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FIFA sponsors are the only ones who can splatter Blatter

November 20, 2011

Well, what a week of wasted moral outrage that was, even if it did produce one of The Sun’s finest headlines for a very long time.

Make no mistake. “Splatter Blatter” may have sold extra copies of the red-top, but will do nothing to remove the Teflon Man, whose life’s achievement has been to carve himself an impregnable position as world football’s supremo.

In a way, you’ve got to admire him. Like Bernie Ecclestone, whom he resembles in a variety of ways, Blatter is a master tactician at the top of his own, very particular, game: not the administration of Formula One or FIFA, but the administration of power.

The secret of their supremacy is the same. It lies not (or very little) in formal status, but in a second-to-none understanding of how to manipulate an opaque global system that has no loyalty beyond its self-perpetuation.

To be sure, FIFA and F1 are, or have, venerable governing bodies guided by what appear to be democratically elected representatives acting in accordance with a constitution. In reality, the election of these officials is manipulated to suit insiders; and the workings of the institutions they represent are so complex and well-defended that they defy almost any outside attempt to hold them to account.

If there is any parallel to representative government, it is the quaint Rotten Borough system that existed in Britain before 1832. Boiled down to essentials, it involved the King and his chosen First Minister fixing a parliamentary majority by procuring the election of their chosen placemen in all the seats that actually mattered. For placemen read “men in blazers”, and you get the picture.

Corruption was the indispensable lubricant of this system. It involved greasing people’s palms, and not just at election time. The disbursement and retraction of patronage – primarily offices of state awarded on the basis of interest rather than merit – was key to successful management.

Recognise the parallel? Allegations of corruption have plagued Blatter’s 4 consecutive terms of office, culminating in the 2018 World Cup scandal that broke earlier this year. As for F1 scandals, need I enumerate them?

But what do Blatter or Ecclestone care about that? The same opacity which protects these organisations from outside investigation also insulates their ringmasters from public criticism – and any punitive measure that might result from it. Hence the stream of crass remarks that regularly issues from their mouths. For Bernie, Hitler was an OK bloke who built excellent roads even if he did later succumb to a power complex. For Blatter, racism on the pitch is a non-issue which can be settled with a handshake at the end of the match. Out of touch, clearly. But then, so what? They’re also out of reach, and they know it.

Blatter has deftly deflected calls for his departure from the likes of David Cameron, David Beckham and The Sun by portraying the outcry as a case of sour grapes. Only Britain has worked itself up into a national lather over racism on the pitch. Why? Because England lost out in the contest to become 2018 World Cup host, and is now conducting a vendetta against the man perceived to be its nemesis.

So, can he now blow the final whistle and move on? Not quite. If there’s one chink in Blatter’s armour, it’s money – or rather its threatened withdrawal. What if the sponsors – household brand names, with household reputations to maintain – deem he has gone too far and pull the plug on the hundreds of millions of pounds a year that FIFA depends upon for its survival?

Ordinarily, that simply wouldn’t happen. However much they may privately tut-tut about Bernie’s ex-wife spending £12m on their daughter’s nuptials, Max Mosley’s grubby sexual antics or Blatter’s moral insensitivity, the last thing they are going to do is scupper a strategic investment with a noble gesture. Their investment is, after all, in the global game, not the administating organisation and the people who lead it. And their justification for inaction the not unreasonable conjecture that most football and motor-racing aficionados have little knowledge and less interest in the shenanigans of sports administrators.

One sponsor’s uncharacteristic response to Blatter’s racism episode is what, in fact, makes this furore so interesting. True, most of FIFA’s six official partners have played entirely true to form. Coca-Cola has categorically rejected a review of its sponsorship; while Visa, Hyundai/Kia, Sony and Adidas have contented themselves with more or less bland statements condemning racism in sport. But Emirates has broken ranks by taking the almost unprecedented step of reviewing its sponsorship.

Whatever next? Not Blatter’s resignation, for sure. But perhaps the beginning of the end of his reign.

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FIFA’s Sepp Blatter and Max Mosley are two of a kind

June 1, 2011

Will the sky fall in on Sepp Blatter, much reviled president of FIFA, just because Coca-Cola and Adidas, Visa and Emirates Airline – 4 of football’s 6 biggest sponsors – have fired a shot across his bows?

Will the English and Scottish football associations’ vociferous appeals for a postponement to FIFA’s presidential election – which currently leaves Blatter dribbling up to an open goal – make an iota of difference?

