For football fans, normal life will be put on hold for a few weeks this summer as the triumph and tragedy of the World Cup is played out. While some will make the journey to Brazil, for many more, it will be a time for wearing the colours, drinking and socialising, as well as tweeting and posting.
- The usual suspects;
- Anti-football consumption;
- Tourism boon or curse?
- I hate football: Get me out of here!
- Digital TV push in emerging markets;
- Social media now integral to the World Cup experience;
- Money for old rope?
- Building brand Brazil.
- Alcoholic, soft and energy drinks;
- Takeaway food, snacks and fresh meat;
- Flat-screen HD TVs and digital set-up boxes;
- Brazil-themed or related products;
- Smartphone sales may receive a boost, while social media use is likely to surge.
The 2014 FIFA World Cup will be held in 12 Brazilian cities, with a total of 64 matches taking place over 32 days, during June and early July. It is the biggest single-event sporting competition in the world, with 910 million people tuning in to watch the final of the 2010 event between Spain and the Netherlands, which was held in South Africa.
The Usual Suspects
For many consumers, the World Cup brings a suspension of many of their normal habits. Work and family life will take a back seat for a couple of weeks as they engage in an orgy of TV viewing. Some will invite friends around to turn the event into a party, while others will go their local pub, eager to experience the communal and even carnival atmosphere this event can generate. This will provide a much-needed (if short-term) boost to on-trade sales of alcoholic drinks, which have been in steady decline in years.
However, it is off-trade that is likely to be the biggest beneficiary, as fans snap up beer to drink at home during games. Sales of everything from takeaway and home-delivery consumer foodservice to soft drinks and crisps/chips are also likely to receive a boost. Barbeques also tend be popular World Cup events, boosting sales of fresh meat.
Sales of such items as coffee, energy drinks and protein bars are likely to receive a boost as many burn the candle at both ends. Sales of vitamins and dietary supplements may also rise as consumers seek to detox and compensate for their dietary excesses.
However, not every business will be a winner in the World Cup bonanza. With many welded to the couch, big games are likely to leave slim pickings for many full-service and casual-dining restaurants, while cinemas are also likely to struggle for a few weeks. On the other hand, the World Cup can be a godsend for football-haters and so-called “World Cup widows” seeking to enjoy a meal at a popular restaurant or watch a film in peace and quiet. Others may escape the football by watching their favourite TV series online or on DVD.
Tourism Boon or Curse?
The Brazilian Institute of Tourism estimates that around 600,000 tourists will visit the country to attend the World Cup and that they will spend approximately $2.6 billion. Meanwhile, around three million Brazilians are forecast to attend, spending about $7.9 billion. A study conducted by employment website Laborum.com in Chile during November 2013 found that 65% of men aged between 30 years and 50 years in full-time employment were planning to travel to the World Cup.
However, the economic benefits of hosting a World Cup are not clear cut, with some arguing that such events actively deter non-fans from visiting the country. In the wake of last year’s riots in some Brazilian cities, predictions of unrest could also deter some from travelling.
Moreover, Western Europe, traditionally the biggest source of travelling fans, is still quite weak economically. Combined with the fact that Brazil is a relatively expensive country for everything from restaurant meals to transportation, this could further depress visitor numbers. Economist Samy Dana, a professor at Brazilian higher education institute and policy think-tank Fundacao Getulio Vargas told the BBC that “Visitors will be experiencing the consequences of a local problem that has dramatically affected Brazilian families in the last years – the country's rising costs of living.”
I Hate Football: Get Me Out of Here!
The World Cup aside, Brazil is a popular tourism destination in its own right, and some fans travelling to the event will be taking their partners with them. At least some of the latter will be in search of non-football-related activities. Yoga Body Rio is seeking to exploit this by setting up two retreats in-and-around Rio de Janeiro especially for them during the World Cup.
Digital TV Push in Emerging Markets
Big sporting events tend to boost sales of televisions. This was certainly the case during the 2010 World Cup in South Africa. However, in developed economies most consumers who want a flat-screen TV already have them, and newer technologies have either failed to take off (e.g. 3D television) or are not yet mature enough for the mainstream market (e.g. Ultra HD). As a result, TV sales are unlikely to receive more than a small bump in these markets this time around.
In some emerging markets, the picture is somewhat different. For example, in Thailand, local electronics retailers predict that a combination of the launch of digital terrestrial TV broadcasts and the World Cup will provide a significant boost to the sale of televisions and set-top boxes. As a result, the annual rate of growth in global volume sales of digital TVs is forecast to accelerate from 3.8% to 5.5% between 2013 and 2014, to 235 million units.
Volume Sales of Digital TVs: 2009-2012 (Actual), 2013-2014 (Forecast)
Source: Euromonitor International from trade sources/national statistics
Social Media now Integral to the World Cup Experience
However, smartphone sales could receive a boost from fans eager to remain abreast of the latest World Cup news and scores and chat with their friends about it. Expect the use of such social networks and chat apps as Facebook, Twitter, Whatsapp and Viber to surge (and perhaps even reach record levels) around big match times, as many opt for a “dual-screen” experience. Meanwhile, a flood of World Cup-related photos and videos likely to appear on the likes of Instagram and Vine.
Money for Old Rope?
Many will be wearing their national colours when their team is playing. However, such displays of national pride are becoming increasingly expensive. Fans eager to don England’s Nike World Cup shirt will have to pay up to £90 (US$151) to wear the three lions on their chest. This has prompted a flurry of complaints and sarcasm in the media, both old and new.
A poster on the Guardian newspaper’s website commented: “Manufacturers are coming up with more outlandish descriptions to justify fleecing supporters out of money. At the end of the day, it's still just a football shirt. However, if we keep buying it, they'll keep producing it at an exorbitant selling price.”
Building Brand Brazil
The Brazilian government sees the World Cup as a major opportunity to raise the profile of Brazilian culture internationally and boost exports of such products as cachaça, a spirit made from sugarcane juice, in addition to local wines. In 2011, the BBC reported that “Currently exporting only very small quantities, the Brazilian wine industry has high hopes that the country's staging of the 2014 World Cup can be used as a springboard to achieve ambitious overseas sales growth.”
However, Brazil-based branding efforts can run into controversy. During early 2014, Adidas launched a number of Brazilian-themed T-shirts in the USA, but they were quickly withdrawn from sale after thousands of Brazilians took to social media to complain about their overt sexual connotations – one of them featured a bikini-clad cartoon model and the phrase “Lookin’ to score in Brazil.” Some even complained that they condoned sex tourism.
The online element of global sporting events is only likely to deepen as smartphones and 4G (fourth-generation) mobile internet become increasingly ubiquitious. If all goes well, Brazil could enjoy a long-term boost to its domestic tourism industry and see demand for some of its exports grow. Meanwhile, from Berlin to Santiago and Moscow to Accra, late nights, overindulgence and spontaneous outbursts of rejoicing or lamentation are likely to be the order of the day.