Brand Value: Ronaldo’s Tacit De-marketing of Coca-Cola
The gesture made by popular Portuguese soccer star, Cristiano Ronaldo, during a press conference heralding the match between Portugal and Hungary at the ongoing EURO 2020, has continued to generate debate among brand analysts and stakeholders. At a press conference last Monday, prior to Portugal’s game against Hungary, the superstar removed two bottles of Coca-Cola from the table and replaced them with a bottle of water.
The Portuguese footballer has just sat down when he saw the two bottles of carbonated drinks placed before him. He then proceeded to move them away and brought forward instead a bottle of water, which he held up with a flourish, and declared the Portuguese words, “Agua!”, suggesting to the audience that ‘drinking water is a better option’.
Coke is a major sponsor of Euro 2020. News reports reveal that Coke’s share took a dive after that erratic move by Ronaldo. This means some investors lost millions of dollars.
The stock market opened at 3.00p.m. in Europe. At that time, the Coca-Cola share was close to 56.10 dollars. 30 minutes later, when Cristiano Ronaldo and Fernando Santos stepped into the press room at the Puskas Ferenc Stadium in Budapest, stocks plummeted to $ 55.22 per share.
The gesture of putting the bottles aside caused a 1.6% drop for the company on the stock market. And in economic terms, Coca-Cola went from being worth $242 billion to $238 billion – a total loss of $4 billion.
The Portuguese international has said in some interviews that it is important for children to have a healthy diet, away from sugars and fats. Asked on one occasion about his relationship with his son on this issue, Cristiano Ronaldo was clear: “I’m tough on my son. Sometimes he drinks Coke and Fanta and he eats chips, but he knows I don’t like it,” he had said.
Cristiano Ronaldo scored twice, as Portugal started their European campaign on a bright note, beating Hungary 3-0 on Tuesday.
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Any gesture of Cristiano Ronaldo has a huge impact on a product’s brand value and apparently, his coke and water gesture in a press conference perhaps did not fail in that regard.
Many analysts say that Ronaldo’s action was a clear case of ‘counter advertising’. Of course, the bottle of water he raised at the conference was the product of a ‘competitor’. Such an action flies in the face of all corporate reasoning, especially when it is clear that Coca-Cola is a major financier of ‘EURO 2020’.
Speaking on this development, a brands and marketing analyst, Wale Okoya, said: “Coca-Cola shares will bounce back in a few days. The company is resilient.
“However, I am very sure that even before Coca-Cola writes UEFA officially on the infraction on their sponsorship rights, UEFA would have written to the Portuguese Football Federation to make a formal complaint.
“We may not read all of these details in the press over the next few days, but apologies will be given and the matter forgotten.”
He further said, “I think it is highly unprofessional for Ronaldo to do what he did and even tweet about it. He is a professional and he knows the ethics of his sport. You keep your belief to yourself and family and allow the sponsor to maximize his commercial gains.”
There are reports that French soccer star, Paul Pogba, did the same against Heineken after Ronaldo’s tactless move. It is worthy of note that, when a company, for example, signs a sponsorship agreement with a team, an event or a testimonial, it acquires the rights to use and exploit the image and all other things surrounding the team or event. What this means is that the company can use the name, fame and image of the sponsored subject for its marketing and communication activities.
For example, a brand may want to become a sponsor of the African Cup of Nations. The brand handlers can negotiate with the organisers of the tournament what marketing mileage they hope to achieve.
Marketing rights usually vary according to grade and budget invested, but in general, the sponsor of the tournament can acquire the opportunity to use the image of the tournament and all their communication activities, which may include the advertising materials and campaigns, social media presence, catalogues, and newsletters.
A sponsor could be labelled “title sponsor”, “main sponsor”, “official sponsor” or “official partner”, depending on the budget invested and grade of sponsorship.
These are just a few examples of sponsorship rights that a sponsor can acquire and use throughout the duration of the sponsorship contract.
As for Cristiano Ronaldo, could he muster the resources to fight the almighty Coca Cola, even with his influence? Does this action not amount to the height of indiscretion, if not arrogance?
It would be interesting to watch how Europe’s football governing body will handle this to assuage the anger of a key brand like Coca-Cola.