No and no. The contest between FIFA and its critics is asymmetrical precisely because, unlike Coca-Cola and its fellow sponsors, FIFA is not a brand. It is not vulnerable, in the first degree, to public criticism – however merited or angry that criticism may be.

Indeed, as Matthew Patten recently pointed out, FIFA resembles nothing so much as a medieval guild. It owes allegiance to no one other than the 208 merchant adventurers who make up its membership. Nothing, culturally speaking, could be more removed from the modern corporation. There is no transparency in its business dealings, because the daylight of accountability is not an element in its constitution. The anonymous men in blazers ply their trade in a way that is endemic to all closed mercantile organisations: through mutual back-slapping, nepotism and, let’s face it, financially lubricated manila envelopes – if they think can get away with it. And lording it over them are the merchant prince oligarchs: men (they are always men) like Sepp Blatter and Mohamed Bin Hamman.

FIFA is part of a pattern which, if not peculiar to the administration of world sport, is certainly highly characteristic of it. Remember the cleansing of the Augean Stables at the International Olympic Committee (IOC), after the corruption scandal that was the Salt Lake City Winter Olympics bid came to light in 1998? That was a relatively benign outcome. Less satisfactory have been the consequences of the more recent shenanigans at Formula One. Despite the engulfing stench of scandal, and the twittering of vocal criticism, its twin ringmasters Max Mosley and Bernie Ecclestone managed to protect the integrity of their power base. Admittedly Mosley eventually went, but it was at a time of his own choosing and on his own terms. Ecclestone, meanwhile, continues to crack the whip without let or hindrance. He is currently said to be negotiating an exit deal with Rupert Murdoch.

Blatter, a man who once fronted an organisation dedicated to stopping women exchanging their suspender belts for pantyhoses, is more likely to draw his inspiration from Mosley than the aftermath of the Salt Lake City scandal. He will brazen the “crisis” out.

And there is little, in the last analysis, the sponsors can or will do about it. On the surface, that might seem a strange thing to say. After all, they are bankers to the organisation and provide its marketing pot. Each contributes between £100m and £300m to a FIFA revenue estimated at £2.4bn in the 4 years up to and including World Cup 2010. Surely that gives them more clout than most stakeholders in the struggle to wring reform from the World Cup organiser? Only up to a point. Let’s not forget that FIFA is less dependent upon sponsors these days to the extent that it can dip into billions of dollars worth of syndicated worldwide TV rights. Moreover, rather than presenting themselves as a united front, the sponsors perceive themselves as embattled and vulnerable competitors (rather like the constructors in the F1 equation). Blatter, like Ecclestone, is a supreme tactician in exploiting such weaknesses. There’s always someone else, he will say, to take their place if they don’t want to play ball. A Pepsi for a Coke, a Nike for an Adidas, a Delta for an Emirates, a Mastercard for a Visa.

And do you know what? He’s right. The only chance the sponsors have of effecting change is if they stand united. My suggestion is not that they threaten to defect, merely that they withhold some of their funding until tangible reforms, prime among them greater transparency and accountability, are in place.


WikiLeaks proxy war takes its toll on brands’ integrity

December 9, 2010

It hasn’t taken long for the proxy cyber war being waged between WikiLeaks, the whistleblowing site, and the US state department to spill over into the world of brands.

Yesterday, Operation Payback – manned by a bunch of freelance cyber hackers who have taken up the cudgels on WikiLeaks’ behalf – managed to shut down the website operations of Mastercard: not only http://www.mastercard.com but some of its SecureCode operations as well. It was a serious piece of hacking that felled the international credit card operator at a highly vulnerable time – on one of the key shopping days before Christmas.

Other household names are likely to experience similar trauma. Visa has fought off a guerilla attack, but more may follow. Amazon is in the firing line. Paypal is already experiencing grief. And Twitter will probably follow.

Their offence? According to Anonymous, the nom de guerre of the aforementioned cyber warriors, they have stepped out of commerce and into politics by colluding with a politically inspired campaign to close down the WikiLeaks site and must be prepared to take the consequences. In the rougher language of the hackers: “We will fire at anything, or anyone, that tries to censor WikiLeaks, including multi-billion dollar companies such as PayPal…Twitter, you’re next for censoring WikiLeaks discussion. The major shitstorm has begun.” Twitter’s offence, which it denies, is to have pushed the WikiLeaks affair down the “trending” algorithm, effectively denying it the oxygen of publicity.

