World Cup Horizontal - H 2013
Getty ImagesBERLIN – German sporting goods giant Adidas has extended its lucrative merchandising deal with world soccer governing body FIFA through 2030.
FIFA and Adidas announced the move Thursday but did not disclose financial details of the agreement. Estimates have put the value of FIFA’s top-tier sponsorship deals at around $100 million per four-year World Cup cycle.
The merchandising agreement between Adidas and FIFA is one of the oldest in commercial sport, dating back to the 1970 World Cup. Adidas is counting on the build up to next summer’s World Cup tournament in Brazil to boost earnings, which have slipped recently.
But in a conference call with investors earlier this month, Adidas Chief Executive Herbert Hainer said soccer sales, driven by the World Cup, will rise some $404 million (€300 million) to a record $2.7 billion (€2 billion) next year. As official sponsor, outfitter and licensee of the World Cup, Adidas will also provide the 2014 tournament’s official ball, the so-called Brazuca model.
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The German company is the number two sportwear manufacturer worldwide behind Nike but is soccer’s top player and is determined to maintain that position. When it comes to sponsorship of the national squads that will battle it out in Brazil this summer, it’s a divided field. Adidas outfits a number of the tournament favorites, including Spain, Germany and Argentina but Nike provides the kit for hosts and World Cup record holders Brazil as well as high-profile squads including France, Portugal, the Netherlands and the United States.
The soccer World Cup is the single most-watched sporting event worldwide. According to FIFA’s own figures, some 910 million viewers watched the 2010 final match between The Netherlands and eventual champions Spain. FIFA notes that total viewership is actually much higher, since the official figures do not include the tens or hundreds of millions of people around the world that watch World Cup matches outside the home.
