, which has a focus on African football and features background music by Gnarls Barkley. While the overall theme may be soccer and the timing and visuals relate to participants in the World Cup, Puma is also not an official sponsor, and as with the Nike ads, they do not use the logos associated with FIFA or this year’s World Cup. Enjoy the African football-focused ad here:

^

(more…)

Ad location: Spanish television/YouTube

Medium: Video

Brand: Estrella Damm Beer

Overall Grade: A

Quick Review:

This ad makes you feel young if you’re old and makes you glad to be young if you are still young.   It is a refreshing ode to carefree, lazy summer days spent with friends, to the spontaneity that occurs when the weather is nice and you have no plans- so you can set sail with your buddies and enjoy a case of Estrella Damm beer.  I give this ad points for showing people enjoying beer in a normal, everyday context while not falling prey to typical beer commercial cliches (crazy, raucous parties; dudes being dudes; etc).  The ad is targeted to young men, but women are featured enjoying the beer as well- the flirtation between one guy and girl is the source of the ad’s tag line, “A veces lo que buscas está tan cerca que cuesta verlo” (“Sometimes what you’re looking for is so close it’s hard to see”).  Major points for stunning visuals, a pretty song, relevant use of the product, and putting a smile on the viewer’s face.  Makes you want to spend a weekend in Spain enjoying some Estrella Damm beer!

With over 7.8 million views in its first week, the Nike Write the Future ad for the World Cup has broken all viral video records for views. While  initially pulled by YouTube for copyright issues, the video is alive and well again for everyone to see:

Even more interesting is that the previous holder of the viral record was another Nike Ad released earlier in the year and reaching 6.3 million views. It is a much more somber ad featuring the ghost of Tiger Woods’ Dad speaking to him anddefinitely not as uplifting and exciting as the World Cup ad. Here is the Earl and Tiger ad, however for pure entertainment value there are plenty of spoofs on the Earl and Tiger ad that may be worth killing some time.

It is coming- the most watched event in the entire world…NO not the American Idol season finale, but FIFA’s 2010 World Cup, taking place in South Africa.  Yes, soccer…..a sport that has a high level of participation for kids in the U.S. but has shown little ability to reach Americans as a major television event, even with a solid U.S. Team and David Beckham’s arrival to the U.S. professional league MLS (Major League Soccer).

How will most Americans even know that there is a major sporting event taking place starting June 11?  Of course the answer is advertising, as it is for every major sporting event from the Super Bowl to the Olympics.  And the wave of advertising has begun.

In Latino communities, the billboards have been springing up, such as this one from Verizon in San Francisco’s Mission District, which reads, “Para ver 64 partidos en vivo, quieres 3G de Verizon” (To see 64 games live, you want Verizon 3G).  The major marketing publications such as Advertising Age are also getting into the act, with discussions about major investments by such advertisers as Nike, whose World Cup ad, as cleverly pointed out by Ad Age, uses the images of major players playing for teams sponsored by Nike without mentioning the World Cup (Nike is not even a sponsor).   You can see the Nike commercial at Ad Age, as well as read the publication’s review of the ad.  Since this is a global sporting event, we expect to see some very interesting advertising and are looking forward to an entertaining Mundial.

According to data from the IAB (Interactive Advertising Bureau), investment in digital advertising in Mexico increased 24% in 2009. Investment of ad dollars online reached 2.345 million pesos.

There have been decreases in ad spending in various media like radio, open television and magazines, but other media, like television and Internet, have seen important growth.  Nestor Marquez, President of the research committee of IAB Mexico, stated that the growth in online advertising is eight times bigger than in 2005.

Social networks (such as MiAltos) among channels (76%) and video ads among formats (44%) saw the biggest growth.

At the “Global American Technology Alliance” blog of Michael Muth, a graduate of the prestigious Thunderbird School of International Management, there is a recent post describing the author’s experience living and working in Germany, and how it compares to that of other international business students in the U.S. Muth describes the experience of arriving in Germany with “textbook German”, and then, after an extended stay in the country, improving his language to the point of being mistaken for a local.  He became familiar with the rhythms of everyday life in Germany, and learned the work culture from the inside out.  This stands in contrast to the experiences of students from the University of South Carolina’s International Business program, who stayed for a semester, and only observed German workplaces.  While this provides an eagle eye view of the German company and German culture, 3 months is barely enough time to scratch the surface of a foreign culture.

I can say from personal experience that Muth is absolutely correct.  It was my observation, as a student who spent a year of study in Spain, that the students in the semester program left the country just as their language skills were beginning to improve.  After ten months in Spain, I thought, spoke and felt like somewhat of a Spaniard. And yet, year later, after three months in Mexico, I felt that just I was beginning to really learn the local culture and pick up the slang, I had to pick up and leave.  For the person who wants to get into international business, a thorough knowledge of the host country is vital.  “Helicoptering” in, observing a company’s behavior and saying a few words in the local language can be done by anyone.  But to get the deal closed, to get to the heart of the matter easily with foreign colleagues, it is so important to feel at ease in the language and culture in the country where one does business.