World Cup Winners (Sponsored Section)

Back to Contents of Issue: June 2002

by Mike Thuresson

The total economic boost that the tournament is expected to create has been estimated at JPY3.6 trillion and the tourism industry is eagerly anticipating the arrival of roughly 365,000 fans, each expected to spend around $3,000. Total World Cup-related investment and consumption in Japan is likely to reach JPY1.42 trillion, according to the Dentsu Institute. The event, economically speaking, is an incredible creator of tourism, new jobs, new products, worldwide marketing (over 5 billion worldwide viewers are expected to watch) and new construction. Indeed, the final economic figures are likely to be more impressive than the Japanese national team's performance.

The business community has been busily rolling up its sleeves to make the hosting of World Cup 2002 an economic success. One of the first industries that will benefit is tourism and Japan's leading domestic companies have been actively involved in pre-tournament preparations. All Nippon Airways (ANA) has been working closely with the Japan World Cup Organizing Committee (JAWOC), a government body appointed by the FIFA worldwide soccer organization, to offer frequent and easy domestic and international air travel to tournament locations in Japan and South Korea. ÒWe were asked by JAWOC to coordinate charter flights for our domestic routes and for passengers who will enjoy games both in Japan and Korea, we will have scheduled flights as well as chartered flights departing from Japan's Haneda airport and Seoul," says Mari Kojima, an ANA spokeperson. ANA also is offering a Visit Japan special fare to overseas residents planning to travel to Japan between May 31 and June 30; the beginning and end of the tournament. ÒOur Visit Japan fare is 50 percent off the regular fare price during this period," says Kojima.

History has shown that hosting international sporting events like the World Cup is extremely profitable for the host country. France, the 1998 World Cup host, earned an estimated $12.3 billion in profit through hosting the tournament, and the Unites States, which hosted the 1994 tournament, earned a profit of $65 million. Japan, in particular, knows the economic glory made possible by hosting such events. The 1964 Summer Olympics were hosted in Tokyo and that worldwide stage signified the end of the postwar period and underscored Japan's incredible economic growth at that time. During the five years leading up to 1964, preparations for the Games literally transformed Tokyo. Roads in the city and suburbs were widened, a huge Olympic village sprang up in Yoyogi and NHK built a new broadcast center nearby to cover the event. Also, the Shinkansen bullet-train -- showcased as the world's fastest -- began service between Tokyo and Osaka a week before the start of the Games. Other Japanese businesses showcased their world-class products. Seiko Epson developed crystal chronometers and printing timers for the Games official timekeeping (at the time the most accurate timekeeping technology in the world). The worldwide stage gave the company the momentum it needed to later export its personal printer and quartz and digital watches. Mizuno, until then a virtually unknown Japanese sports product maker, became a major worldwide exporter after the 1964 Games.

The 2002 World Cup will likely see similar explosive business opportunities. Mizuno has signed exclusive contracts with six famous soccer players, both Japanese and foreign, to promote its product during tournament play. Toshiba has entered customers who buy a notebook computer into a drawing in which some 2,300 World Cup tickets are being given away. The retail market for World Cup goods is worth an estimated JPY100 billion, according to Denstu, and there are reportedly 80 Japanese companies approved as licensees or firms that can legally sell a range of World Cup products.

The broadcast world is also excited about the prospects. Satellite broadcaster SKY Perfect Communication obtained the rights to show all 64 games and has seen its subscriber numbers jump significantly. And since Japan is a country with very low credit card use compared to Western countries -- only 6 percent of Japanese use them, compared to 80 percent in the US -- MasterCard is drooling at the thought of growing its business in this high-growth market by being a sponsor of the tournament.

Indeed, since matches will be held at 10 locations in Japan, the opportunities for local Japanese businesses and smaller cities to feel the economic impact are great. While many of the tourists have already paid for their lodging and transportation in the form of package tours, local merchants are eagerly anticipating a surge in sales of food, drink, entertainment and souvenirs. Memorabilia, such as World Cup commemorative coins, are expected to be major sellers. Nine domestic sake brewers have even gotten into the act and will sell their own officially licensed brands of World Cup sake. While FIFA has laid down some rather stringent rules for sake -- a license is granted to only one company in each prefecture where matches are being held and sales are only allowed inside that prefecture -- brewers have expressed the hope that the World Cup will provide an opportunity to increase the number of sake aficionados around the world.

Since the 2002 World Cup is the first major international sporting event of the 21st century held in Asia, the first time the World Cup has been hosted in Asia and the first ever co-hosting, the media coverage will be extensive. Japan's advertising agencies, whose major clients are television networks looking to sell advertising time, stand to make a significant profit off the tournament. Also, a very likely scenario is that Japan's soccer fans will fuel a boom in TV-related products. The Japan Electronics and Information Technology Industries Association concurs. The industry group, which has dubbed 2002 the ÒYear of Sports", predicts a 45 percent year-on-year rise in production of liquid crystal display (LCD) televisions in 2002 because of strong demand fueled by the World Cup and other sporting events.

Such an increase in television sales because of a sporting event would not be unprecedented in Japan. In the 1950s, professional wrestling burst onto the public scene, and matches featuring legendary wrestler Rikidozan pummeling imported American wrestlers became a Japanese cultural rage. Sales of television sets exploded because of these matches, and some historians believe it jump-started many other parts of the Japanese economy.

Many of Japan's biggest celebrities will bask in this global media spotlight. Norika Fujiwara, Japan's reigning TV commercial queen, has been appointed as an ambassador for the Japan-South Korea exchange that has preceded the tournament this year. During the tournament she will attend all of Japan's games in an attempt to lure the interest of viewers who are not purely interested in the sporting event itself. The World Cup has a tradition of rolling-out big name performers like The Three Tenors and Diana Ross for (generally laughable) opening ceremonies, but it also provides a stage for a domestic star to become better recognized and enter the global market. Fujiwara and other Japanese stars, will surely be in a position to utilize this phenomenon.

Japanese national team star Hidetoshi Nakata is taking advantage of his fame, the tournament and Japan's budding broadband Internet industry to open an Internet cafEin central Tokyo. The cybercafEwill be located in the futuristic Tokyo International Forum building, near the Imperial Palace in central Tokyo and the design of the interior will include input from the 25-year-old two-time Asian Footballer of the Year.

International soccer matches have in the past had a reputation of being a focal point -- as opposed to the cause -- of disaffected troublemakers. Because of this history, Japan is taking significant precautions and therefore stimulating business for the security industry. One Tokyo firm is offering hooligan insurance for businesses that fear being damaged, and many bars and taverns will employ extra workers and security personnel to insure safety. Naturally, the wildly over-the-top, shrieking Japanese media coverage does such interested parties no harm at all.

Perhaps the lasting change this grand sporting event will have upon Japan is improved relations with its neighbor and co-host, South Korea. The two countries have a long, notorious history of difficult relations. A year ago, both sides were embroiled in a well-publicized history textbook controversy that ignited more distrust, with Koreans claiming these Japanese textbooks omitted many facts about the brutality of Japan's colonization of the Korean peninsula from 1910-1945. World Cup 2002 will go a long way to encouraging the two countries to work together toward a common goal: creating a magnificent event that opens the world's eyes to the beauty, culture and business opportunities to be found in the region.

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