This article went from simply being a fun idea, to actually something kind of interesting. Warning: If you don’t feel like dealing with numbers, pass on this article. Feel free to correct me or provide your insight (it’s late, so I may have messed up somewhere).
As one can guess, the World Cup is a major benchmark for international soccer brands. It’s pretty much their time to make some serious moola. By “their” I mean Adidas, Nike, Puma, and a few other companies that you probably have never heard of. This past World Cup 12 national teams were sponsored by Adidas, 9 by Nike, 7 by Puma, and Umbro, Brooks, Legea, and Joma had each sponsored 1 (Umbro is actually an entity of Nike but is kept under a separate brand. So really, you can say Nike had 10).
So what if we looked back at the World Cup and made it into a competition of brands as opposed to international soccer teams? It would look something like this:
Just for making the WC every team gets $1 million. For exiting in the round of 16, teams make an extra $8 million. For exiting in the quarter-finals, they make an additional $9 million. And then the patter continues in the semis with teams making $14 million more. Additionally, the 4th place team gets a bonus of $18 mil., 3rd gets $20 mil., 2nd gets $24 mil., and the winners get $30 million.
Using Adidas as an example, the teams that Adidas sponsored netted a total of $182 million in prize money this past World Cup. We can then take this number and look at it as if Adidas themselves “made” $182 million (the prize money isn’t actually going to Adidas but there is a subtle correlation between prize money — which is essentially how well these teams do — and how much the company gets out of sponsoring them). The cost would then be the amount Adidas spent in sponsoring all of these teams for the WC.
So there you go. Even though Adidas’ Spain won it all, it was Chile that exceeded all expectations. Puma did well and so did Adidas. But Nike’s “Write the Future” campaign may have just jinxed their 2010 World Cup, as they did the worst in our little 2010 WC brand simulation. As you can see, their time and efforts in investing in Umbro didn’t really pay off… Or did it?
Unfortunately, World Cup prize money isn’t the most precise indicator of how well a World Cup jersey sponsor does by any means. In fact, Spain’s victory alone has just catapulted Adidas’ sales tremendously. And even though England didn’t get too much prize money from this World Cup, the amount of money they’re making just off their kit sales has well exceeded their WC reward.
But what we can conclude is that brands like Adidas, Puma, and Brooks (still not sure how the hell they got into soccer…) should continue sponsoring their teams, and the other brands should look to other national teams for a better “return on investment” in 2014.