2018 World Cup: Year of the underdogs as advertisers scratch their heads
Much to the shock of fans of this year’s World Cup, some of the major teams like Brazil and 2014-winner Germany have had lackluster showings, each scraping a win instead of triumphing with flying colors against less celebrated teams.
Addidas, a German brand, is set to lose $32 million in sponsorship kits if Germany fails to move to the next round tonight.
Mexico beat Germany with a 1-0 score in its opening game, much to the surprise of everyone. The European country was selected as the 2nd team most likely to win the World Cup by our readers, following a survey we conducted. Yet, they are still on the ropes, as their fate depends on their final game in the current stage. Should they fail, it would mark their first group stage exit in 80 years.
Brazil faces a similar fate, and Argentina just barely made it to the second stage last night.
The World Cup is predictable if anything. The teams mentioned above always float to the top, one way or another, their names gracing semi-final lists every 4 years. But now, the lesser known teams are taking names and scoring wins. Croatia, for one, is out with a vengeance, crushing all opposition.
Russia is performing against expectations, decimating Arab teams Saudi and Egypt. Keep in mind that Russia according to FIFA estimates was the least likely to win the World Cup.
Their win streak has been trumped by Uruguay however, who has always been the underrated team that sneaks their way to the top year after year.
If by some chance major contenders fall off in the coming stages, advertisers could be stepping into uncharted territory.
What money loves
Most brands’ spending is geared towards the big teams: Germany, Brazil, Portugal and such. With the possibility of lesser known teams such as Croatia and Russia powering through, boasting lesser known players, advertisers will have to reconfigure their marketing strategies.
Lionel Messi’s sponsorships and endorsements amount to $27 million, according to Forbes. Mastercard, Huawei, and Pepsi are among the companies that have staked a claim with the Argentinian player. To top it off, he has a lifelong deal with Adidas. If the Argentinian team were to lose last night’s game and exit in the group stage, the lost $27 million would’ve kept his sponsors awake at night.
Portugal’s near exit almost cost advertisers $47 million, with Cristiano Ronaldo being endorsed by the likes of Nike and Electronic Arts.
The top 5 sponsorship kit deals were held by some familiar names: France, England, Brazil, Germany, and Spain. While Nigeria’s kit has received the most attention, their deal cost advertisers $3.75 million, with a $500,000 bonus following their qualification for the tournament. Compare this number to France’s highest value kit deal at $54 million, according to figures by Sports Sponsorship Insider.
What money should love
Advertisers need to consider riskier investments by banking on the lesser known teams and players. When Jim Furyk, a relatively unknown pro golfer, won the 2003 US open, sponsors Hogan clubs, Exelon and Strata (the hat he was wearing) made major bucks on the back of this underdog.
They would have paid him a lot less than they would have had to someone as big as Tiger Woods, yet their minor investment paid greatly in the end.
Top players are expected to win, but the hype almost always goes to underdogs when they win, and by endorsing these up and coming players, advertisers could stand to make a lot of money, as well as gain exceptional exposure.
In the end, it’s the sponsors who have studied the different teams and their players’ performance leading up to the World Cup and made the best-calculated investments that will reap the most. If Brazil and Germany fail to make it through today, things are about to go sideways for their sponsors.
This year’s tournament is truly shaping up to be the year of the underdog.