Corruption crisis hinders search for new sponsors

Published 1:50 am Saturday, July 25, 2015

ST. PETERSBURG, Russia — The FIFA corruption crisis is hurting its search for new World Cup sponsors.

Targeting almost $6 billion in revenue from the 2018 tournament, FIFA has not signed any new sponsors since last year’s World Cup in Brazil.

“Definitely the current situation does not help to finalize any new agreement. That is a fact,” FIFA secretary general Jerome Valcke said Friday ahead of this weekend’s qualifying draw.

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The first big event for host Russia has brought hundreds of international media to St. Petersburg, offering a natural stage for a sponsorship launch. However, Valcke said no major deals would be completed until FIFA’s future is clearer — after Sepp Blatter is replaced as president next year.

“I’m sure until the (presidential) election, until the 26th of February, there will not be major announcements,” Valcke said, adding that “at least two major companies” have been in negotiatons.

Amid growing frustration with FIFA since May 27, when American and Swiss federal investigations of alleged bribery and money-laundering were revealed, current sponsors have asked to meet with FIFA management.

FIFA received a letter from sponsors this week and will organize a briefing in August by its lawyers and marketing officials, Valcke said.

Valcke spoke at a news conference hours after Visa said FIFA’s responses to the recent crisis were “wholly inadequate.”

“We believe no meaningful progress can be made under FIFA’s existing leadership,” the United States-based credit card company said Thursday.

Long-time FIFA backer Coca-Cola and second-tier sponsor McDonald’s have also broken ranks from their traditional loyalty by criticizing the football body’s handling of bribery allegations. Two of FIFA’s eight vice presidents were among 14 soccer and marketing officials indicted in the United States in May.

Blatter and Valcke are expected targets in the U.S. Department of Justice’s case.

FIFA’s slate of current World Cup sponsors is looking thin as its seeks to fill 34 available slots for two-tournament packages taking in the 2018 event in Russia and the 2022 tournament in Qatar.

Two top-tier sponsors, Dubai-based airline Emirates and Sony, were among several commercial partners who did not renew last year.

Only seven of 14 available positions in FIFA’s top two commercial categories have been filled, and none of the 20 slots in a new regional category designed to increase revenue from the 2010-2014 tournament cycle.

FIFA earned $1.63 billion in marketing revenue tied to the 2014 tournament in Brazil. Its total “event-related revenue” in that four-year commercial period was more than $5.1 billion, the governing body’s accounts showed in March.

Valcke said the 2018 tournament should be worth more and insisted FIFA was not behind schedule in signing deals to meet its revenue targets.

“No, it’s not too late as long as we are doing it in the early part of 2016,” the French official said.

With some sponsors committed to other big events in 2016 — such as the Olympics in Rio de Janeiro and the European Championship — promotional campaigns tied to the 2018 World Cup would typically start after they are finished, Valcke said.

Blatter’s right-hand man since 2007 is unlikely to clinch the new contracts. FIFA rules require the president to propose appointing a secretary general and a new leader elected in February will want to choose his own person, Valcke said.