Magazine / Society / Football / Background | 04/06/2008

The Consumption Myth

"Expect Emotions" is the slogan of the EURO 2008 football championships in Austria and Switzerland. But will companies' hopes of cashing in on fans' enthusiasm pan out? What will be the real gains after all the hype?

Cornflakes boxes contain German flags as prizes, local pharmacies distribute Euro 2008 game plans and store prices for televisions drop with every goal. Each time a major sporting event rolls around, the business sector is overtaken by the urge to cash in on the mood of euphoria. But their hopes all too rarely translate into profits.

More jobs and more hotel guests

What will this mean for EURO 2008, which kicks off on Saturday? One thing is for sure: the host countries have done their homework.

Photo: AP

Austria is expecting its gross domestic product to increase by an additional 0.15 percent, while Switzerland anticipates an additional GDP rise of 0.14 - 0.18 percent, as well as several thousand additional jobs – at least for the three weeks of the championships. Hotels in both countries expect one million more overnight stays than usual.

Don't expect too much

Nevertheless, sports economist Gregor Hovemann cautions against excessive optimism: "The fact that two countries are hosting the event will dampen the economic impact", he says, adding that profits from major sporting events tend to be overestimated in any case. "People often forget to factor in investments in stadiums and other infrastructure." Some prognoses for the FIFA World Cup in Germany erred ludicrously, forecasting astronomical profits. At the end of the day retailers had sobered up considerably. According to an analysis by the German Institute for Economic Research (DIW), "the championship had no positive macroeconomic effect to speak of".

Who is allowed to advertise

Economist Gregor Hovemann points out that it is primarily advertisers and marketing specialists who profit from the Football Championships, promoting them as a major sales opportunity. Their job is to pry open the legal niche that UEFA continually tries to close – associating products with the championships without a licence. This is difficult, and slip-ups can be expensive because UEFA is not afraid of going to court. A media presence as official sponsor, by contrast, is beyond the budgets of mid-sized companies, with costs estimated at up to 26 million euros. Altogether the advertising value of the championships is put at around 400 million euros. That is what businesses would have to pay to equal the media attention of the event itself.

The Swiss, at any rate, are relatively unmoved by the commercialisation of football. According to a survey by the Swiss opinion research institute Isopublic, only 41 percent of the population care about the European Football Championships at all, never mind wanting to wave the Swiss flag.

Further articles on the subject » Infrastructure / Travel and Transport, » Public Culture, » Trade, » Sport, » Tourism, » Austria, » Switzerland
More from the press review on the subject » Infrastructure / Travel and Transport, » Public Culture, » Trade, » Sport, » Tourism, » Austria, » Switzerland