Chinese Sponsors Reviewed

Recognizing a gap in studies of Olympic marketing ahead of the 2008 Games, Asian marketing agency R3 and Chinese media research firm CSM Media Research launched an independent tracking and research division. Its quarterly studies have shed light on which Olympic sponsors are winning and losing on the ground in China. R3 Principal Greg Paull, who’s leading those studies, sat down with SportsBusiness Journal staff writer Tripp Mickle to talk about the results.

Which one of the TOP programs have been the most successful?
Paull: I think, for Coke, the torch relay has been a phenomenal success. Look at sampling. No one knew in China that Coke had to be cold. So what have they done for the torch relay? They’ve served up 100 million Cokes to people - one by one through 112 cities. That discipline is going to completely change the way Coke goes to market in China, and it wouldn’t have happened without the Olympics.

Any others that stand out?
Paull: J&J did a great setup in primary schools to teach them about the Olympics. You would expect the government to do that, but J&J came up with the training tools, the posters, the stickers and all of that stuff. They went into 400,000 schools across China to teach them about the Olympics with J&J-branded materials.

Who is winning the sneaker war category here on the ground among Nike, Adidas and Li Ning?
Paull: Our view is that if Adidas did not sponsor the Olympics, they would have been in a lot of trouble because Nike and Liu Xiang is a powerful combination together and if they had that sponsorship, they would have leveraged that. Meanwhile, Li Ning is Mr. Olympics, so if he’d had the official sponsorship he would have done a lot. Adidas did the right thing to invest because if someone else had it, they would have been struggling. They are, in fact, in first position in our study. (We have several clients in the sneaker war category and we do our study anyway regardless of our clients.)

How are some of the Chinese companies that people in the U.S. may be less familiar with doing?
Paull: A lot of local companies have done very well, better than the multinationals. Yili, Lenovo, China Mobile - all of these are in the top 10 in our studies, better than Visa, McDonald’s, J&J.

Which of those stand out most?
Paull: Yili, a local milk company, has done a great job. They’ve grabbed the right athletes like Liu Xiang and used them in a very creative way. They tried to do their own version of a torch relay. They ran a health tour that went to 100 cities around China, set up a booth and gave away samples. They also turned that into a TV show.

When the Olympics close, what will be the legacy for sponsors? Are sponsors going to be entrenched enough?
Paull: There will be winners and losers. We’re coming back in November to do the rest of our study. A lot of legacy also will be internal. The way they work will change. They’ll be better marketers as a result of it. You’re talking now about a competitive marketplace that has changed.

From Sports Business Daily

Are Olympics Sponsorships Worth It?

An article today in Business Week, suggests that for some blue chip brands, the answer is no. High profile sponsors who are supporting Beijing, but not prepared to sponsor future games include Kodak, Lenovo, and J&J.

The Lenovo example is pretty self-explanatory. Its sponsorship of the 2006 Winter Games in Turin and the 2008 Summer Games in Beijing will be a one-time shot for the Chinese PC maker. For Kodak, a sponsor of the games since 1986, the returns just aren't there. Antonio Perez, CEO says "It's just not the best way for us to spend our money."

While China is seen as an opportunity to get a brand in front of millions of new consumers, some research suggests few consumers even notice who is backing the Games. In a survey of 1,500 Chinese city dwellers earlier this year by London's Fournaise Marketing Group, only 15% could name two of the 12 global sponsors, and just 40% could name one sponsor: Coca-Cola. Adding to the confusion for consumers are 21 additional national-level sponsors, including Adidas and Volkswagen.

Others see it differently. Coke has signed on through the 2020 Games. "Coke has not in the least reconsidered its Olympic sponsorship," says Kevin Tressler, director of Coke's Worldwide Sports & Entertainment Marketing.

The Chinese games potentially offer a unique set of circumstances to sponsors. As well as restrictions in the IOC charter that ensure nonsponsors' ads are restricted in and around Olympics venues, Beijing has extended the ban to all outdoor advertising in the city's airports, buses, and billboards within the city center.

In recent games, the debate as to whether to sponsor the officials of the IOC and host government or the competing athletes has probably come down on the side of the latter. Nike especially have made much of the fact that their shoes are won by the gold medal winners while official sponsor Adidas shows are worn by the men in suits. However, in China, things are different. Government officials will notice which companies show up in support even if consumers don't, a major factor for sponsors in a country where guanxi, or relationships, are such an integral part of doing business.

London 2012 will be a different story. Marketers will have to weigh whether there are more cost-effective ways to reach consumers and leverage Olympic enthusiasm without having to pay the high price. Frank Vial, strategy director of branding agency Landor Associates, argues that in a world that's moving toward targeted marketing, "maybe the Olympics will have to reinvent itself as something other than a global, monolithic brand."