Skift Take
Saudi Arabia has just said it will bid to host the World Cup in 2034. Should it be chosen, the conservative kingdom will be questioned more than ever about its staunch views on not serving alcohol.
It was two nights before Qatar’s World Cup, and all across its stadiums, staffers were frantically removing beer stands – the country had reversed its decision to serve alcohol in stadiums.
Only those spending upwards of $1,000 a seat in private boxes could indulge, as well as any guest who managed to book a room in one of the country’s hotels or pop-up ‘fan parks’ to watch the games from there.
Saudi Arabia, where alcohol is outlawed entirely, has bid to host the 2034 World Cup.
During and after the World Cup in Doha, Qatari officials said the sudden booze-ban improved the overall event.
Qatar Tourism COO Berthold Trenkel said at the Skift Global Forum East 2022 in December: “I’ve seen a market shift in the tone of articles about Qatar. Pre-tournament, there was a lot of turmoil. You probably remember a bit of a storm when suddenly Budweiser wasn’t allowed in the stadium anymore. But it all turned out for the better.”
“You see a lot of people coming with their kids on the metro, buses, to the stadium, with their strollers. The atmosphere is very relaxed, it’s not aggressive. It’s a fest of celebration. Everything you read in the beginning was a bit of a drama.”
Below is a scene of Argentina fans inside Doha Metro while on their way to Lusail Stadium to watch the Argentina vs. Netherlands game.
Budweiser’s Headache
Before the event, official beer sponsor Budweiser had high hopes for alcohol sales in Qatar. When the U-turn occurred, its chiefs didn’t mention sales performance in Qatar again.
“Stocking up for the FIFA 2022 World Cup, which starts November 20, has been a monumental undertaking for the World Cup’s official beer. The beverage brand expects more beer will be consumed during the tournament than would typically happen during an entire year in the country,” Peter Kraemer, AB InBev’s chief supply officer, told Bloomberg before the event began.
Right after the reversal, Budweiser tweeted a joke about the situation, which it promptly removed.
Post-World Cup, the CEO of Budweiser’s manufacturing company said the FIFA World Cup was “a hell of a run for Budweiser,” on a global level, and that “different geographies had different results.”
Anheuser-Busch InBev CEO Michel Doukeris didn’t mention any figures relating to Qatar or the World Cup during his Q4 2022 earnings call. Instead, he opted to focus on the World Cup’s effect on digital reach and brand awareness, before moving on to other topics.
He said: “Budweiser had a hell of a run and very strong results in brand equity across the globe with the campaigns that we run. The interest for the sport, all-time high and huge excitement building up now for the next event that’s going to be Canada, U.S., and Mexico. We activated our brand, especially digitally, we gained 500 million consumers more.”
Budweiser pays around $75 million to FIFA every four years to be an official beer sponsor. It was later reported that it asked for a $47.4 million deduction for the 2026 World Cup portion of its deal with FIFA.
Saudi’s Situation
High-up executives in Saudi Arabia’s tourism industry have said they will learn from the mistakes of Qatar’s World Cup, though this is related to the treatment of workers rather than its fluctuating alcohol rules.
In an April 2023 interview at the Future Investment Initiative Institute, the Red Sea’s group CEO John Pagano, said serving alcohol was “not on the agenda” for the tourism industry in Saudi Arabia. He continued: “I don’t think it’s absolutely necessary. The non-alcoholic drink industry is booming.”
Looking back on the World Cup, Pagano added: “We’ve prioritized all our workers. We’ve built our construction worker village in a manner that has never been done before. We devoted more space to the workers. We created outdoor spaces. We have cricket pitches, we have football, basketball, cinemas, we have WiFi so they connect with their families.”
“We learned the lessons of what’s happened in Qatar in the past… where workers have been abused. That’s not our thing.”
In terms of events space – a FIFA criteria for host countries – Saudi Arabia is building plenty. Saudi officials have said one of the goals of its Vision 2030 is to establish the country as a regional hub for sporting events. A report from accounting firm Ernst & Young found that the value of the sporting events industry in Saudi Arabia is expected to rise from $2.1 billion to roughly $3.3 billion by next year.
By the year 2034, most of the country’s current pipelined mega-projects will be up and running. That includes The Line, which will have its own Neom football club and stadium, and Trojena, which will host the 2029 Asia Winter Games. The country is also building an entire project dedicated to sports and tourism called Qiddiya.
In total, $1.3 trillion of projects are pipelined in Saudi right now. Qatar was reported to have dedicated $200 billion to its World Cup, potentially more.
11 years from now, Saudi Arabia will look totally different. By then, party hotels, such as Faena, will be open in both the Red Sea and the cultural hot spot Diriyah. A Time Out Market will open with “beverage severies” before 2028, and the kingdom hopes to have as many as 70 million international guests annually.
If everything remains on track, Saudi will have all the events space it needs to host the World Cup, some of the most luxurious hotels in the world, as well as a new global airline to bring over guests in the form of Riyadh Air. For a good chunk of travelers, alcohol would be the final piece of the puzzle to sway them. Saudi has 11 years to think about that.
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Tags: saudi arabia
Photo credit: A rendering of Qiddiya. Used for illustrative purposes. PIF