Brands fight for prominence at Games
By Jia Hepeng (China Business Weekly)
Updated: 2004-08-29 08:49

When Chinese athletics strive for gold medals at the Athens Olympics, Chinese companies and China branches of international firms also launch various campaigns to compete for business chances offered by the Games.

"Chinese domestic enterprises have pursued more fame through sponsoring Games-related events, but they still have a lot to learn from their foreign counterparts," said Li Xianguo, a professor of marketing at the Renmin University of China.

The boldest Chinese enterprise pouring money into the Olympics is the computer giant Lenovo.

In March, Lenovo was granted the global partnership by the International Olympic Committee (IOC). Lenovo will sponsor about US$70 million in equipment and cash to IOC in the coming four years.

It is the first Chinese enterprise obtaining such an honour.

More domestic enterprises are competing for some less expensive items to sponsor or grasping Games-related opportunities to promote their brands.

Zhejiang-based drinking water producer Nongfu Spring sponsors drinking water to the Chinese Olympic teams during the Athens Games.

Inner Mongolia-based Mengniu Milk, posted a slogan "China will win" on all of its advertising boards while Fujian-based Yake Food poured money to hire Chinese badminton team and its coach to start in an exciting commercial advertisement describing how Chinese teams win in the Athens Olympics.

Of course, international firms did not sit idly.

Two months before the Athens Olympics started, Coca-Cola launched a programme to select Athens Olympic torch bearers in China.

South Korea-based LG Electronics, after successfully sponsoring the Asian Cup in Beijing, became a sponsor of China's national table tennis team during the Athens Games.

James Kang, marketing director of LG Electronics China Co Ltd, said: "Table tennis is the most favourable sports programme in China. Sponsoring the team will of course shorten the distance between Chinese consumers and our brands."

According to the Chinese Olympic Committee (COC), before the Chinese team set off for Athens on August 8, 33 enterprises have become COC's sponsors during the Athens Games. Top sponsors include six domestic and international firms, each paying 10 million yuan (US$1.2 million) to COC.

The total revenues received by COC through sponsorship -- which was not revealed -- have been more than double of those during Sydney Olympic Games in 2000, COC indicated.

"The rising Olympic and other sports sponsorship comes at a time when more and more Chinese enterprises hope to promote their brands internationally," said Li Kaitong, marketing director of Sinotrust Management Consulting.

Li Ning, a famous sports garment firm created by former gymnastics world champion Li Ning, became sponsor of the Spanish basketball team shortly during the Athens Olympics.

Haier, China's leading home appliance producer, became the sponsor of an Australian professional basketball team early this year.

The match between the basketball teams of China and Spain on August 15 is significant not only because of Chinese NBA (National Basketball Association) player Yao Ming, but also because the two national teams wore sportswear of the same brand, which is the first time in history.

Corporate sponsorship for Olympics is accompanied by huge advertising revenues. It is estimated that the advertising revenues of China's Central Television Station (CCTV) may surpass 500 million yuan (US$60.39 million) during the Athens Olympic Games, double the sum it earned during the Sydney Olympics.

Despite the booming picture, however, Chinese sports sponsors have a lot to do if they want sustainable effect for their Olympic sponsorship, experts say.

Compared with international firms, domestic firms' sponsoring is unsystematic. They focus more on advertising, but most have not worked out a series of sports marketing strategies, noted Li of Renmin University.

By comparison, the sponsorship of Coca-Cola and LG Electronics for Olympic events includes advertising, participatory events, and increased marketing strategies.

LG Electronics' sports sponsorship in China is centered on the Olympics and consists of different games ranging from football to table tennis. It is a long-term strategy and the marketing departments will always introduce other awards, such as LG customers' tours to LG Electronics' headquarter in Seoul, according to Kang.

Li of Renmin University said that the gap between domestic firms and international giants is mainly due to their limited capital. For example, Chinese firms sponsoring foreign sport teams do not have enough money to launch massive advertising campaigns and participatory campaigns in the local markets.

Li of Sinotrust, said another major flaw of Chinese firms in Olympic and sports sponsorship is they mainly take the sponsorship as advertising or marketing strategies, but seldom absorb it into their corporate affairs.

During Coca-Cola's campaign to select Olympic torch senders, more than 10,000 Coca-Cola staff in China were mobilized to organize the event, which strengthened their corporate identity.

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