Whether these cyber attacks will in themselves do lasting damage is to be doubted. Far more corrosive is the bad publicity for the brands involved. They are seen to have taken sides, and acted not on behalf of the consumer but on behalf of the US state department. Under pressure, they are forced to admit that they have suspended operations with WikiLeaks because these operations are now deemed illegal. By whom? By the US state department, invoking not the jurisdiction of international law, but its own. In other words, the brands involved are yielding to a form of blackmail, for fear of reprisals in their single biggest market.

It is no surprise to find the US administration acting vindictively. No state likes to lose face in public – and WikiLeaks founder Julian Assange has certainly made a mockery of the USA’s much vaunted cyber-protection systems (or at least, the Pentagon version of them). Moreover, we’ve seen this sort of behaviour in the past. Philip Agee, the renegade CIA agent, was hounded for many years by a vengeful state department. More recently the US has pursued with a vigour bordering on persecution an extradition order against UK citizen Gary McKinnon, who is accused of hacking into Pentagon secrets (why is it always Pentagon systems that are so insecure?). UFO-fancier McKinnon faces up to 70 years imprisonment if the order eventually succeeds.

In the case of brands, however, the damage is subtler and collateral. For all their pretensions to globalism, they have found themselves manipulated by a national government – which just happens to be the most powerful in the world. If all this had taken place in China – as it did when the Chinese state began to shut down Google’s operations – the outrage would be international. But when the USA does the same thing, reaction is muted. The implied impediment to free e-trade is taking time to sink in.


Bavaria beats up Bud in World Cup beer putsch

June 20, 2010

Despite its transcendent dullness to date, this year’s World Cup has managed to produce a few results of startling clarity, mostly of the negative kind. There’s England’s lacklustre performance, of course, and ITV’s stunning series of own-goals. But it’s the aggregate performance of the official sponsors I’m going to address here – and their need to get real; especially with FIFA, the organising body behind the tournament.

Exhibit One, a piece of market research carried out by Lightspeed, on behalf of our rival publication. Conducted at the time of the England v US match, it showed that only 8% of respondents thought sponsorship had a positive effect on their view of the brands involved. That, mind you, depended on whether they could identify those brands in the first place. Many could not. Quite a few, for example, reckoned Mastercard was a “partner” (30%), when it is not; only 37% gave the correct answer: Visa. A further 29% were highly impressed with Nike’s performance as a sponsor – except that, notoriously, it is not. The answer should be Adidas. Only Coca-Cola hit the button: a high correlation between correct identification and strong awareness; 65% of respondents got it right.

There is, by the way, nothing anomalous or even unusual in these results. Marketing Week has conducted similar surveys over the years, and come up with pretty similar conclusions. Coke scores well, and all the other sponsors are way down the league table; Nike scores too, but it’s offside.

Exhibit Two, the beer brand Bavaria. If you really want to make a name for yourself, don’t bother with official sponsorship (which would be difficult to afford anyway). Try causing a stir by breaking the silly FIFA-inspired anti-ambush laws and watch your brand awareness ratings shoot up.

Personally, I find the whole Bavaria brand proposition muddled. Orange lederhosen? Is it a German brand trying to cash in on a Dutch pedigree, or a Dutch brand trying to associate itself with the annual beerfest in Munich? In fact, the latter. There’s no denying the value of its stunt marketing, however. Those 36 Dutch female fans dressed in Orange miniskirts, whose presence cost ITV’s Robbie Earle his job, are likely to remain on our minds for years to come. More practically, bavaria.com –  whose web traffic was previously undetectable – has been translated into the fifth most visited beer website in the UK. And, according to Bavaria’s UK marketing manager, there has been explosive interest on Twitter and other social media.

Just a stunt whose effects will quickly fade away, you say? I disagree. Thanks to FIFA, Bavaria can now put into play a long-term brand strategy based around “Operation Martyr”.

Handily, the great clunking fist of FIFA has just landed a civil action on the brewer, guaranteeing it the oxygen of publicity for a long time to come. Better still – if not for Ms Barbara Castelein and Ms Minte Niewpoort – is the arrest of the two “ringleaders”, and the preferring of criminal charges against them by the South African police. A  show trial, followed by a custodial sentence could not be better calculated to vilify FIFA and curry favour for the beleaguered beer brand. And what about the subsequent “Free the Bavaria Babes” campaign? Plenty of potential there, I think.  It’s going to make the official sponsors, particularly Budweiser, appear rather stupid (those few we can remember, that is).

So why do the official sponsors bother? Good question, to which there is no convincing answer. We know why Coke does it. It has a long and consistent association with sport that makes the other sponsors look like dilettantes. As for the rest, who knows? Collective delusion? Brand vanity?


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