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Qatar World Cup controversy means sponsors are walking a tightrope, says branding expert – News Opener

As Qatar prepares for the start of a World Cup mired in controversy, the tournament’s big-name sponsors find themselves in a tricky position.

FIFA’s list of partners includes U.S. corporate titans Coca-Cola Co.

and Visa Inc.
who will both be involved in the Qatar event. Anheuser-Busch InBev/Budweiser

and McDonald’s Corp.

are also signed up as World Cup sponsors. But the plight of migrant workers in Qatar, along with LGBTQ+ rights in the Gulf state, has sparked a backlash ahead of the soccer showpiece, which kicks off Nov. 20.

James Kirkham, founder of the marketing consultancy Iconic and former head of soccer agency Copa90 says companies are navigating a tricky path.

“The tightrope is very thin and delicate,” he told MarketWatch. “On the one hand, this is arguably the world’s biggest sporting event (Olympics might say differently) where the watching world ensures huge commercial opportunity … but on the other, there is a dilemma around how much you can be seen to articulate a celebratory support for a tournament which is being played out in a country with such questionable human rights issues.”

The World Cup was awarded to Qatar back in 2010, on the same day the 2018 World Cup was awarded to Russia, a decision which also attracted criticism over human rights. The awards to Russia and Qatar also sparked a massive investigation by the U.S Department of Justice that brought down many of FIFA’s former leadership.

See Now: With Qatar World Cup looming, Amnesty again urges FIFA to compensate migrant workers

Qatar World Cup sponsors knew what they were in for, says Jim Andrews, founder and CEO of A-Mark Partnership Strategies, which provides sponsorship guidance to companies. “None of this was a surprise to any of these companies,” he told MarketWatch. “These are global companies that face questions about doing business in lots of places.”

“We saw a very similar situation not so long ago in Beijing around the Winter Olympics,” Andrews added. “They have made a calculated decision that, as much as they will face some consumer backlash for supporting an event in a country where there are human rights issues, there are enough of their customers and clients that will hold their noses and close their eyes and still watch the soccer.”

The number of people tuning in to watch a World Cup is, quite literally, eye-popping. FIFA data show that a record 3.572 billion people watched the 2018 World Cup in Russia, more than half the world’s population. That figure includes viewers watching TV at home, outside their home, or on digital platforms. The World Cup final between France and Croatia was watched by a combined 1.12 billion viewers worldwide.

The World Cup equals big dollars. The 2018 competition delivered a significant boost to sponsor Adidas AG’s

earnings and generated almost $5.4 billion in revenue for FIFA. Qatar is expected to bring in $6.5 billion for FIFA, according to sports marketing company Sports Value.

While the World Cup brings billions of eyeballs (and dollars), the Qatar controversies cannot be ignored, according to Kirkham. “The tournament poses challenges across the board,” he said. “Some of the world’s biggest brands rely on playing a positive role in culture, with an open-minded and appropriate position around social freedoms, cultural norms, liberty to express yourself and more.”

See Now: Qatar’s World Cup ambassador calls homosexuality ‘spiritual harm’

“To simply appear blinkered and unmoved by the realities of the location would be to act tone deaf to their consumers,” he added.

So sponsors want to be part of a conversation around education on these issues, according to the marketing expert. “They’ll want dialogue to move on [and] see previously outdated thoughts and philosophies of leaders and governments move into a more progressive outlook,” Kirkham said.

Kirkham describes the Qatar World Cup sponsors as very sophisticated in terms of understanding the power of their brands. “They’re able to have an on-the-ground presence, actual space such as branded hotels or bars or fan zones where an oasis of cultural ‘cool’ and added value is delivered to the traveling fans, all able to suck up the essence of that brand,” he told MarketWatch. “Likewise, the integrated PR, marketing and social teams are entwined with powerful social publishers in and around the game – they have an ability to quite literally influence the content, the social streams, the content of millions of people watching along on their phones.”

Given the power of these brands, it’s no surprise that activists have been working to draw them into their efforts to bring about change in Qatar.

In May, Amnesty, along with 23 other organizations, wrote an open letter to FIFA President Gianni Infantino urging a “remedy for labor abuses behind the 2022 World Cup.”

See Now: Why the stock market gets a red card during soccer’s World Cup

World Cup sponsors Coca-Cola, McDonald’s, Anheuser-Busch InBev/Budweiser, and Adidas have supported calls for financial compensation, according to Amnesty.

In a statement provided to MarketWatch, McDonald’s described “the power of football” to uplift and connect communities. “McDonald’s can be a force for good, including when it chooses to leverage sponsorships, like at the World Cup,” it said.

“We also recognize that businesses like ours have a responsibility to respect human rights within our sphere of influence,” the company added. “We believe the advocacy surrounding the World Cup coming to Qatar has led to positive change and momentum regarding human rights, including safety and workers’ rights, in the host country.”

“However, we also recognize there is more to be done to ensure that the World Cup leaves a positive legacy in Qatar,” McDonald’s said. “We will continue working with FIFA, human rights experts—including the Centre for Sport and Human Rights – and the other sponsors to spur positive change and respect human rights, both around the tournament and in the communities we serve.”

In a statement posted on its website in May, Coca-Cola also pointed to its work with the Centre for Sport and Human Rights, which aims to prevent human rights violations linked to sport. Coca-Cola described the 2022 World Cup organizing committee as having taken positive steps to address past challenges.

FIFA’s advocacy has led to some significant reforms to improve the rights of migrant workers in Qatar, according to Coca-Cola. “However, we recognize that further reform remains to be done,” the company added. “We expect FIFA to continue working with Qatar and future host countries to ensure human rights, including workers’ rights and safety, are respected in sport.”

See NowThis strategist has picked the last two World Cup winners. Here’s who he says will win it this time.

Anheuser-Busch InBev directed MarketWatch to a statement that also highlighted its work with the Centre for Sports and Human Rights and cited reform in Qatar.

“We recognize that important labor reforms, such as implementing minimum wage and dismantling the employer sponsorship or Kafala system, have been established to improve the rights of workers in Qatar; however, more can still be done,” the statement said. “We support access to procedures that can achieve fair remedies to migrant workers who have been negatively affected.”

The death toll of construction workers in Qatar remains firmly in the spotlight, with Amnesty International describing thousands of migrant worker deaths since 2010. The deaths cited by Qatar are significantly less and the country’s Supreme Committee for Delivery & Legacy described Amnesty’s May letter as inaccurate.

“Over the past two decades, Qatar has initiated an overhaul of its labor system, with extensive action taken to benefit the millions of workers in our country,” said a Qatari government official, in a statement emailed to MarketWatch last week.

World Cup 2022: How to watch, who’s favored to win and everything else you need to know

This is the first World Cup in the Arab world and also the first to take place in the Northern Hemisphere winter, to avoid searing summer temperatures in Qatar. But the level of controversy surrounding the event, particularly after criticism of the Russia World Cup and the Sochi and Beijing Winter Olympics, could have an impact on where major sporting events are held in the future, according to Andrews.

“Privately, FIFA and Olympic sponsors have told me they have had conversations with these organizations and said ‘don’t do this again’,” he told MarketWatch. “FIFA is a bit of a wild card, but the IOC has definitely heard that message and I believe it will be a lot more judicious in selecting future host cities.”

Fox Sports, which is owned by Fox Corporation
the sister company of Dow Jones parent News Corp.
has broadcast rights to the Qatar World Cup.

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