Adidas Counting on World Cup to Restore Revenues

Adidas has had a rough year, but they hope to end on a high note.

The German-based athletic apparel company recently reported a 30% decline in overall income for their third quarter sales.  For the period ended September, adidas earned only $319 million dollars, compared to the $452 million they earned the same period last quarter.

Adidas: Official Sponsor of FIFA World Cup (http://tinyurl.com/yzatndm)

Though the drop was painful, adidas now believes it can only go up from here.  “Due to a more moderate increase of input costs and positive impetus ahead of the 2010 FIFA World Cup,” said the company in its November 6 earnings report, ”group profitability will be significantly better in the second half compared to the first half of the year.”

The 2010 Cup doesn’t begin for another 211 days, but adidas anticipates a swell of merchandise sales in preparation for the professional soccer tournament.  As countries gear up for the most-watched international sports events, an extensive range of World Cup products will offered by adidas all over the world.

The company also hopes that their soccer ties will continue to impact sales post-tournament as well.  In addition to being the official sponsor of nearly a dozen teams, adidas is also an official sponsor of FIFA and the official sponsor of the 2010 Cup.  This means that the retailer’s logo will appear on everything from match balls, to referee and ball boy uniforms.

According to Bloomberg, “adidas is aiming to beat record soccer-related sales of 1.3 billion euros ($1.92 billion) in 2008, when the last European Championship was held,” and they are expecting positive growth for their soccer business in 201o.   

Since adidas is currently the number one soccer merchandise provider world-wide, the 2o1o Cup could not come at a better time for the struggling company.

U.S. Vies for FIFA World Cup

The United States Men’s National Soccer Team is headed to South Africa for the 2010 International Federation of Football World Cup, but 27 cities are already vying to be a part of the 2018-2022 FIFA games, said GoUSAbid.com.

27 Cities Vying to Host U.S. World Cup (http://tinyurl.com/yfk6ved)

The cities contending to host the U.S. World Cup range from expected places such as New York City, Chicago, and Atlanta, to more surprising locations, including Nashville, TN, Indianapolis, IN and Detroit, MI.

These cities stand to gain anywhere from $400 million to $600 million at today’s dollar value, according to the results of an independent study for the U.S.A. Bid Committee that was released today.

AECOM, the leading international firm providing support to sports firms and entertainment ventures, conducted the study that shows the United States stands to gain at least $5 billion if they win the bid for either the 2018 or 2022 FIFA World Cup.  A winning bid will also create between 65,000 and 10,000 new jobs in the hosting cities (Study Results).

U.S. Hopes to Host 2018-2022 FIFA World Cup (http://tinyurl.com/yf3ovrv)

When the U.S. hosted the Cup in 1994, it attracted the largest attendance in Cup history and generated record revenues.  Fifteen years ago the United States was able to win the bid by highlighting the attractiveness of its untapped soccer fan base.  This resulted in the creation of Major League Soccer less than two years later.

Though MLS is expected to increase its number of teams from 15 to 18 in the next two years, the league has not been able to reproduce the success of the ’94 World Cup.  While this does not hold much hope for the U.S. bid, FIFA President Sepp Blatter has said that America has a good chance if FIFA continues its rotating the Cup to different continents.

But the U.S. Bid Committee isn’t relying on this stroke of luck.  Instead they are taking an intensely proactive approach, which radiates from their web site, GoUSAbid.com.  “We won’t win the honor of hosting the 2018 or the 2022 FIFA World Cup without showing the world that we are united in our love of the game,” said the committee on its site.

To show the nation’s love, the Committee is using a viral marketing campaign that relies on  fan-to-fan outreach through social networking sites such as Twitter, Digg, YouTube, and Facebook.  GoUSAbid.com also has its own features, such as its ‘Share Your Story’ element, in which fans upload pictures and anecdotes to prove that “the game is in US and we want the World Cup to come back to America.”

U.S. Bid Committee Wants to Prove American Love for Soccer (http://tinyurl.com/ykjjbq4)

So far the campaign has urged 149,381 people to sign the Committee’s petition to bring the Cup back.  Time will only tell if the draw will be enough to keep the United States ahead of fierce competitors such as Russia, England, and Australia.

One thing, however, is for certain: If the FIFA World Cup returns to America, it will be a victory for both soccer fans and non-fans alike.  “While the economic impact to our country and our cities during the World Cup will be of vast significance,” said USA Bid Committee Executive Director David Downs on PotamacSoccerWire.com, “our goal is to have an even greater impact during the eight to12 years leading up to the event that will stimulate the development of the game and the soccer economy, both at national and international levels.”